Thanks to the Recovery Act, Americans are enjoying an average tax refund that is up nearly 10 percent! The average tax refund in 2010 was a record $3,036.00, up $266.00 from the previous year. Among provisions that have boosted refunds are tax credits for first-time homebuyers, increased child tax credits and a deduction of state and local taxes on purchase of new vehicles. Unexpected income, no matter how small or big, is always welcome.

Generous or small, there is a way you could put your tax returns to good use. Before you go out and splurge, think before you spend! You can make your money go a long way if you think first and then part with your money. The last thing you want to do is blow it away on something you would easily forget. At least make a memory that will last and possibly provide you with a good return on your investment.

Although a tax refund is surplus money we paid to the government as our advance taxes, we tend to view a tax refund as if it is not our own hard-earned money. When money comes back to us in the form of a tax return it’s as if we received an unexpected gift! An online poll of how people will be spending their tax refunds reveals 58 percent will use it to pay down debts or use the money to pay bills; 31 percent said they would put it into savings and 11 percent said they would splurge it.

What will you spend your tax refund on? Coming out of the recession, it may be practical things like groceries, paying up your credit card balances, etc. While these are fine goals to keep, they should not come at the cost of leaving your loved ones bereft of a life insurance policy. In fact, a good way to put this money to work is by purchasing a life insurance policy or renewing your existing policy. While you are renewing your life insurance policy, you should check the beneficiaries as well. One of USA Today’s top five financial resolutions that could save you big money includes updating your beneficiaries on your insurance policies and retirement plans. Experts say that people often forget to do this. When they die unexpectedly, the money does not go where they want it to go.

Think about this. With dwindling disposable incomes, many people have had to either stop payments on their insurance policy or take life insurance completely off their budget. If you’re one in this category, put your tax refund to good use by re-activating your life insurance policy or purchasing a new one. Times are hard, which is why it is more important now than ever, that you protect your loved ones against unexpected calamities that may jeopardize their future. All it takes is a little planning and putting the priorities of your family first.

A professor of behavioral economics at Duke University, Dan Ariely says, “Very few of our decisions are based on independent, rational decision making. They are based on habits — if you’ve done something before, there’s a good chance you’ll do it again and again and again.” Here’s a good habit you could begin this year: Start using your tax refund to pay off your annual life insurance premium. In fact, paying your life insurance premiums annually, will work out to be cheaper than paying monthly premiums. And if you use your tax rebate to pay your annual life insurance premium, you might even feel as if you got a free life insurance policy since nothing from savings is being spent.

Paying premiums on a life insurance policy is not as expensive as one might think. And having some insurance that you can afford is better than having no insurance at all. If you’re looking for a bargain, term life insurance works out to be more cost-effective than a permanent life insurance policy. Take for example, a 49-year old male, in good health, and living in California. A $1 million term life policy for level monthly premiums would work out to just $160. The same coverage for a permanent life policy would cost around $760.00.

Since life insurance is competitive business, you can find the best term life insurance rates by shopping around. There’s a good chance you’ll find an affordable term life insurance policy through online life insurance providers. Such providers are affiliated to hundreds of reputable life insurance companies with top ratings. Their databases have can easily provide you with instant life insurance quotes. You’ll receive the most affordable best term life insurance quotes for your comparison. By getting a free life insurance quote you may be able to find an affordable term life insurance with the best value and save up to 70 percent.