Second-chance resolutions for smart consumers


Posted Jan. 11, 2016, at 7:27 a.m.
Have you abandoned all your New Year’s resolutions? Here’s a chance to start over (good consumers deserve second chances).

Take the pledge to be more aware of your spending, saving and other monetary decisions. We’re well aware of the ads, store displays and peer pressure during the recent holidays. Let’s agree to be attentive to our finances year-round.

A great goal for the end of 2016 is a “rainy day fund,” savings equal to one month’s wages. Setting a few dollars aside each week can get you started, and the extra money could be critical in an emergency. Financial advisers say we should all eventually set aside two to four months pay for unforeseen events.

Setting up such a fund is one recommendation of David Leach, principal examiner at Maine’s Bureau of Consumer Credit Protection. Leach says consumers can save themselves a lot of grief by following the most basic of advice: Always spend less than you earn. Follow that rule, and you can have part of your paycheck withheld and put automatically into a retirement account.

Leach and others at the Bureau of Consumer Credit Protection have been watching interest rates with, well, interest. While it’s too soon to get any clear indication how consumers will react to the Fed’s raising of the prime rate by 0.25 percent, Leach cautions consumers not to rush into a major spending spree in anticipation of more rate hikes.

Economists seem to be leaning toward predictions of a few quarter-point increases in coming months. Over time, those increases in the prime lending rate will make their way into the rates consumers pay for loans.

In the near term, Leach predicts those consumer rates won’t change much. That could prompt people to buy durable goods — cars, appliances, other big items — while rates are low. It might trigger other consumer action as well.

“My advice to consumers is to always shop around for the lowest annual percentage rate, or APR, when looking to finance their next home, automobile, snowmobile, or when selecting a new credit card,” Leach told me.

He said big-ticket purchases should come only after thorough investigation of both the items and consumers’ ability to repay any loans needed to buy them.

Leach offers several other money-saving resolutions for Mainers for 2016:

— Pay cash or use a personal check or debit card whenever possible; reduce or eliminate interest paid on credit cards.

— If you’re buying a vehicle, try to make at least a 20 percent down payment in cash or through a trade-in.

— On outstanding auto or home mortgage loans, pay a little extra each month, to shorten the term of the loan and thus save on interest payments.

— Avoid impulse buying at grocery and department stores. When you shop, make a list and stick to it.

Leach’s colleagues at the Bureau of Consumer Credit Protection can help with a variety of consumer credit issues. Reach them by phone at 800-DEBT-LAW (800-332-8529) toll-free in Maine, or find the bureau online at

Consumer Forum is a collaboration of the Bangor Daily News and Northeast CONTACT, Maine’s all-volunteer, nonprofit consumer organization. For assistance with consumer-related issues, including consumer fraud and identity theft, or for information, write Consumer Forum, P.O. Box 486, Brewer, ME 04412, visit or email


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