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You May Have an Easter Account and Not Know It

Updated: Jun 30, 2021

Many of our older readers may have had a Christmas Club Account at the bank. For our younger readers, this was a popular practice in the past. It was a type of savings account which people stashed money away into throughout the year as a method of budgeting for the most wonderful and expensive time of the year. This is a great method of mindless/painless saving, but produces a low amount of interest and accessing the money early could result in a penalty. The ability to access and control your money is something important to consider.


Most have never heard of an Easter account though, so what is it?

“Easter Account” is something of a financial slang term rather than a type of account offered by the bank. Once a year typically around Easter time, the government refunds the excess money which people have overpaid on their taxes. In effect this creates something of a stimulus and it actually makes for the largest check received by almost half of Americans (44%) each year.(1) Of course, the government also offers and pays credits included with the return which may be available to qualifying groups such as students. For tax advice please consult with your CPA.

Is there a problem with Easter Accounts?

Overpaying on taxes has two of the same pitfalls that plagued Christmas Club Accounts. It reduces your ability to access and control your own money. It’s actually accessed and controlled by the government, essentially functioning as an interest free loan from the taxpayer. There’s also no interest generated by your money in this case. In fact, rather than the money earning interest or being put to use, it’s losing value due to inflation while it’s out of your control.

One problem unique to Easter Accounts

There’s a tendency among Americans to forget it’s their own money being returned each tax season (in addition to a potential credit). With Christmas Club Accounts, people were saving for a purpose and the money was to be spent purposefully. Less than 1 in 2 Americans (46%) know that tax refund money is technically withdrawn from their paycheck and is being returned.(1) That’s part of the reason why you might watch others treat themselves to things they wouldn’t otherwise purchase during this time of year.

However you use your tax return, be intentional and use your money wisely. Want to read about the difference between those who invest early in life and those who wait? Why waiting to save for retirement could spell disaster for your retirement.

To speak with Michael Romanello about taxes or any other financial subjects you’d like to discuss click here.

Source Cited -


Oct. 2019 Qualtrics & Credit Karma Tax Refund Survey


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