Jumpstarting a Dividend Engine

For many Marylanders, this year’s tax season is going to be different. Recent nationwide legislative changes will jump the average federal tax refund 11.1% more than last year. If you are among those fortunate enough to benefit from this legislation, the temptation might be to use those funds to reward yourself with purchases or travel, but maybe it is exactly the right time to build your own personal “dividend engine.” Your refund could fuel returns for years to come.

Let’s do some math.

At MarylandSaves, we know there are few things as uninspiring as practical advice, but that is the only kind of advice we provide, so let’s see if we can make it more exciting. Consider investing that money. We acknowledge that doesn’t sound exciting at first, but consider this:

Estimates are that the average refund this year for Americans will be about $3,500. Let’s say you invest that $3,500 refund today at the current standard market rate, that could grow to more than $60,000 over 30 years.

More things to consider.

It is safe to say that for most Marylanders, we are living in challenging financial times of general inflation on groceries and other goods and services, and historically high gas prices, coupled with uncertainty about the future health of our national economy.  Given all of that, investing and saving seem to be more prudent than ever.

Of course, investing and saving are both good, but to stay on track, you have to ensure you give yourself access to an emergency fund for the unexpected—because you can always count on some financial curve balls coming your way. Also, it’s always a good idea to look to eliminate any high-interest debt as soon as possible—clearing debt is its own return.

Consider a Roth IRA if you want your dividends to grow and be withdrawn tax-free in retirement. Your 2026 refund doesn't have to disappear into everyday expenses. By choosing assets over liabilities, you are not just filing a return—you are funding your future, and definitely check with your financial advisor for investment guidance.

And coincidentally.

If you are a business owner, you should know that MarylandSaves is an emergency and retirement savings program that affords business owners a free way to offer a payroll-deducted savings plan at work. MarylandSaves has an emergency fund, and savers contribute to a Roth IRA.

If you receive a refund, or if you are a business owner, or if you are in a company that doesn’t offer a payroll-deducted emergency and retirement program, go to MarylandSaves.com and start your dividend engines today.