(MONEY Magazine) – Some good advice about money is timeless: Save more. Spend less. Don't treat your retirement kitty like a stack of chips at a $5 blackjack table. Other great ideas need to be acted on right away, lest the potential advantage be lost. It's the latter kind of advice you'll find in the next seven pages: 33 great ideas that can make or save you money between now and the end of 2006. They cover topics from your home to your job, your saving to your spending, your family's well-being to your health. Most of these ideas are easy to execute, and quite a few are downright fun. You won't care, or need, to act on all of them, but read on and you should end up with a pretty good notion of what your money action plan is for the new year. So get started--2007 will be here before you know it.

Your Home

Bubbleproof your most important asset--and control your biggest debt

• Get Your Fix The rate on a 30-year fixed mortgage could top 6.7% before 2006 ends; it's now around 6.3%, compared with 5.9% on a 5/1 adjustable-rate loan. As long as the rate difference between the mortgages is less than 0.7 percentage points, it's worth paying a bit more for the safety of a fixed payment (on a $200,000 mortgage, that's $52 a month extra). Have a three- or five-year ARM that's about to come up for an adjustment? Rates are heading up. Don't wait to switch to a fixed loan.

• Don't Bet the Ranch It's increasingly a sucker's bet to buy more house than you can afford and assume that cheap financing and rising home equity will bail you out. Why? Housing affordability is the lowest it's been in 14 years. In California, for example, only 14% of people can purchase a median-priced home. "This is an unbelievably dangerous time to take risks in the housing market," says financial planner Harold Evensky of Coral Gables, Fla. (a hot market itself). "It's a great time to build up a good amount of equity in your home." So take a pass on the interest-only loan you'd need to finance a McMansion or that 2,000-square-foot addition to your current abode (what's the heating bill on that, anyway?) and settle into a place you can afford today.

• Flipping Is Out... Don't buy an investment property that you intend to flip. The inventory of unsold properties is increasing, as is the time between listing and closing. And if you already own an investment home, give some thought to selling now, unless you've decided you really want to be a landlord for the next several years.

• ...but Second Homes Are Still In If you already own a vacation place (and you can afford it), there's no reason to bail. The second-home market is expected to remain strong over the long run, thanks in large measure to the demand from retiring baby boomers. Looking to buy? Be patient. If the market for primary homes weakens short term, there's a good chance that the vacation market will too.

Beat the Heating Bill

Heating oil bills will rise as much as 33% this season; natural gas users could see a 50% hike.

For more energy-saving tips, visit eei.org/wiseuse.

SOURCE: Edison Energy Institute.

Your Portfolio

Don't guess whether the big risk is inflation or recession. Be ready for both.

WHAT SHOULD YOU WORRY ABOUT? The frying pan? The fire? Both? Today's aimless stock market is bad enough, but in 2006 you have some potential unpleasantness that could hit your portfolio from opposite directions. One dreaded scenario is years of higher inflation, perhaps augured by the recent spike in energy prices. The other specter is a recession--a shrinking economy brought on by too-high interest rates that dampen economic activity and pop the housing bubble.

So how do you prepare for inflation and recession? You start by understanding that neither you nor anyone else can predict with any certainty which hazard, if either, will come to pass. One of investors' biggest mistakes, says Dreyfus chief economist Richard Hoey, is responding to a plausible prediction of the future by investing as if that scenario were a sure thing. "You need a strategy that will have a low probability of giving you a disastrous outcome if you're wrong," says Hoey. Here's how to insulate yourself from shock, without missing a stock market rally if the economic clouds part.

• Do Some Bonding Certain yield-boosting investments in the bond market could turn ugly if conditions get unpleasant in 2006. High-yield debt (junk bonds) usually gets whacked in a recession owing to its increased risk of default. Long-term bonds, meanwhile, will see their value eaten away by inflation and rising rates. Adopt a safe all-weather bond strategy that starts with short- and intermediate-term debt. Add to that mix a 25% allocation to foreign debt, such as the MONEY 50's American Century International Bond fund (BEGBX), and about half that amount to Treasury Inflation-Protected Securities. You can buy TIPS at treasurydirect.gov. Fund investors can buy the Vanguard Inflation-Protected Securities fund (VIPSX), another selection from the MONEY 50.

• Easy on the Hard Stuff Hard assets, including real estate, oil and gold, are classic inflation hedges. But they've all run up in recent years, depleting their power as a value preserver. And if they dominate your portfolio, you'll get clobbered in a recession. So put no more than 10% of your portfolio in REIT funds, and no more than 10% in commodities and natural resources. By no means should you invest directly in commodities; start with the T. Rowe Price New Era fund (PRNEX) or the less energy-intensive Pimco CommodityRealReturn Strategy fund (PCRAX).

• Be Nimble with Cash Stay short with your cash savings for at least the first half of 2006. As the Federal Reserve continues to push up interest rates, short-term rates could pass 4.5%, up from just 2.25% in early 2005. Money-market funds, which react quickly to rate hikes, will keep pace with the rise. They'll also keep your cash accessible. So should rates stall or even drop next autumn, you can roll into a longer-term CD to lock in high yields, suggests Greg McBride of Bankrate.com.

Stocks for All Seasons

Some market segments do well in a period of high inflation; others hold up in a recession. You want some of both in 2006. Here are sectors that typically do well in these conditions, plus leading stocks in those groups.

• INFLATION

DOMINANT TECH They can maintain profits since customers have few alternatives. Cisco (CSCO)

FOOD Suppliers have flexibility to raise prices quickly. Sysco (SYY)

ENERGY Can these guys raise prices in a hurry? You already know the answer. ExxonMobil (XOM)

• RECESSION

CONSUMER STAPLES In hard times, people still do the laundry and brush their teeth. Procter & Gamble (PG)

UTILITIES Steady demand for power and steady dividend payouts buttress these stocks. Southern Co. (SO)

FOR FUND INVESTORS

LARGE-CAP GROWTH FUNDS such as Harbor Capital Appreciation (HCAIX)

DIVIDEND-FOCUSED VALUE FUNDS such as T. Rowe Price Equity Income (PRFDX)

Your Job

• Don't Ask for a Big Raise Increases will be modest in 2006. Ask for a bonus instead. "Companies are willing to reward performance through incentives and bonuses," says Steven Gross of HR consultant Mercer. Fifty-five percent use spot cash awards and signing bonuses.

• Get a Better Gig Recruiters say the fields below will be in high demand for 2006 and beyond. If you have relevant skills, get the training you need to make a switch. If you're already in one of these areas, you've got bargaining power.

HOT JOBS

RETIREMENT PLANNING Aging boomers need financial advisers and tax lawyers. HEALTH CARE Constant change means work for benefit-plan administrators and information technology specialists. AUDITING Increased scrutiny of corporate books requires more accountants.

NOT JOBS

TRADITIONAL MEDIA AND ADVERTISING The Internet's growth is a drain on old media. CALL CENTERS, DATA ENTRY AND MANUFACTURING These jobs are easily exportable.

• Get an M.B.A. on the IRS Historically, it's been difficult to deduct the cost of an M.B.A. from your taxes, but a 2005 ruling by the U.S. Tax Court improves your chances. You can write off the cost of your tuition, but only if the degree "improves and enhances" your ability to perform in the job you have. You don't have to stay at your current company to get the tax break, but you'll lose the deduction if you quit to go to school full time or you use the M.B.A. to change careers.

Your Health

• Don't Blow This Deadline! Sign up for Medicare's new prescription drug program by May 15. If you're eligible for the plan but don't sign up by then and if your current coverage is not at least as good as Medicare's basic plan (by now your insurer should have told you whether it was), you will pay a higher premium should you later choose to enroll. Don't worry if you don't love the plan you pick. Between Nov. 15 and Dec. 31, 2006, you'll be able to change plans without penalty. For more information, go to medicare.gov or call 800-MEDICARE.

• Feel Good About Your Work As companies battle rising health insurance costs, more of them will be adding "wellness" programs in 2006 in hopes of improving their employees' overall health. According to a recent survey by the Deloitte Center for Health Solutions and the ERISA Industry Committee, 62% of large employers now offer some type of wellness benefit. Nearly all the rest are thinking about it, so check into what your company offers.

MOST POPULAR WELLNESS BENEFITS

• Smoking-cessation classes • Health-risk assessments • Company gyms

PROBLEM More than 75% of employees don't take advantage of these goodies. SOLUTION Ask your company's HR office what you've got coming to you.

• Think Generic If you aren't already filling prescriptions with appropriate generic drugs, start. The cost of brand-name drugs grew at more than twice the rate of inflation from mid-2004 to mid-2005, compared with zero increase for generics, according to the AARP Public Policy Institute. "We expect the same pattern to continue in 2006," says AARP's John Rother. Co-payments for brand-name drugs (typically $20 to $30 per prescription) could easily be $5 higher this year, says benefits consultant Towers Perrin, while generic drug co-pays should remain steady at $10 to $15.

DISCOUNT DRUGS

Average co-payment for brand-name drugs in 2006 $30 For generics $12

SOURCE: Towers Perrin.

Your Family

Thumb your nose at ID thieves. Plus, more ways to protect your loved ones.

• Mask Your Identity Chances are better than ever that in 2006 you'll be able to place a security freeze on your credit report. That effectively stops prospective lenders from issuing credit to you--or, more important, to anyone pretending to be you. The financial services industry hates freeze laws, natch, but a dozen states have already passed them (see the table on the facing page). Others, such as New York, could join the Big Chill within months. To learn how to place a freeze in states where it's available, check out idtheftcenter.org/vg124.shtml.

• Jump on the Credit-Report Cycle All Americans are now entitled to free annual copies of the credit reports maintained on them by the big three credit bureaus. So there's no longer an excuse for not checking to see whether your report is accurate or contains the odd activity or strange addresses that could signal ID theft. If you're applying for a major loan, request all three of your reports at the same time. Otherwise, order one from a different bureau every four months to keep tabs on your credit without paying for a monitoring service. Go to annualcreditreport.com for an online report, or call 877-322-8228 to order a paper version.

• Change Your Life (Insurance) Today you can buy more insurance for less money than you could a decade ago, even though, let's face it, you're 10 years older. In 1995 a 30-year-old male could purchase a $500,000 20-year level-term (rates stay the same) policy for $520 a year. Today that same 40-year-old can buy another 20 years, beginning now, for $365 annually. For a 10-year policy, rates begin at $220. Start shopping at accuquote.com.

• Get Ready for a Big One This isn't a 2006 weather forecast, but if 2005 provided the country with one unhappy lesson, it's that you need to be prepared for natural and man-made disasters. Keep enough cash on hand to cover a few days' worth of food, lodging and gas, or keep a credit card with a zero balance set aside for such an emergency. To get a handle on which financial records you should have in a safe place, use the Emergency Financial First Aid Kit at operationhope.org. Alarmingly, half of Americans don't have an emergency fund for replacing income if a disaster keeps them from working. So stash money in a bank account or money-market fund to cover three to six months of living expenses.

• Ditch Your Long Distance About 80% of wireless phone users in a recent study said they were planning to dump their landlines by 2007. Not ready to cut the cord? You can still save a bundle by not paying your phone company for long-distance service you already have coming to you through your cell phone. Seventy-eight percent of all bought-and-paid-for cell-phone minutes go unused, according to a survey from TNS Telecoms.

• Don't Procrastinate--Consolidate If, like millions of college students, your child has taken out federal Stafford loans, investigate consolidating the debt by mid-2006 at the current rate of 4.75%. Unless Congress intervenes, those loans are slated to be fixed at 6.8% on July 1. If a graduating senior with the four-year maximum of $17,125 in Stafford loans takes no action, she'll have to pay $197 a month for 10 years to erase the debt. But if she consolidates early, says Gary Carpenter of the National Institute of Certified College Planners, she could stretch her payback from 10 years to 15 and pay only $133 a month, incurring minimal additional interest expense. You can find a loan-consolidation application on your lender's website.

Where ID Crooks Can't Go

By the end of 2006 at least 12 states will permit credit-report freezes, but some allow only ID theft victims to use them.

NOTE: [1] Also applies to victims of security breaches. SOURCES: U.S. Census Bureau 2004 Population Estimates; state public interest research groups.

Your Stuff

Where and when you'll get the best prices on the things you want this year

• Buy a Hybrid in the Winter... Pick up a hybrid gas-electric car and you'll be eligible for a tax credit of up to $3,400. But if you want the estimated $3,150 credit on a Prius--or any other car from Toyota or its Lexus unit--move fast. Because of byzantine rules linking credits to an automaker's overall hybrid sales, credits for Toyota hybrids will likely be halved at the end of September. The IRS has yet to clarify whether you must take delivery before any cutoff date to qualify for full credit, and some markets have long waits for a Prius. For estimated tax breaks on different vehicles, visit the website of the American Council for an Energy-Efficient Economy (aceee.org/transportation/taxcredits06.pdf).

• ...an SUV in the Spring... Need or want a big truck, regardless of gas prices? Hang on until the snow melts. GM's redesigned and dramatically improved full-size sport utility vehicles start hitting the market in January. But as good as the Chevy Tahoe, the Cadillac Escalade and other new models look to be, unless the market for big SUVs improves, GM will likely be forced to roll out $3,000 to $7,000 in discounts to sustain sales. Among the GM trucks' biggest selling points: A cylinder-shutdown system helps achieve best-in-class fuel economy, topping 20 mpg on the highway.

• ...and a TV in the Fall If you're in the market for a 40-something-inch flat-panel TV, pause your search until football season rolls around again. Plasma TVs dominate the flat-panel market, but 2006 will see increased competition from makers of liquid crystal display technology, which is brighter, lighter weight and costlier. Both LG.Philips and Samsung are starting production of larger LCDs at new factories in the spring, and Sharp is opening a new plant in the second half of the year. A 42-inch high-definition plasma set now selling for $2,800 should be well under $2,000 by fall, according to research firm iSuppli.

• How About a Game Player for That TV? Microsoft launched the first salvo in the 2006 video-game war early, releasing the Xbox 360 in November. A deluxe kit, including both a wireless controller and a hard drive for storing music and video, costs $400; a stripped-down system with a wired controller and no hard drive runs $300. That's hardly dirt cheap, but console prices tend to drop far below their debut price as soon as a competitor's machine hits store shelves. So if you want to save money, wait until fall. By that time, both Sony's PlayStation 3 and Nintendo's new player, code-named Revolution, will be on the market. Nintendo, the underdog in this fight, will likely undercut its rivals from the start--and throw in a slick Mario game to boot.

Pick Up a Phone...Cheap

Cellular-phone companies are rolling out new services and handsets with whiz-bang features such as video playback. What's cooler than that? Here's what: price cuts on excellent older phones from the same carriers.

Your Vacation

• Forget Flying for Free... With three of the seven biggest U.S. airlines entering 2006 under bankruptcy protection, major carriers are making it harder for frequent fliers to earn free seats. So use your miles for hotel stays or rental cars, which have few restrictions. Alternatively, spend miles with an airline's foreign partners, which may have less competition for awards.

• ...Except on the Discounters Major airlines like Delta are cutting back domestic routes, but carriers such as JetBlue and Southwest are rapidly expanding, fueling low-cost carriers' loyalty programs. You could land a free ticket more quickly than you would with a major carrier, especially if you travel short distances. Any eight round trips on Southwest, for example, will earn you a ninth. But miles expire on most low-cost airlines. And while AirTran and Spirit offer upgrades, not all discounters do.

• Join the Jet Set in Turin Hotel rooms are selling out fast in Turin, host of February's Winter Olympics. But you can still snag a decent room and cut your costs if you stay outside the city. Pay as little as $2,200 for a four-day, three-night stay 20 minutes south of Turin at a three-star hotel, with tickets to one event included. (You'll have to take public transportation to the city.) That's half the price of a comparable in-town package. As for the actual events, the cheap seats are gone and the most popular events, like women's figure skating, are sold out. But you still may be able to snap up tickets at the last minute, says SmarterTravel.com's Ed Perkins. Check for updates at torino2006.org/tickets or with Co-Sport, the only authorized seller of Olympic tickets and hotel packages in the U.S., at cosport.com or 877-457-4647.

A GOLD-MEDAL BARGAIN

Cost of a package deal if you stay in Turin $4,658

Cost of a package deal if you stay 20 minutes outside the city $2,200