Payroll Tax Cut Extended until February 2012

23 12 2011

 

The payroll tax rate will now be kept at 4.2 percent until the end of February. It had been slated to increase after December 31 to 6.2 percent.  Eliminating the payroll tax cut would have cost a family earning $50,000 a year about $40 per paycheck. That’s real money for working families.

Now, we know it sounds enticing to spend the money, however if you have not taken advantage of the payroll tax cut for the year 2011, now is your chance! 

Top 3 things to do with the increase:

  • Pay off Debt with this Extra Savings
  • Increase Retirement Contributions
  • Start an Emergency Fund

This is the perfect opportunity to accelerate debt repayment and a time to “beef” up your savings.  Yes, beef up is a financial term.

Happy Savings!

Read more about the tax cut and unemployment benefit extensions here and here.

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