Wife wants to use tax refund for a trip to Vegas

DEAR HARRY: Unfortunately, I filed my 1040 a few days before the deadline, so I won't be getting my refund anytime soon. It's going to be about 10 grand, and my wife wants to use it to splurge on a Vegas trip. I haven't said anything, but I don't think it's wise.

We're in our 50s, and I think we ought to pay more attention to accumulating money for our retirement. What do you think?

WHAT HARRY SAYS: I'm pretty conservative when it comes to money, so I hope your wife won't hate me. How about less of a splurge? How about a couple of days in New York?

My first consideration would be to apply it to any loans you have. The interest rates on personal debts can take a big bite out of your financial security. Go for credit cards first, and then make advance payments on your mortgage principal. As an alternative to paying down your mortgage, you can add to your IRAs.

If you are using a bit of over-withholding from your paycheck, stop. Even with our low interest rates, you're really making Uncle Sam an interest-free loan. It's much better to get that money in your paycheck and use it for one of the purposes I cited. That also has the virtue of not giving yourself a big lump-sum refund that tempts people to want to splurge.

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