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My $1 tax refund

The government sent me a check for 100 pennies. And I actually cared.

By Donna_Freedman May 16, 2011 9:19AM

It's a little nervous-making to get a letter from the Internal Revenue Service. My first reaction is always, OMG I'm being audited.

Nope. "We changed your 2010 Form 1040 to match our record of your estimated tax payments, credits applied from another year, and/or payments received with an extension to file," the letter read. "As a result, you are due a refund of $1."

Some people might think, "A buck? Not worth the gas to take it to the bank."

Not me. A dollar still means something to me, even though it won't buy a convenience store soda.

What will it buy?

Two pounds of rice from the dollar store. Something from the "green shelf" at the bakery outlet. Almost a pound and a half of bananas at the nearby Asian market. Two stamps, with change back. Seven meals for the hungry if you donate it to Feeding America.

Cheap dinners and debt snowflakes

It could be seed money for your emergency fund, or an extra buck toward your debt repayment plan. A debt snowball is made up of individual snowflakes, right?

If you're really hard up, it could help make your bus fare to get to work on payday, or allow you to put an entire gallon of gas in your car instead of only three quarts.

You might not know anyone whose budget is that tight. Maybe you do, though. Maybe someone you know is that close to the edge, and terrified that someone will find out.

For this individual, a dollar might represent a week's worth of suppers. In his iconic essay "Being Poor," John Scalzi noted that poor people pick "the 10-cent ramen instead of the 12-cent ramen because that's two extra packages for every dollar."

You don't often see ramen that cheap these days, but the Asian market in my neighborhood has it five packages for a dollar. A different flavor every night of the week until payday or the unemployment check arrives. It beats having nothing at all.

Books (and blood) for sale

I remember living that close to the bone. As a single mom working at a big-city newspaper, sometimes I needed a bit more cash on a Monday to buy milk or a new transit pass. (We got paid on Wednesday. I had no credit cards.) I'd raid the baby's piggy bank and put it back when I could.

If the bank was empty, I had a couple of other scrape-up-cash techniques. The easiest one was selling books. I used to get free paperbacks from the book editor, who felt sorry for me. When times got tight I would take 10 of them to a used-book store and trade them in for a dollar in cash.

The one I didn't do unless I had to? Selling a pint of my blood. I could do this only on a workday that ended by 4 p.m. (as a "permanent part-time" worker, my schedule varied). That gave me time to get to the blood place, open a vein, collect my $6 and still get to the day care center before it closed. If you were late, they charged -- you guessed it -- a dollar a minute.

Close that wallet, already

That's probably why I still think of a dollar as being worth something. For starters, I hand out dollars when street people ask for help.

Besides, it's precisely because a dollar doesn't mean much these days that we ought to take a closer look at it. "Eh, it's only a buck" -- and before you know it you've piddled away $10 in a week on things you can't quite remember buying. A doughnut, some beef jerky, a cup of coffee, a sticker for your kid.

What could you do with an extra $500 a year?

Overspending a dollar at a time causes less damage than taking a credit card to the outlet mall. But it's still overspending. I'm as tempted as anyone else by, say, the post-holiday clearance bin. It's fun to give a vampire-headed Pez to a young relative, and it was well under a buck.

At some point I come to my senses. (Usually.) I remind myself that a dollar saved on stuff that doesn't matter is a dollar I could use for something I really want.

Not to get too old-school on you, but … I send away for $1 refunds even though the stamp costs 44 cents and the envelope about a penny. To me, it means I'm 55 cents ahead, even if I have to walk through snow up to my waist to reach the mailbox.

And please don't leave a comment saying that my time is worth more than that. When you remember selling blood to buy milk for your kid, you value every greenback.

That $1 IRS check will go into "Home," the bank account I opened for funds I get from rebates, baby-sitting money, recycling and other extracurricular gigs. Every so often I put in some cash from my day job. But mostly it's been smaller amounts that, taken together, do add up. In other words, one dollar at a time.

MSN Money columnist Donna Freedman blogs at Smart Spending and Surviving and Thriving.

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