02.11.26 Tax Refunds & Withholding / Clarksplainer: Trump Accounts - The Clark Howard Podcast Recap

Podcast: The Clark Howard Podcast

Published: 2026-02-11

Duration: 32 minutes

Summary

Clark Howard provides guidance on managing unexpected higher tax refunds and understanding the implications of Trump accounts for newborns.

What Happened

Clark Howard explains that due to a new retroactive tax law, many Americans may receive unexpectedly higher tax refunds this year. He advises listeners to use these refunds wisely, either by paying off high-interest debt or investing in a Roth IRA to build tax-free wealth. Howard cautions against over-withholding on taxes, which effectively gives the government an interest-free loan, and suggests adjusting withholdings to better use the funds throughout the year.

The episode also covers the new Trump accounts, which provide $1,000 for newborns from the federal government. Howard highlights the potential tax pitfalls associated with these accounts and advises only to engage with them if there is additional free money offered from employers or other entities. Otherwise, he recommends using 529 plans for saving for a child's future education due to their tax advantages.

In a segment about telehealth, Howard praises the benefits of OneMedical, particularly when combined with health insurance, and appreciates Amazon's support of this healthcare model despite its financial losses. He also discusses direct primary care as a cost-effective alternative to traditional healthcare models.

Howard addresses a listener's inquiry about utility payments, recommending ACH transfers over credit card payments to avoid fees. He also advises on the decision between traditional and Roth 401(k) plans, recommending Roth for most due to current low tax rates.

The episode covers the challenges of canceling a deceased parent's cable service, suggesting involving local media or filing a complaint with the Better Business Bureau if customer service is uncooperative.

Finally, Howard shares a personal story about saving money on pet prescriptions at Costco, highlighting the significant savings compared to traditional veterinary pharmacies.

Key Insights

• This year, millions of Americans might be in for a pleasant surprise with their tax refunds thanks to a new retroactive tax law. But : Clark Howard warns that over-withholding is like giving Uncle Sam an interest-free loan, and suggests adjusting your withholdings to enjoy more of your own money throughout the year.
• Newborns could receive a $1,000 headstart with the new Trump accounts, but there's a catch - potential tax pitfalls lurk if additional free money isn't offered by employers. Howard advises sticking with 529 plans for educational savings, which come with tax advantages, unless that extra bonus cash is on the table.
• You might want to reconsider how you pay your utility bills - ACH transfers can save you from pesky credit card fees. Meanwhile, when choosing between a traditional and Roth 401(k), Howard recommends going Roth while tax rates are still low, for tax-free growth that pays off in the long run.
• Canceling a deceased parent's cable service can be a nightmare, but here's a secret weapon: local media or a Better Business Bureau complaint can cut through the red tape. On a lighter note, pet owners can cut costs big time by filling prescriptions at Costco instead of pricey vet pharmacies.