Give your finances a spring cleaning Spring isn't usually a time for doom and gloom, but that seems to be the tone of almost everything said about the economy these days.

The dollar is declining in value relative to foreign currencies. A combination of flawed lending practices and zealous buyers has led to a large number of foreclosures and defaults on home loans. Nationally, unemployment has risen and a major investment bank, Bear Stearns & Co. Inc., nearly failed in mid-March. These influences and more have led to a gradual sag in the stock market recently.

Utah, in large part, has continued to have a relatively strong economy and hasn't been affected as strongly as other parts of the nation. But now may be a good time to do a little spring cleaning for your budget -- especially because a forecasted rise in fuel costs means that summer vacation you're planning may be rather expensive.

The first thing economists want consumers to know is that it's not time to panic. In fact, one panicked weekend when many investors tried to withdraw their money at once is what caused Bear Stearns's troubles. But, more than that, fears about the economy can turn out to be self-fulfilling. Michael Ransom, chair of the Brigham Young University economics department, said a slow economy can quickly lead to a downward spiral.

"When we start to see a decline in the total number of jobs in the economy," Ransom said, "that spreads from one sector to another. As we're seeing people lose their jobs, they spend less money, so that makes other firms less profitable. And they lay off some workers. And that can spread."

The second thing consumers should know is that by using some sound personal financial strategies, it's possible to weather the storm. Ransom and other local experts shared some tips on how to make (and keep) your budget spick-and-span.

But before that, some good news to get you started: Many Americans will be eligible to receive some free money from the government in May. Most taxpayers could receive between $300 and $1,500 from Uncle Sam depending on a number of factors. All you have to do is file a tax return. You can determine the amount you're eligible to receive by visiting www.irs.gov/app/espc and providing some information on your income for the year.

Preston Cochrane, president of AAA Fair Credit Foundation, a non-profit financial counseling agency, said the stimulus check can be a big help in getting your budget on track, if you use it wisely. And "wisely" will mean different things for different people.

"About half the people we talk to say they'll save it," Cochrane said. "And half say they'll spend it. And you've got some people who will do a combination of both."

Cochrane said for some, the best use of the money might be to pay for closing costs on a refinanced mortgage. Thanks to rate cuts by the Federal Reserve Board, interest rates are much lower than they were a year ago, so some people may benefit from refinancing a home or even a car loan.

Another excellent use of the money, Ransom said, is to pay off high-interest debt, such as credit card debt or debts for consumer products such as furniture. You could save substantial amounts of interest by eliminating those debts.

So once you've used the stimulus check to remove the biggest dust bunnies, here's a budget cleanliness plan to make your pocketbook sparkle.

Step 1: Create a budget plan

You've heard this one before -- sticking to a plan for expenses might be the most-repeated, least-followed bit of financial advice.

"We always tell people that doing the budgeting is the scariest thing for anyone to do," said LoAn Le, program manager and budget counselor for the charitable agency Community Action Services in Provo. "Because it really re-affirms to you that you don't have money."

But the experts all agreed -- budgeting is the first and most important step in managing your money. The point is to avoid impulse buys or casual purchases that add up to a lot of missing money.

"The reason a lot of folks don't have the money to do what they want to do is that they have a lot of slow leaks in their spending plan," said Dean Miner, who teaches finance classes at the Utah State University extension in Provo. "So track your spending, and that may take writing everything down to find the places money is disappearing from your pockets."

As you budget, try to account for where every dollar of your paycheck will go, whether to rent, food, entertainment or savings. During this process, there are a couple of things to remember.

"You need to reward yourself," Le said. "Because if you do everything to earn your money and don't get to have any reward from your hard work, that work gets harder."

But, she cautions, there may be cheaper ways to have your rewards. Miner suggests following what he calls a "step-down method." That means scaling back but not eliminating spending in your favorite categories. So if your family loves to go to the movies, maybe you could skip the expensive popcorn. Or attend a matinee. Or go less frequently. Or rent instead of going out.

"So you save some money that way, but you don't give up the activity altogether," Miner said. "That's more likely to be continued than if you cut it out altogether. So look at your discretionary spending and not so much give it up as step it down."

Le said she tells people not to cash their payday check until they know exactly where all the money is going to go, because that reduces impulse spending. Sticking to your budget plan will take some work, and our experts had these tips:

If you use cash to pay for most things, create envelopes for each expenditure category in your budget and distribute your paycheck among those envelopes. Then use only the money in the envelope to pay expenses in that category. So when the entertainment money is gone, it's gone.

If you use credit cards, keep track of your expenditures in a checkbook register. Maintain a running total as though the money had already been deducted from your balance. "It forces you to be aware of where you stand," Miner said. "If you only look at your balance at the end of the month when your bill comes, it can get away from you."

Step 2: Set goals for your money

Miner suggests getting everyone in the family together and discussing what should be done with the family's income. Priorities will differ for each family, but goals may be short term, such as saving for a family vacation or a new play set for the backyard, or longer term, such as saving for college or to purchase a home.

"Once you've decided that, and have some idea of what it will cost you to achieve that, you can ask yourself the question, 'Do I really want this pizza tonight?' " Miner said. "Put your money where you really want it and not where you may have some short term-satisfaction things."

Once your goal is set, remind yourself of it frequently. Miner suggested putting a business-card-sized reminder next to your credit card in your wallet, so every time you go to make a purchase, you're reminded of what your goal is.

One of your goals could be the elimination of debt, which Ransom said should be a priority. Reducing the interest you pay on consumer debt is as good a way to increase your income as any.

"Certainly, if you've got a balance on your credit card, you ought to put it there," Ransom said. "Put it where it will reduce your interest payments the most."

Step 3: Save and invest

Cochrane recommends that everyone save at least 10 percent of their income. That savings should ideally come while paying off debts, too, because as Miner says, getting into a habit of saving early is invaluable.

"The math might not make sense," Miner said. "Maybe you could save more money by paying off the credit card than by earning interest in a savings account. But the benefits of getting into that habit early are so profound. So even if you can't put very much away, you want to start saving even when you still have debt to eliminate."

There's various ways to go about saving. One strategy is to have a certain amount deducted from every paycheck and sent straight to a savings account via direct deposit. Another strategy, Miner said, is to save a certain percentage of any unexpected income, such as the economic stimulus check or money from birthday gifts.

Ransom and many other advisors recommend having two- to three-months' worth of income saved, which could be used to bail you out if you lose your job or experience extreme hardship. Miner also recommends saving $500 to $1,000 in a rainy-day fund to help you stick to your budget.

"So when there's a plumbing repair, or a medical expense, you can make that without putting it on your credit card or going to a payday-type lender," he said.

Such an account would need to be accessible on short notice, so it wouldn't earn much interest. Other types of accounts, however, such as investment accounts, can earn quite a bit of interest.

When saving for the long term, investing in the stock market is a good way to put your money to work for you. There are several ways to invest, including buying individual stocks and using a mutual or index fund. Seek professional advice before making any investments.

Ransom said even though the market is volatile right now, it's always a good time to invest if you're in it for the long term. Over long periods of time, the stock market tends to grow and provide good returns on investment. He said he personally invests in an index fund, which distributes his money among many companies and has relatively low risk.

"Most of us need to take the long-term view," Ransom said. "Could I lose my job? Yes, so we should make sure we're in a financial situation that we could deal with that when the time comes. And that means having some money set aside and having as little debt as possible."