Part of the financial overhaul legislation that went into effect last year was the introduction of a new government agency, the Consumer Financial Protection Bureau. The CFPB is designed to act as a watchdog for the finance industry and financial institutions, acting in the best interest of American consumers.

While the CFPB will not officially begin its work until July of this year, framers appointed by President Obama, including former Harvard bankruptcy professor Elizabeth Warren, have been developing and planning the bureau for some time. But now, it seems, Republican lawmakers are making noise about the Bureau and are attempting to limit the CFPB’s powers of oversight. Here’s why.

What the CFPB Is Designed to Do

The CFPB was created in response to the economic fallout linked to the questionable lending practices that touched off the Great Recession. Its stated goals include:

• Regulate consumer financial products and services: Making sure lenders, banks and other parts of the financial industry adhere to laws and rules is one major responsibility of the CFPB.
• Report to various committees: Twice a year, the CFPB must make a report to committees concerned with financial services and products in the House and Senate.
• Track consumer complaints: The CFPB will offer a toll-free hotline for consumer complaints once it’s up and running later this year.
• Conduct research: In order to better serve the public, the CFPB will study what areas are proving problematic for American consumers and investigate possible solutions.
• Promote financial literacy: Generally speaking, the CFPB will undertake the task of improving knowledge and understanding of financial products and services among American consumers.

Why Some Lawmakers Want to Limit the CFPB’s Power

Most of the jobs identified for the CFPB sound pretty innocuous if not downright helpful to the average consumer and/or consumer advocate. But Republican lawmakers in the House have proposed the following changes to the organization:

• Replace the CFPB’s head with a board of directors. Supporters claim that this move would decrease the chance of politicization of the bureau, but opponents suggest that a board would be more likely to be swayed by outside influence. Further, a group of people may be unable to reach consensus to implement strong reform.
• Require the CFPB to follow the appropriations process. This reform is allegedly meant to make sure money isn’t spent wastefully.
• Give greater power to federal bank regulators. This move would, according to supporters, keep the CFBP’s rules from “causing” a bank failure.

The reason these proposed changes have caused uproar from the media is that the financial crisis we’re still dealing with demonstrated a clear need for the CFBP; these changes could seriously limit its power to enact any significant change. And as a kicker, some sources note that the lawmakers behind these proposals are largely responding to money spent by the financial industry to undermine the CFPB’s effectiveness.

It’s graduation season and that means one thing for most college seniors: the real world starts. But if results from recent financial literacy polls show us anything it’s that most Americans (college graduates included) aren’t quite as well informed as they should be about matters of the wallet.

So for any grads out there, here are some important financial management strategies that can make life in the real world smoother.

• Face your student loans. Most grads today enter the working world with at least some debt from student loans (the average amount currently sits around $20,000). It’s important to understand that these loans must be repaid and cannot usually be discharged in bankruptcy. Your payment record of student loans will effect your credit score. Take time to review all paperwork associated with your loans, consider consolidation and be sure to contact your lender if you anticipate having difficulty making a payment.
• Start working. Even in a difficult economy, you can start your career on the right path. If companies aren’t hiring, offer your services as an unpaid intern so you can learn as much as possible, gain experience and possibly make yourself indispensible to a company (which could lead to a full-time job). All of these are long-term investments in your career. You might also want to turn a period of unemployment into one of self-employment by offering skills you have to those in need.
• Start saving. It is never too early to begin saving money. Emergencies can happen at any time, and having some money set aside can mean the difference between being okay and ending up in serious debt. As a new grad, you can save money by living at home, living with roommates, having funds automatically deducted from your paycheck and establishing a budget right away.
• Think long-term. It may seem too early to start saving for retirement, but it isn’t. Financial experts agree that the time to start thinking about retirement is when you land your first full-time job – after all, the earlier you start saving, the less you have to save per year to reach your financial goals.
• Be realistic about credit cards. Credit cards can be a great way to build your credit history, but they can also lead to tremendous debt for those who aren’t careful. Shop around for a credit card that suits your needs and make a habit of paying your balance in full each month.
• Think about what you want. Managing your life is no small task, but remember: the goal of developing a financial plan is to get to a place of financial stability where you’re free to pursue your dreams, whatever those may be. It’s a good idea to spend some time determining what specific things you want to have and/or do so you know how you need to be handling money to get them.

Anyone who has considered filing for personal bankruptcy as a way to eliminate debt should already understand the importance of budgeting. But even if you’ve never submitted a bankruptcy petition, there’s a chance you could benefit from brushing up on your budgeting skills.

So what more can possibly be said about budgets? Plenty, it seems. After all, millions of Americans are still overextended on credit cards, losing their homes to foreclosure and/or struggling to find enough work to sustain their families. Figuring out how to spend and save money is no small feat.

Find Your Budget Balance

Here are some tips to consider when you decide you’re ready to create and stick to a budget that will actually work.

• Simplify. Elizabeth Warren, head of the Consumer Financial Protection Bureau, has suggested a super-easy outline for personal budgets that consists of three tiers: needs, wants and savings. The “needs” category (which includes shelter, groceries, basic clothing, utilities, health expenses, transportation, etc.) should take up about 50 percent of a person’s income; the “wants” category (which includes things you don’t need to survive) should take up about 30 percent of income; the “savings” category (which includes paying down debt) should account for the other 20 percent.
• Personalize. Whether or not Warren’s method appeals to you is a matter of personal taste. If it doesn’t, spend some time browsing the web for other budget outlines – there are hundreds of them. Determining which one works for you is a matter of appraising your personality, spending habits and goals. But don’t be afraid to tweak whatever budget plan you choose: remember, this thing needs to work in your life.
• Rethink budgets. Rather than thinking of a budget as something that limits how much you spend, think if it as a roadmap for where you want your money to go. You should send some of it to your future self so you don’t have to work your whole life (we call this “saving”). Some of it you have to trade for necessities like water and housing. And the rest of it can be used to buy things and experiences that make you happy.
• Think long term. Some experts recommend making a budget based on your yearly needs to start and then breaking the numbers down for a month-by-month look. Why? This method takes into account infrequent expenses like taxes, holidays and vacations that might not show up in month-to-month plans.
• Think big. While you’ve got the big picture in mind, don’t forget to sweat the big stuff. While cutting out your daily latte might help you shave away at your expenses, planning ahead to get a good deal on a car or a house can help you save huge chunks of money.

Remember: balancing your budget is just one part of balancing your life. Think of managing your money as one step along the road to achieving overall calm and control in your world.

One of the most frustrating stumbling blocks for those of us working to eliminate debt or recover after a bankruptcy filing is when things break – that is, when we have to go out and buy something that just yesterday worked fine and dandy and didn’t cost any of our hard-earned money.

Luckily, small bumps in the road don’t have to ruin your budget or send you running to your emergency fund. Here are some tips I’ve learned for spending very little on essentials.

Buying Secondhand: When It Makes the Most Sense

Secondhand shopping is not a new strategy for saving money, but it’s more effective for some things than others. The following are some of the easiest (read: hours of your life won’t be wasted sorting through shelves) and most effective (read: you won’t have to go out and buy another one after the first breaks) things to buy used.

• Kitchen appliances: I bought a blender for two dollars a few years ago and have used it continuously without any glitches. It’s not fancy and it’s not shiny, but it blends a mean milkshake whenever I ask it to. And coffee makers? I’ve never been to the kitchen goods section of a secondhand store that didn’t have at least a dozen. This is good whether you need a new machine or just a replacement pot (yes, that glass can break easily).
• Kitchenware: While I wouldn’t buy baking sheets or Teflon pans secondhand because of health concerns, I love buying used dishes, cutlery and utensils. In gourmet kitchen supply stores, these things can cost serious cash, but go secondhand and you’ll pay pennies on the dollar. Bonus: outfitting your kitchen with the right tools might help you cook at home more (and thus save more money!).
• Kids’ and babies’ clothes: If you’ve got the time and stylistic inclinations to shop secondhand for yourself, too, I say go for it. But if you don’t, take advantage of the wealth of secondhand clothing for children and babies. You can see thrift shops as a source of primary attire or a way to supply your children with dress-up clothes, play clothes and anything they’ll outgrow quickly. The savings add up fast.
• If you must buy books (rather than borrow them from the library), always go used. In fact, browsing used bookstores doubles as free entertainment for book-lovers and may, dollar for dollar, be one of the cheapest thrills around.
• Accessories: In the era of Target, it’s all too easy to outfit yourself in the same (admittedly cute) stuff everyone else is wearing. Stretch your wings and check out consignment jewelry and accessories. Don’t be surprised if you start getting lots of compliments.