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Saturday, May 18, 2024

What would Americans do with a windfall?

A little windfall can do wonders, according to Americans. Common windfall scenarios include receiving an annual bonus, tax refund, an inheritance, or even a big lottery win. What would you do with unexpected financial gains? Americans are most likely to save or invest the money (65%), pay off debt (52%), or use the funds for immediate financial relief (37%), like paying their bills.

Key takeaways

  • More than half of Americans (54%) think their tax refund will be smaller this year; Nearly 3 in 10 (29%) say it will be under $1,000.
  • 48% of those expecting a tax refund depend on the extra money to combat rising costs due to inflation.
  • 20% of Americans would seek the advice of a financial professional after receiving a windfall.
  • More than 1 in 5 Americans (21%) are counting on a windfall to fund their retirement.
  • 43% of Americans wouldn’t tell their spouse/partner about receiving a sudden sum of money. 

Saving versus spending: Prioritizing a windfall

Most Americans expect a windfall to come their way this year, with 72% of those surveyed looking forward to a tax refund and 32% expecting to receive a bonus at work, but Americans differ on how they would put those funds to use.

Two in 5 Gen Zers would spend a windfall on leisure activities such as travel or hobbies. Millennials, on the other hand, would take a more pragmatic approach, with 52% opting to use their windfall to pay off debt (vs. 41% of Gen Z).

Across all generations, 65% of Americans would prioritize saving or investing any financial gains, 52% would allocate the money to pay down debt, and 37% would leverage the funds for immediate financial relief, like paying their bills. Upon receiving a windfall, 1 in 5 Americans would seek the help of a financial professional. Among those in relationships, 43% wouldn’t tell their spouse or partner about receiving a windfall.

More than 1 in 5 Americans (21%) are counting on a windfall to fund their retirement. And some savers are hoping for more unexpected wins: nearly half (45%) say they have a better chance of winning the lottery than receiving an inheritance.

A little windfall can do wonders

As it turns out, a little can go a long way: for more than half of Americans (51%), a windfall of $5,000 would be enough to improve their financial outlook for two to five months. For a windfall of that size, Americans would save $2,259 of it and put $1,487 toward paying down debt, on average. Nearly the same amount (50%) say a windfall of $25,000 would provide relief for more than a year.

Refund relief

Many Americans rely on their tax refund for essential financial support, and 29% expect their 2024 tax refund to be less than $1,000.

For those expecting a tax refund, 54% believe it’ll be smaller this year than last year. Over a third (34%) of these Americans say they plan to use the money to pay their bills, and nearly 10% will use it to cover mortgage payments. Almost half of baby boomers (48%) expecting a refund say they need it to pay off debt.

Inflation continues to make an impact, as nearly half (48%) of those expecting a tax refund consider it a vital resource to combat rising costs.

The bottom line

Upon receiving a large sum of money, some may want to act quickly — making exciting purchases, investing, or paying off debt. Before deciding what to do with your windfall, consider speaking with a financial professional.


Empower commissioned a survey of 1,011 Americans on March 6, 2024, to explore what they would do with a windfall.

About Empower

Empower, a leader in financial planning, investing, and advice, is dedicated to creating financial freedom through people and technology. Connect with us on and subscribe to The Currency™ for the latest money news and views shaping how we live, work and play.

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The CurrencyTM, a publication from Empower, covers the latest financial news and views shaping how we live, work, and play. We keep you current on ways to plan, save, and invest for life.

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