As tax season continues, many Americans look forward to a hefty refund. But Suze Orman, financial expert and the best-selling author of "Women and Money," says getting that check from the government shouldn't be a reason to rejoice.
"If you're getting a tax refund, you are making one of the biggest mistakes out there," she tells CNBC Make It.
That's because a refund is an indication that you've basically given the government an interest-free loan.
Here's why: If you typically receive a substantial refund, it means that more taxes are taken out of your paychecks than you actually owe. The government uses that money throughout the year and then, when you file your taxes in April, it pays you back the extra amount you contributed.
If you adjust the amount that's withheld from your income so less is taken out, you'll get a smaller refund, or no refund at all, but you'll see more money in each paycheck.
Though getting a refund may feel like a windfall — the average one is around $2,600 — Orman argues that you could put that money to better use throughout the year. After all, "it's not as if the government pays you interest on that money," she says. "You have money that they are holding for you just to get a refund, when you could be getting that extra $100 or $200 a month."