CLARKONOMICS: If you're a business owner, you know that passing price increases to customers is difficult during touch economic times. Savvy shoppers may notice that Frito-Lay is reducing ounces and upping the price. Perhaps they're secretly trying to give you a hint about that diet you've been putting off?! Just kidding.

Gas stations are also squeezing costs in their own way. Some locations are offering cash discounts at the pump, which saves them the expense of processing credit card numbers. They can then pass a piece of those savings along to you. It costs a gas station about 10 or 12 cents per gallon to run your card. So it's really a win/win situation.

The spiraling rate of inflation has led to economic dislocation. The government is reporting the inflation rate at around 4%, but Barron's says it's actually over 10%. There's political benefit in lying about the rate of inflation, and it also cheats Social Security recipients out of the proper inflation adjustment. But we see the inflation everyday when we go out.

Businesses are in real bind because they have rising costs at time when there's less demand. Just look at the airlines and their huge fuel bills. Southwest is the only one that made a meager profit. Continental is not merging with United because the latter loses $6-$7 million a day!

Yet the average person pays fares that are up only 3% over a year ago. Why? Demand is too soft for the airlines to charge any more. When push comes to shove, airlines may be willing to park planes in the desert. This will reduce the number of available seats and allow them to charge more money for fewer seats. Every business faces this kind of choice in a recession.

So you must be an educated consumer and cherry-pick the deals. Patient leisure travelers can do this when it comes to flying. Shoppers can do this by avoiding overpriced groceries until they go on sale. It's like a chess game and you've got to out-think the business owner who is trying to sell to you.

Do you have money to invest, but you're not sure where to put it? Most people who are unsure about investments hire someone to help. One of the greatest danger points is in mid-career, when you find yourself with a great deal of money in a 401K. At that time you're at the greatest risk, because that's when you're most likely to end up hiring a commissioned salesperson. Is that a problem in itself? No. There are plenty of situations when paying a commission is just fine. But in the investment world, there can be inherent conflict of interest with commissions. There are plenty of investment products that may not be the best choice for you, but you may be sold on them because the commissions are humongous. Variable and Index Annuities are referred to as 'sold', not 'bought', since people don't buy these on their own -- they are convinced to do so. Salespeople use code words such as Retirement Secured Account and other phony phrases to keep from tipping you off that you're being sold an annuity. Sometimes a Life, or Immediate Annuity makes sense, but the commissions are so low you won't hear much about them.

Clark wants to warn you away from another term: "fee-based planners." These salespeople start with a fixed fee, but the commissions on products they may sell you defray those initial costs, which again, may not be in your best interest. Honest commissioned salespeople will rise above their personal interests and sell what's right for you.

The stakes are so high in investing that Clark urges you to consider fee-only planners. They'll give you a fixed price up front for their services, regardless of the product they recommend. You won't have to worry about conflict of interest. Their success will depend on your good word of mouth and how well they did by you. To find a good one, go to the National Association of Personal Financial Advisers website, NAPFA.org. Another good resource is Garrett Planning Network: garrettplanningnetwork.com

Clark saw a disturbing story in The Los Angeles Times about how the rate of disconnect for utilities is up 50% year over year around the country. In Chicago, they've seen a 33% increase; in Detroit, 56%; and in Southern California, 15%.

This is partly because of the slowing economy. The solution is to trim your budget. Of course, there's a segment of the population that lives life so close to the edge that maybe there's nowhere you can cut.

But for most of us who are pinched, it's because we haven't analyzed how we spend and where we can change things. For example, 30 years ago people lived without the Internet, cell phones and pay television. Isn't it amazing how our expectations have changed so much in just one generation?

Think and re-think how you spend. Here are some pointers:

• If you spend $43/month on Internet, why not go Neanderthal and switch to dialup? You could save up to $400/year by doing so.

• When it comes to your cell phone, try a pre-paid plan like Net10.com.

• Stop paying for 1,000 channels of TV -- there's nothing on to watch anyway!

Clark mentions these 3 things just to get you thinking. We look at them as must haves. But survival only requires food, health, shelter and clothing. Not cable, cell and Internet.

The poster child for being thrifty is Clark's associate producer Joel. He's 24 and has not yet learned to blow every penny. While he does have a cell phone, he doesn't pay for TV or Internet. He also drives a used car he bought for $3,200 and typically wears used clothing. Clark even calls Joel "cheap." That's high praise coming from the penny-pincher himself!

Clark's now been using Mint.com for several months and loves it. Here's how it works: You register all your accounts with them and they analyze your spending to tell you if you'll meet your financial goals.

After Clark's high praise for the free service, Christa finally checked out Mint and also loves it. She thinks it's even easier to use than Quicken or Microsoft Money.

In addition to tracking your spending, Mint will also send you simple reminders when your bills are due. One of Clark's credit card bills got lost in the mail, but Mint reminded him so he didn't have to get a late fee.

So the Internet just offers one more tool that can help you gain control over your spending. But don't overlook the old-fashioned envelope method or the notebook method of keeping track of your expenses.

CLARKONOMICS: There's a new report out about the difficulty that we're having handling everyday expenses. About 10% of baby boomers can't meet the most basic daily expenses. That translates to millions of people being so broke that they have to rely on family, friends or charities to make ends meet. The grown kids of baby boomers are having even more trouble. In 4 of 10 cases, the parents have to provide money for their children to pay bills.

Yet, overall, we're wealthier than we were a generation ago. The problem came when we started taking on too many obligations of every kind. We bought larger homes even though the average family size has been getting smaller. With cars, we've managed to snatch defeat from the jaws of victory by purchasing overly fancy vehicles. The average car purchase in the Unites States is just under $27K, and that's before interest on a loan and taxes. But you can buy a vehicle so much cheaper if you don't load it up with extras. And nowhere in the Constitution is it written that you need to get new wheels every 3 years!

So be realistic about your obligations. Are you stretched past the breaking point? Analyze every bill -- cable, satellite, Internet, cell phone, etc. -- and see where you can trim. For example, cable and satellite are not more essential than food on the table. Perhaps you can cut back on your programming package. Think about ways you can make little nips and tucks.

Budgeting is a topic that's front and center again for many Americans. Many people think of budgeting like being in prison, but Clark thinks it's freeing. Budgeting lets you reduce your financial insecurity and gain control back. There are great, free budgeting tools online like Mint.com and Wesabe.com.

A Journal of Consumer Research study shows that budgeting annually is better than doing it monthly. That's because there are expenses that pop up over the course of a year that you can't account for on a monthly budget. Data shows that people are far more accurate when they budget annually vs. monthly.

Clark doesn't usually carry any debt, but he still uses budgeting tools to see what happened with his money over the course of a year. Christa, meanwhile, likes to track her finances using a spiral notebook and some online monitoring. Others like to go back to basics using the envelope method. There's no one right answer, but you have to find what works best for you. Do you have a system? Are you doing anything at all to monitor your money? Give it a try.

People are always looking for good web-based budget tools so they can get control of their spending. Clark hears people telling him that their money disappears as they move up the pay scale. It doesn't matter whether they make $25,000, $50,000 or $100,000 a year! Where does the money go and how can you easily keep track of it? There are a number of websites that can assist you in this task. Clark has been talking about Wesabe.com for a couple of weeks. Now Mint.com is a new one he recently discovered. You register anonymously and give Mint access to monitor all of your accounts. They use artificial intelligence software to analyze where your money goes on a daily basis. Sometimes people aren't really ready to face up to where their money is going. That's a personal choice. Clark just wants to give you the tools you need to take control of your finances. Other options include Yodlee.com and ClearCheckbook.com. All these sites say they're safe for you to use. Are they really? Clark's willing to take the chance because a greater risk is posed by uncontrolled spending.

With Christmas fast approaching, Clark wants to tell you how to manage your holiday shopping list without going over budget. But first he has a dirty little secret to reveal: Half of all holiday shopping you do when they're supposedly shopping for others is actually for you! While this isn't true of everyone, this is a very typical pattern. So be honest with yourself and come up with a holiday shopping list that includes everyone you want to shop for and yourself. How much money can you afford to spend on yourself and others for Christmas? Decide what the total dollar amount is and stick to it. That way you'll avoid that January hangover effect when the credit card bills come due. Once you have your list and the grand total, you've got to put a dollar amount down for each person. When push comes to shove, you may have to drop people off the list or reduce the dollar amount by each name—including yours—until it fits within your intended budget. Bring this list with you when you shop. Consult it when you make a purchase. If you overspend one on person, cut somewhere else. If you spend less than you anticipate on someone, you have more money left to spend on somebody else. Clark loves it every season when people come up to him in the stores and show him their lists! One last hint: You may also want to purge the plastic from your purse or wallet and try paying for holiday shopping with cash only. When there's no cash left, there can be no more purchases. Clark recently spoke to a credit counselor who sees tons of clients by March because they can't handle their holiday bills. Don't let this be you!

Sometimes it seems like young people have a huge bull's eye on their backs for the banks. People who are between the ages of 18 and 24 are being killed with bank overdraft fees. The latest stats say they're paying more than one billion dollars in overdraft fees every year. Clark recently heard from someone who has a teen that overdrew a debit account by $15 and that generated $80 in fees. As a parent, it's getting more and more difficult to teach the young about money. But it must be done. When Clark was in school, you paid for things with cash. Today there's no equivalent in a credit-crazy world. While cash is finite, plastic is infinite. A parent's most important lesson to a son or daughter should involve a pen and a check register -- showing them how to take debit transactions seriously. Banks are only too happy to approve transactions that will result in overdrawn accounts and high fees.

There's a bill in Congress that's trying to make it so that a bank must contact you for approval before they overdraw your account. The banks, predictably, are incensed about this because they may lose profit. Clark loves it when people have more info to make smart (or dumb) choices. What happened to ethics and morality in the banking world? Why do bankers get up in the morning and try to figure out how to rip off fellow Americans? If a bank approves an overdrawn transaction that generates fees, how is that moral or ethical?? It's not. The bill will probably be killed because the bankers are so strong giving dirty money to politicians. So teach your children well and you'll save them from losing money in the school of hard knocks.

People often contact Clark asking about good free budgeting tools online. Clark recently discovered one free site that he really likes called Wesabe.com. If you're curious about that name, it apparently derives from saber, the Spanish word for "to know." So the name is a Spanglish-ism that roughly translates to "we know." Wesabe.com offers you the opportunity to assess your finances and make sure you're on the right track. It's a community-based site, so that means you'll find users of the site helping each other. Clark wants people to know that there's no one right way to save for the future. Some people like the envelope system, while other use the pay-yourself-first method. Wesabe.com is just another tool in the toolbox that you might be able to put to work. Another site Clark likes is FinancialEngines.com, which can help you plan your retirement. It uses the Monte Carlo analysis method, and tries to prepare you to meet your financial goals even when factoring in the odds of a market crash.

Salaries change much more these days than they used to. Think about how yours may have fluctuated. It's three times more likely you'll have up to a 50% swing in income year-to-year than it was a generation ago. Also, the debt rate per person is way up from last generation. This doesn’t correlate. We have more financial volatility, but less of a safety net than ever before. Clark wants you to think about how this could affect you. Do you buy furniture or electronics on instant credit, cars with long term loans, or houses with no money down? Clark wants you to ask yourself: if your paycheck stopped tomorrow, what's your back up plan? How long could you handle your bills and obligations? One hour? One day? A month? A year? If the answer is "not that long", Clark says dial back on your debt, and dial up on your savings.

Roughly 1 in 7 Americans are carrying credit card balances exceeding $25,000. Since the average income is around $50,000 a year, that means that 1 in 7 have a debt amounting to about half their salary. Once you get to that point, you've dug yourself a hole that's pretty hard to get out of. When financial counselors ask people what their debt level is, most don't know, or pretend not to know, because the real figures are just too frightening. And what's troublesome is that not only is the amount of average debt rising, but the number of debtors is rising too. Only 31% are paying off their monthly balance now, down from over 40% not too long ago. So if you're carrying a debt load, Clark is assigning you homework: redefine how you deal with money. Think about the interest you're paying to credit card companies and imagine what else you could do with those funds. Nobody gets rich paying Visa or MasterCard interest. If you are carrying a credit card balance, here's what Clark would like you to do: women, go to your closet of clothes, and guys, head to your closet of "stuff." See how many things there are in there that you bought but don't use. If there's a lot, it could be an indicator of a problem. And while your debt was built up slowly, the answer is quick: cut up your credit cards. if that's too tough of a chore, how about putting the credit cards in a bag of water and freeze them in your freezer...then your credit will be truly frozen! And if you have extra stuff, sell it on ebay or Craigslist, and use it to pay off your balance. It won't make a significant difference, but you will start to heal yourself of the habit of buying things you thought you wanted but didn't really need. He promises you'll feel much better. What if you have a huge debt? You stand a chance to whittle that away if you go on a budget and give yourself a cash allowance each pay period. Contract with yourself to take out only what you'll really need, then stick to it. It will amaze you how much less you spend. Sure, you may have to eat at home or take a sack lunch to work at the end of the pay periods, but so what? Clark wants you to be strong and take hold of your financial future. If you feel burdened by debt, think of the calls he gets from those that got out from under, and how liberated they feel. Be inspired by that. If you still feel overwhelmed, get yourself a credit counselor at nfcc.org. Most affiliates have counselors you can talk to for free. Time's a-wastin', so take control.

A study by the Economic Policy Institute found that women are at far greater risk of ending up destitute than men. Women live longer than men and, therefore, outlive their savings. Women also have a pretty good chance of having children. That’s a wonderful thing, but it can hinder a career. It equates to less money over time for women and less money in a 401k plan. In sum, women need to save more aggressively than men. Wealth in a capitalist society flows to owners, so women should own stock in a number of companies. That’s why Clark loves index funds. People have a lot of fear when it comes to investing and it can be especially intimidating for single women. But, it’s a no-lose situation. Stocks – especially in index funds – do well over time. So, if you are 35 and you’ll probably retire in 25 to 30 years, it doesn’t matter if your stocks have a bad year at age 36 or even through age 40. You’ll be better off over time.

Economists are saying the economy is in great shape and the GDP (gross domestic product) is going great guns. Yet individuals and families are seriously struggling. So there is a disconnect causing wealth to be distributed unevenly. The wealth is tilting toward very wealthy people and corporate enterprises. That’s why the luxury stores have been reporting great sales. And many companies have more money than they know what to do with right now. But on the other end, items cost more and gas is much higher. In addition, imports are about to cost more and any variable interest rates can negatively affect you. The silver lining is that if you’re a saver, you’re actually earning money on your money. But you still need a game plan. Cutting spending so you can put more money toward your debt is the key goal. Clark suggests writing down everything you spend money on for two weeks and review what you’re spending. Carry a little spiral notebook in your purse or on your person and record everything. Then, mark up the items you don’t really need and stop buying them. It will add up.

A new report out from A.C. Nielsen compares numerous countries throughout the world and how they do saving money. Would you believe that, of all the countries surveyed, a greater percentage of Americans end each month penniless than people in most other countries. Roughly one in four Americans end each month without a penny. The only country with a worse rate is Portugal. So, basically we are worse at saving money than just about every country in the world. It’s due in part to the fact that we have more access to borrowing money than just about any country. On top of that, we pay more in interest on what we spend than most other countries. So, it’s like a Bermuda triangle. It’s our “I have to have it” mentality that puts us in these positions. If you’re one of those people who end up with no money each month, it’s time to keep track of everything you spend in a notebook. Just find a small notepad and write down everything you buy for two weeks. After two weeks, you put an A, B or C next to each item. “A” items are those you definitely need, “B” items you could probably do without, and “C” items are those you could definitely do without. Any item at the mall, for example, is a “C” item. There is nothing there that you actually need. At the end of two weeks, add up all of the “C” items and that is what you could be saving.

Clark gets lots of questions from consumers about how much “rainy day money” they should have. Financial planning types say six months is a good idea. Clark isn’t a financial planner, but he would base that figure on the amount of debt you have. For instance, if you have no debt and you’re putting money into a 401k but you have no money in a savings account, it’s not a terrible thing. You can take on some debt and still be okay. Clark believes that it’s more important for you to extinguish debt than it is to have a large rainy day fund. Owing nothing to your credit card company means financial freedom. Having a small amount on reserve is always good idea. But work instead on getting rid of debt first.

People are crying out for a way to get a better handle on their money. And Elizabeth Warren is someone Clark mentions a lot in regards to the subject. Warren, a professor and author, is considered the nation’s expert on bankruptcy. She has written a “road map” for people who are so far gone that it seems hopeless. The road map is in her latest book, “All You’re Worth - The Ultimate Lifetime Planning Guide,” which is #28 on Amazon’s best seller list. Her theory is that you must live a certain lifestyle that includes several tenets. The first is that your “must pays” are no more than half of your after-tax income. “Must pays” include rent, car payments, utilities, car insurance and other debts. So, you have to consider if a new purchase – like a car – is within that 50 percent scenario. Secondly, you have 30 percent of your after-tax income for expenses, and you can spend that on whatever you like. That’s the one thing Warren says that Clark doesn’t espouse, but it may make sense to you. Lastly, you must save 20 percent of what you make. So, 50 percent of you income to live on, 30 percent for whatever, and 20 percent for your future. Many people feel trapped by a budget like this. But, in actuality, budgets give us structure and financial freedom.

Clark saw a story recently entitled, “Why it’s Good To Be Rich.” Financial writer Jonathan Clements wrote the article and he lists 25 reasons why it’s so great to be rich. What was interesting about the article is that just about anyone can do the 25 things if they just put their minds to it. The No. 1 thing to do is pay off our credit cards each month. But people just don’t do that. Roughly 2 out of 3 people have an outstanding balance on credit cards, and they’re throwing money away as a result. The second reason is that you can send your kids to school without taking out student loans. The third reason is you can trim insurance costs by raising deductibles on policies. Rich people can also take advantage of tax-favored accounts such as Roth IRAs and 529 plans. The list goes on and on. But anyone can do these things and it will lead to wealth. It’s not just rich people who can make these things happen.

How can you easily gain power over your finances? It may sound like a huge challenge, but there is an unbelievably simple solution. Just take your lunch to work. That’s right. Young people spend almost a dime of every dollar they make on eating out during the workweek. If they brought a bag lunch, they would be on their way to financial freedom. Say you spend about $85 a week on lunches out and take-out food, which is the amount one person profiled in the Chicago Tribune spent. That’s more than $4,300 a year that you could keep in your pocket if you shopped ahead of time and brought your meals with you. Simply cutting out dessert and wine at dinner will also help. It really is the little things that count.

The U.S. Federal Reserve is in the long process of raising interest rates right now. The Feds indirectly control so many things with this rate. And if you look at what economists are saying, interest rates are several points below what they need to be for us to reach what’s called “equilibrium.” So, with all of the news about the increases, interest rates will probably only go up about 3.5 points. Who knows how long it will take with the possibility of terrorist attacks and a changing economy. But, thinking ahead, if you’re paying 4 percent on a home equity line of credit, you’re probably going to pay up to 8 percent by next year. If you have a floating credit card, a 9.9 percentage rate could go up to 13 or 14 percent. For savers, the news is good. Interest rates on CDs have already stepped up. The 5-year CD could move up to 6 percent. So, you’ll make more on your money. But people are still up in arms over the economy, according to the Dow Jones News Wires. People who make more than $50,000 a year feel okay with how the economy is going. But those who make less than that feel up against the wall financially. Education seems to play a huge role in this. What percent of Americans have a college degree? It’s about 27 percent. The one in four who have a degree tend to make more money and, as the economy improves, so do their finances. For those without a degree, it’s very hit or miss. What people are experiencing in their own lives is what determines how safe they feel. And, having a degree clearly gives people a more secure feeling.

New statistics from the Commerce Department show that the typical American family is saving just a little more than a penny on each dollar earned. This worries Clark very much because it simply will not help you. Of course, there are some people who are saving huge amounts of money. But there are many more who are not saving anything or are involved in “negative net saving.” That means that people spend more money than they make. So, overall, we are pitiful at saving money in the United States. Good and bad habits are formed one step at a time, and that’s how you change them, as well. Saving a dime on every dollar is a good goal to have. As the years pass, you’ll be able to bump that number up. Last year, Clark saved 15 percent of his before tax pay and two-thirds of his after tax pay. When you retire, you will have to live on half of what you make. You must keep that in mind.

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In Clark’s most recent poll, he wanted to know what you do in your leisure time. When asked how much time you spend in front of the TV, almost half said they only watch one to two hours a day. That is far less than the national average, so Clark’s listeners are a bit different. And, in terms of how you end up spending your leisure time, about 27 percent - the largest amount - said they played or worked on the computer.