To say that state tax receipts are down is hardly news. Between unemployment driving down state income tax receipts, a laggard consumer market cutting sales tax, reduced driving pulling down gas taxes and businesses shutting their doors or moving elsewhere to drive down corporate tax receipts, the tax picture has never looked worse for the states. But what does that mean to you? The biggest thing is that states will either need to cut budgets or raise dollars, and often both.

There are three things that jump out at me that this means--here's how to protect yourself.

State debt may offer better rates. Cash-strapped states may look to borrow, and thus offer better bond rates for those interested in investing in a state government. Though there is a chance of default on this debt in the future, it is somewhat abrogated by the fact that states take in money every year thanks to taxes on whatever's left.

State taxes may go up. Thus, if you have the choice to take income in 2010 or 2011, you may want to stick to the devil you know rather than the devil you don't. Any state tax hike is likely to take effect not this year (being as this year's already a third over with, almost) but rather next year. Also consider where you may be able to take more deductions if you have a small business or itemize your annual tax returns. The more deductions, the less paid out.

City taxes, where applicable, may also go up. Counties and cities that depend on revenue sharing with the state will get a smaller chunk of the pie since the overall pie is smaller. So in places where there are city or county taxes, you may want to consider moving before the city or county in question gets the idea to jack up taxes. Even if you have to commute a little longer to get to your job, chances are the extra gas money won't be as high as jacked-up city taxes, county taxes, or even property taxes.

It's all about adding to your savings out here at Best Cash Cow, and when you can protect your current savings, that's just as good.

SmartyPig is getting ready to buck the trend of declining savings rates by announcing that it is raising its rate to 2.15% from 2.01% APY. As part of that increase though, it's creating a tiered rate system. Only the first $50,000 will receive the higher rate. The tiered system works like this:

*Effective May 19, 2010:

• Interest rate earned on balances $1 - $50,000 will earn 2.133% (2.15% APY)
• Interest rate earned on balances above $50,000 will earn 0.499% (0.50% APY)

So, if you plan on investing more than $50,000 SmartyPig is not the place. The 2.15% APY though is one of the top savings and money market rates according to the BestCashCow rate tables.

Here's what SmartyPig's CEO had to say in the press release announcing the rate increase:

"With credit card issuers expected to raise interest rates to 16 or 17 percent by the fall(3), we believe it is important now, more than ever, that consumers adopt responsible financial habits," said Bob Weinschenk, chief executive officer, SmartyPig. "Which is why we firmly believe in rewarding customers who want to save and spend smartly, and give them the opportunity to get ahead again and stay there."

Several Things to Know About SmartyPig

SmartyPig is not a typical savings account. The site works by creating goals that you can save for: a vacaction, college tution, a new television, etc. Then, when you are ready to withdraw the money, you can do so in one of three ways:

• You may put all of your savings plus interest on the flexible SmartyPig MasterCard® debit card
• Have it sent back to your bank
• Receive up to a 12% cash boost on your savings by placing it on a retail card like Amazon.com, Best Buy, Travelocity or Macy’s

So, if you're saving for a television or cloths at Macy's, the savings get an extra boost. If you just want to use it like a regular savings account, you can have the money sent back to your main bank when you are ready to widthdraw funds.

The second thing to know is that SmartyPig does not actually keep your money. They are not a bank. Instead, your funds are held by West Bank, an FDIC insured bank. There has been some debate on various sites about whether those individual accounts are FDIC insured. In the past I have spoken with West Bank about this issue and they assured me that each individual account was insured up to the maximum allowed by the FDIC.

The introduction of the Roth 401(k) added an excellent new retirement savings strategy for workers. It also added more confusion to the already-difficult retirement planning conundrum. So which is better: the Roth 401(k) or the Roth IRA?

Roth IRA contributions were first accepted in 1998. That year, $8.6 billion went into these retirement plans, with another $39 billion transferred from traditional IRAs to Roth IRAs. By 2001, IRS data showed that contributions to Roth IRAs had surpassed the amount going into traditional IRAs. Why the shift?

Money earned in a Roth IRA can be taken out in retirement tax-free. Contribution limits for Roth IRAs are generally the same as with traditional IRAs, with one major difference: as long as you keep earning money, you can contribute to a Roth, regardless of your age. In contract, the traditional IRA requires minimim withdraws at the age of 70 1/2.

Roth IRA Plan

Advantages: The earnings are tax-free. This is very appealing to young account holders who open a Roth early and let the money grow for decades, as well as individuals who expect to be in the same or possibly higher tax bracket when they retire. You can contribute at any age and can take money out on your timetable, not the IRS's age 70 1/2 withdrawal schedule required of Traditional IRAs.

Disadvantages: Contributions are not tax deductible. There is an earnings limit which restricts higher-income taxpayers from contributing or converting traditional IRA money to a Roth IRA.

Roth 401(k) Plan

These accounts combine the basics of 401(k)s with the tax-free aspect of Roth IRAs. Essentially, workers put money into Roth 401(k)s after payroll taxes are withheld, meaning the account doesn't offer an immediate tax benefit. But when the money is withdrawn, it is tax-free.

Advantages: Distributions are tax-free. Contributions, as with regular 401(k)s, are higher than for IRAs. Employer matching contributions increase your retirement savings. There are no adjusted gross income caps, so higher-income workers who may not be able to open a Roth IRA can contribute to a Roth 401(k). Also, you can leave the money in the account past age 70 1/2.

Disadvantages: These are not yet as available as regular 401(k) plans. Because money goes into this account after taxes are withheld, you get no immediate tax break.

Whether your 401(k) is a regular or Roth account, ultimate responsibility for your workplace retirement savings rests entirely on you. You generally must enroll in the account and then manage it, deciding which 401(k) offering best fits your personal financial situation.