Is Your Tax Refund Less Than You Were Counting On? 6 Things You Can Do

A tax refund is typically the largest and most reliable windfall many Americans receive annually. A recent CNET survey finds that more than three-quarters of filers expect to receive a tax refund, and the vast majority already have plans for the money.

Just 16% of filers are planning a big tech, home appliance or other retail purchase, while another 7% will fund travel. Others intend to sock it away, with 12% planning to start an emergency fund.

Most filers (54%) have earmarked at least part of their refund to make ends meet, including paying bills, paying off debt and covering their rent or mortgage.

While the average tax refund this year so far is $3,221, everyone's tax situation is different. There's no guarantee you'll get this amount.

So what if you don't get the big refund you were counting on this year? Consider these alternative ways to make up for the shortfall.

Read more: Tax Refund? I Can Afford a Carton of Eggs With Mine

1. Double-check your return for mistakes

You can change your tax return whether you're still filling it out online, have already filed or have even received your refund already. If the estimated or actual refund isn't what you expected, review your forms again to ensure you've claimed all of the tax credits you're eligible for and that your filing status is the most advantageous.

You can file an amended tax return if you made a mistake on a return you've already filed. In fact, you can amend returns up to three years old. If an amendment results in the IRS owing you a larger refund, you'll be issued the difference between that amount and any refund you've already received.

2. Consider other ways to cover living expenses

If you were counting on your tax refund to make ends meet, inventory your financial situation to find opportunities for relief.

Compare your monthly income and your bills, including housing and utilities, insurance, debt payments, subscriptions and other monthly payments. The best budgeting apps can make it easier to track. If your income doesn't cover the bills or the difference is tight, look for places where you can tweak your resources and expenses. You might be able to:

• Eliminate bills by canceling services.
• Lower bills by reducing service or negotiating a better rate with the provider.
• Get assistance from community services or government resources: 211.org can help connect you with nonprofit or government assistance for food, housing and utilities.

3. Use credit strategically to fund major purchases

You might have wanted to avoid debt by using your refund to make a big purchase or home repair. But financing may be an option if you don't get the refund you expect and the need is urgent.

The kind of debt you use impacts how easy it'll be for you to manage it going forward. A few to consider:

• Home equity loan: This kind of loan usually comes with the lowest interest rate of all of your options because it's secured by your home. Repayment periods are typically five to 30 years with a fixed rate, making payments predictable. But make sure you budget for the new payments because if you default, the lender could take your home.
• Personal loan: These unsecured loans can offer flexible terms and better interest rates than a credit card. You can get approved for some loans the same day you apply, but most require a minimum credit score to qualify.
• Store or contractor financing: You may be able to set up a payment plan through a contractor or retailer to cover home repairs, appliances or tech purchases. This is often the easiest kind of financing to qualify for and the simplest to set up, but it tends to come with less favorable terms, including higher interest rates.
• Credit cards: You can put major purchases on a credit card with a high enough limit, but credit cards typically have some of the highest interest rates so that the debt can snowball quickly. You might consider applying for a 0% APR credit card, which offers more time to pay off a purchase before you accrue interest.

4. Use the debt snowball method to manage debts

If you're tired of dealing with debt and don't get the windfall you were hoping for to pay it off, continue to make progress with a sustainable debt-payoff method.

One popular option is the debt snowball method. While continuing to make minimum payments on your other debts, you put a little extra money each month toward the debt with the lowest balance until it's paid off. Then roll those extra funds into your payment for the next lowest-balance debt, and so on.

This method lets you see the quickest wins to gain momentum and simplify your bills.

5. Fund financial goals in smaller increments

A windfall to boost your savings would look great on your balance sheet. But you can still make progress.

One easy way to start saving more is by automating it. Setting up automatic transfers to put aside a small amount of money from every paycheck can help you build a regular savings habit. Consider setting up a high-yield savings account to help you grow an emergency fund faster. 

Some investment apps let you start investing without high minimum contributions. Acorns even lets you invest your "spare change" by rounding up debit and credit card purchases.

6. Plan ahead for a more accurate refund next year

Make next year's tax filing easier and more predictable by starting your prep now with these tax filing tips:

• Learn which tax deductions and credits you may be eligible for
• Start organizing now, especially if you plan to itemize. Keep a list of your purchases and save (scans of) your receipts throughout the year.
• Speak with a tax preparer now to make the most advantageous plan for next year. If you file taxes online, many tax software services offer ways to speak with a tax preparer online for tax planning.

And remember, even if a windfall might be helpful right now, a bigger refund could mean you're overpaying the IRS.