As the tax season approaches, many anticipate the arrival of their tax return with plans for how to spend it. At CBE Group, we understand the excitement that comes with this annual financial boost. However, we also see a prime opportunity for a strategic financial decision that can profoundly impact your future: using your tax return to pay off debt.


The Weight of Debt

According to research done at Northwest Mutual, the average American has $21,800 in personal debt exclusive of mortgages. In 2023, credit card debt emerged as the leading source of personal debt, accounting for 28%, second highest source being auto loans.  “People who carry personal debt say 30% of their monthly income goes toward paying it off, and most also expect to remain in debt for years.” – Northwest Mutual

Debt is more than just a number that you owe, it is a financial burden that can impede your progress towards financial freedom. Moreover, it can affect your credit score and your ability to borrow in the future, adding stress to your financial and personal life.


The Benefits of Using Tax Returns to Eliminate Debt

At CBE Group, we advocate for using your tax return to reduce or eliminate your debt for several reasons:

      • Interest Savings: Paying off high-interest debt not only reduces what you owe, but it also cuts down on the interest that could have compounded over time.
      • Credit Score Improvement: Lowering your debt can directly benefit your credit utilization ratio, a critical factor in your credit score configuration.
      • Emotional Relief: The stress of debt can be overwhelming. By using your tax return to lessen this burden, you can achieve a significant psychological lift, knowing you’re on a clearer path to financial freedom.
      •  Long-Term Financial Health: Choosing to allocate your tax return towards debt repayment signals a commitment to your long-time financial wellbeing over immediate gratification. It’s a strategic choice that aligns with our mission at CBE Group to assist or customers in achieving stable financial futures.

Strategies for Maximizing your Tax Return

      • Target High-Interest Debt First: Prioritize the debts with the highest interest rates to maximize the financial impact of your repayment.
      • Adopt a Debt Repayment Plan: Whether you prefer the snowball method (paying off small debts first) or the avalanche method (targeting high-interest debts first) select a strategy that motivates you to continue your debt repayment journey.
      • Plan your Budget: If your tax return doesn’t cover all of your debts, outline a budget that earmarks future income for debt reduction. Consistency in repayment is crucial.

How CBE Group Aids our Customers

At CBE Group, we want to assist our customers in achieving financial freedom. We also understand that each situation is different and conditions impacting ability to pay may change. CBE provides user-friendly payment options which are developed with your requirements during implementation.

CBE fully supports those customers that prefer to pay their outstanding balance through a live conversation with a live associate. Our empathetic associates answer questions and help you understand and resolve your account balance.

Customers can take advantage of several alternative payment options, including our online payment and negotiation portal. The 24/7 online self-service platform gives you a path to make good on your financial commitments, without involvement from a collection associate. The tool provides multiple repayment and settlement options through a negotiation engine in a user-friendly environment that enhances your experience and ultimate recovery, while reducing the time spent making a payment.


About CBE Companies

CBE Companies is a provider of outsourced contact center solutions, composed of three subsidiaries – CBE Group, CBE Customer Solutions, and LocateSmarter, dedicated to delivering exceptional customer experiences through innovation and operational excellence. For more information, visit and connect with us on Facebook and LinkedIn (@cbecompanies).

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