I mean really; what’s not to love about it?
October is the first full month of autumn and you know what that brings: milder temperatures, cooler evenings, beautiful colors and, um, a never-ending stream of shameless cut-throat political advertisements.
I know. But an informed electorate is absolutely essential for ensuring the health of any representative democracy.
Of course, it’s just as important to make the right decisions when it comes to your personal finances. So, in order to help, I’ve developed the following handy personal finance voter guide:
Proposition 1: THE PERSONAL FINANCES IGNORANCE ACT
Ballot Summary: This act provides additional free time to household CEOs that choose to forgo the work required to maintain a proper budget.
My Opinion: I’ve said it before and I’ll say it again: trying to get a handle on your personal finances without knowing how much money you are earning and where it is all going is tantamount to trying to drive with a blindfold around your eyes.
Vote “Yes” If: You’ve got a mind like a steel trap when it comes to tracking expenses (or, at the very least, the bank account of Warren Buffett).
Vote “No” If: You’re living on a modest income and want to maintain a sense of financial discipline.
Proposition 2: BUY NOW, LET IT RIDE, AND (MAYBE) WORRY ABOUT THE CONSEQUENCES LATER ACT
Ballot Summary: This act encourages consumers to buy goods and services on credit when they are unable to pay off the balance in full at the end of the month.
My Opinion: If you can’t afford to pay cash for something, then you can’t afford it.
Vote “Yes” If: You don’t mind potentially becoming an indentured servant to your credit card company.
Vote “No” If: You have no desire to sacrifice your future financial flexibility in exchange for impulsive short term gratification.
Proposition 3: THE “IN GOD WE TRUST OUR CREDIT REPORT TO BE ACCURATE” ACT
Ballot Summary: This act reinforces the public’s indifference toward checking personal credit report information at least once per year.
My Opinion: Inaccurate credit records can result in lower credit scores and higher interest rates. Not only that, but by failing to periodically check your credit report you deprive yourself of the ability to potentially stop an identity thief from devastating your good credit.
Vote “Yes” If: You don’t mind paying for unwarranted higher interest rates — or letting identity thieves leech off your good credit.
Vote “No” If: If you truly value your credit rating.
Proposition 4: THE PAY YOURSELF FIRST ACT
Ballot Summary: This act makes it mandatory for people to save a portion of their income in a savings or retirement account each month before they pay any of their bills.
My Opinion: The government pays itself first every time it withholds money from your paycheck. Why shouldn’t you do the same? Start by taking advantage of your employer’s matching contribution to your retirement savings plan, and also building an emergency fund amounting to at least three months of expenses. Take advantage of the automatic deductions and start slowly, then gradually increase your savings rate over time.
Vote “Yes” If: You are serious about building your savings as quickly as possible.
Vote “No” If: You don’t mind the thought of working into your 70s.
Proposition 5: THE HOUSEHOLD BUDGET ARMAGEDDON ACT
Ballot Summary: This act would give full and unconditional pardons to the Four Horsemen of Personal Finance.
My Opinion: The Four Horsemen of Personal Finance can unleash Armageddon on the household budget, thereby impairing one’s ability to save any appreciable amount of money for the future.
Vote “Yes” If: You enjoy the struggle to stick to your budget and/or make ends meet.
Vote “No” If: You want to free up a significant amount of income for more important things, like your nest egg.
Proposition 6: THE WINDFALL SPENDING ACT
Ballot Summary: This act would make it a crime to devote any portion of a cash windfall to retirement and other savings accounts, or eliminating debt.
My Opinion: While it would be almost unfair to expect folks to not spend at least some portion of a large cash windfall, for most people an unexpected influx of money can usually be better spent building an adequate emergency fund and paying down debt.
Vote “Yes” If: You are not only debt free, but you’ve already got more than enough saved up for your retirement.
Vote “No” If: Financial freedom is your number one priority.
Proposition 7: STORE BRAND GROCERY PRODUCTS ARE FOR CHEAPSKATES ACT
Ballot Summary: This act will provide unspecified funds for a commercial campaign produced by a washed-up television actor nobody has ever heard of proclaiming grocery store-brand labels to be inferior to their name-brand counterparts.
My Opinion: I’ve conducted extensive taste test experiments with real expert panels that consistently show the store-brand labels often hold their own against the higher-priced name-brand labels.
Vote “Yes” If: You’re afraid you’ll lose your “street cred” if you get caught with store-brand label groceries in your shopping basket.
Vote “No” If: You’re a savvy shopper who realizes that store-brand labels often offer equivalent taste and quality for as much as 40% less.
So there you have it. And although you won’t find these propositions on your local election-day ballot, you will end up voting on them — with your wallet.
Photo Credit: Ho John Lee
(This is an updated version of an article originally posted on October 13, 2010.)