What will you do with your tax rebate check?

President Bush has now signed the multibillion-dollar economic rescue package that will mean $300 to $1,200 rebates for many American households, depending on their tax bracket and claimed dependents.

While the refunds will probably not arrive for a few months, the unexpected check from Uncle Sam could be your ticket to jumpstart your savings or pay down your debt.

What will I do with my rebate check? Already the wheels in my mind are turning – that’s a nice chunk of change. And it’s my civic duty to spend it, right? Maybe, but look at it another way – if you use it to reduce your debt it could help the economy in the long run better. With less financial burden on each individual we’ll be freed up to make bigger spending plans in the future. For example, the $200 credit card payment I might eliminate can be put into a savings account and spent later on a family vacation or a down payment on a new hybrid vehicle.

An Associated Press poll found that only 19 percent of those surveyed said they planned to spend their rebate checks. Forty-five percent said they would pay bills, while 32 percent said they planned to invest the money.

Consider using the unexpected income to pay off debt or increase your savings. Click here to learn the best way to handle a financial windfall, and visit www.FeedthePig.org for more money-saving tips.