State Treasurer Dean Martin just put out a helpful list of New Year's resolutions that anyone could use to keep their finances in check -- especially state lawmakers.
State budget watchdogs like Martin and others have been sounding the alarm, but outgoing Governor Janet Napolitano and a fiscally irresponsible state Legislature have allowed government spending to grow way out of control. Sure, all those social programs are wonderful -- and there's no lack of needs out there -- but simply piling on more debt doesn't work.
Which leads to Martin's Number One resolution: Spend less than you make.
Excellent advice. But that sage wisdom and Martin's other resolutions have major shortcomings when applied to the real world, as we point out:
State Treasurer Dean Martin's Top 10 New Year's Financial Resolutions
1. Spend less than you make: Spend less than you earn to improve your financial situation. Just because you have checks left in your checkbook, or room on your card, does not mean you should spend it.
Try telling to that to a collection agent.
2. Write out your goals and track your spending: Use financial software or even a little notebook.
That didn't work for Lehman Brothers, either.
3. Start or increase your emergency fund: Have a minimum of 3 months worth of expenses for job loss, emergency medical or home/car repair.
The key with this one: Don't have more than one financial emergency every few years.
4. Reduce your debts: Make a list and check it twice. Prioritize by interest rate (pay down highest first).
About as easy as reducing your waistline.
5. Reduce spending leaks: Most budgets are constantly leaking small dollar amounts that really add up each month or year.
Let us think about that one over a Cartel coffee.
6. Re-examine your "essentials": Is that "must have" daily Starbucks really needed this year? Can you brew your own coffee? Cook more, eat out less. Small daily changes can add up to big savings in your budget.
This one's all about the deprivation. Yuck.
7. If you're in trouble, ask for help: Contact your lender or credit card company to arrange a payment plan. They don't want you to default any more than you do. Get free financial education resources at www.AzTreasury.gov.
Would the treasurer's Web site look better on a 15-inch screen? Hmm, better go for 17-inch.
8. Don't ignore your bills: When you miss just one payment, regardless of the dollar amount, it takes 24 months to restore your credit. If you are late on payments, your interest rate - and future payments - might go up.
Isn't that awful? If you can't make your payments, they ought to charge you less!
9. Diversify your investments: The best way to ride out any financial storm is to have a very broadly diversified portfolio.
Exactly. Have a Visa and an American Express card.
10. Get a FREE credit report at AnnualCreditReport.com: Just as you would get an annual health physical, this is like a fiscal checkup! The information on this report determines the interest rates that credit card companies will charge. You can get a FREE credit report once every 12 months from each of the nationwide consumer credit reporting companies: Equifax, Experian and TransUnion. Make sure you haven't been a victim of identity theft and that your credit information is correct.
Tweakers stay awake 24 hours a day plotting to steal your identity, and you can check your credit report for free once a year. Thanks a lot, credit bureaus.
If any readers out there plan on trying to stick to the treasurer's resolutions, feel free to get back to us and let us know how it's going. -- Ray Stern