What is the most effective number of withholding allowances for a single parent?

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Replied by FrankN on topic What is the most effective number of withholding allowances for a single parent?

JGibbs wrote: How many dependents do you have? Some experts say it's better to claim the least amount possible and to put that money in a savings account so it will accrue interest. Their idea is that you're loaning money to Uncle Sam for the government to collect interest off your money.


I am not sure I understand this concept. If you don't take the deductions you have to pay more in taxes?
1 year 8 months ago #1

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Replied by Lexie on topic What is the most effective number of withholding allowances for a single parent?

JGibbs wrote: How many dependents do you have? Some experts say it's better to claim the least amount possible and to put that money in a savings account so it will accrue interest. Their idea is that you're loaning money to Uncle Sam for the government to collect interest off your money.


This is all well and good but how many people will have the discipline to put that money into a saving account? Most that get a rather large sum back from their taxes spend it quickly and are then broke for another year. Kind of like, Alexander who used to be Rich Last Sunday by Judith Viorst.
1 year 9 months ago #2

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Replied by FrankN on topic What is the most effective number of withholding allowances for a single parent?

JGibbs wrote:

Joker wrote: I was just offered in connection with a prepaid debit card a 5% savings account. I never thought I would see that again. Have you found anything that is higher than the 1-2% range? The card I have is Compass Bank. I am going to be very pleased to save some cash with them at that rate!

Does the 5% rate only apply to the money you put on the prepaid debit card? How much are the fees involved? Sometimes the fees will eat up any advantage you might receive from the higher interest rate.


Great questions and that seems a little too good to be true.
1 year 11 months ago #3

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Replied by JGibbs on topic What is the most effective number of withholding allowances for a single parent?

Joker wrote: I was just offered in connection with a prepaid debit card a 5% savings account. I never thought I would see that again. Have you found anything that is higher than the 1-2% range? The card I have is Compass Bank. I am going to be very pleased to save some cash with them at that rate!

Does the 5% rate only apply to the money you put on the prepaid debit card? How much are the fees involved? Sometimes the fees will eat up any advantage you might receive from the higher interest rate.
2 years 1 hour ago #4

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Replied by Joker on topic What is the most effective number of withholding allowances for a single parent?

I was just offered in connection with a prepaid debit card a 5% savings account. I never thought I would see that again. Have you found anything that is higher than the 1-2% range? The card I have is Compass Bank. I am going to be very pleased to save some cash with them at that rate!
2 years 20 hours ago #5

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Replied by Pinky on topic What is the most effective number of withholding allowances for a single parent?

Me neither. The government has put us in its pocket and pulls us out when it needs cash. Really depressing about the SNAP benefit amounts. One single person gets around $194 per month. The Republicans want to cut that amount. I was talking to a friend in the human services industry and she said it is really low due to those old food prices. How can you expect a person to make it for a month on $194 even working if they are an uneducated wage earner?
2 years 5 days ago #6

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Replied by Joker on topic What is the most effective number of withholding allowances for a single parent?

I never thought about my refund money being a loan of interest-free money to the government before. This thought is really depressing. They get us at every corner and twice on Sunday. Our government needs a total overhaul of the thing as a whole. Did you know that the SNAP benefit amounts are based on 1978 food prices? And the Republicans still gripe. Sometimes you just don't want to think about all the wrong they do to our country's members.
2 years 5 days ago #7

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Replied by Wanderer on topic What is the most effective number of withholding allowances for a single parent?

In looking at Savings Account options ... you may want to look at some of the Banks and Credit Unions that pay more than 1%. They do exist and you would earn more!
2 years 2 weeks ago #8

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Replied by Pinky on topic What is the most effective number of withholding allowances for a single parent?

I only have the one daughter and myself. I am intrigued by the idea to start a savings account so that you can accrue interest on the money that the IRS uses for free. At least, you would be earning a little and it would be accessible for emergencies.
2 years 2 weeks ago #9

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Replied by JGibbs on topic What is the most effective number of withholding allowances for a single parent?

How many dependents do you have? Some experts say it's better to claim the least amount possible and to put that money in a savings account so it will accrue interest. Their idea is that you're loaning money to Uncle Sam for the government to collect interest off your money.
2 years 2 weeks ago #10

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What is the most effective number of withholding allowances for a single parent? was created by Pinky

I am a single parent and I wondered if I am claiming the correct amount on my W-4. I usually claim 1 so that I have some refund coming at the end of the year. Is there a better way to achieve maximum refund without killing my check?
2 years 2 weeks ago #11

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