Money Blue Book

In an effort to encourage readers to learn to calculate net worth and track their personal financial progression, I’ve begun the process of posting my monthly net worth updates online for all to see and review. While taking the time and effort to record and analyze my investments and liabilities requires a measure of dedication, I think it’s an invaluable method to help me better plan and make adaptive financial decisions in my marathon journey to become financially independent.

My Current Net Worth and Financial Status Update Compared To Last Month

Saving My Small Home Business Income To Weather The Economic Recession

While October and November have been extremely difficult months in terms of the significant paper losses I’ve been seeing in my current stock and mutual fund investments, I continue to see a positive growth trend in my overall income cash flow (currently around $55,000-$60,000 a month). Despite the current economic situation, I continue to enjoy a steady stream of income from my legal practice day job and significant contributions from my side projects. While my small legal practice business has gyrated a bit in terms of leads and overall receivables, most pullbacks have been noticeably buttressed by steady increases in my alternative income streams, which includes profits generated by my online business blogs and my other real world developing ventures. However, as times get tougher, I anticipate monthly variable income drops in the coming months.

In this deteriorating economic climate amidst the ongoing credit crisis backdrop, it’s important to take prompt actions to preserve capital. That is why I have made a concerted effort to save as much money as I can to ensure I have enough emergency fund savings to weather any prolonged financial storm. While I currently remain gainfully self employed and have other immediate employment prospects in the way of legal temp jobs should my own legal practice or blogging business suddenly fall flat, I am very mindful of the fact that we are entering precariously unpredictable times. Even the once abundant spigot of 0% APR balance transfer credit card offers that used to be so popular among credit card arbitragers, that I used to rely so heavily upon as a secondary means of emergency fund support during periods of unemployment have slowed to a trickle. While my current savings rate is thankfully quite substantial, I remain perpetually dissatisfied, and remain determined to strive for ever increased levels of reasonable frugality and belt tightening to ensure I can endure the worst financial recession or depression scenario possible. I can’t predict what will happen months or years from now, but I can control my actions today and structure them so that I minimize my financial risks down the road.

My Stock Investments and Retirement Accounts Have Been Wiped Out

When I used to have a regular day job outside of the home, I had the luxury (if you can call it that) of not being able to track the market closely until I got home. Unfortunately (depending on how you look at it), I work primary from my home office now and have CNBC and Fox Business News on all day long as back ground noise. As a result, I am extremely in tune to the snowballing financial calamity and constant dire news coming out of Wall Street minute by minute. Every time I think the market surely must have hit a bottom, the bottom of some sector falls out and the entire stock market plummets yet another 5-10% as a whole. If we are not on the brink of a major financial market collapse at this point, we are surely close to it. With complete irrational fear gripping Wall Street and Main Street alike, as much as I hate to say it – I don’t think we’ve truly yet seen the worst – the worst is still yet to come. First it was the banking and insurance sector that felt the stabbing pain and now it’s the American auto industry that is on the verge of Chapter 11 bankruptcy. The huge recent plunges of the S&P 500 Index has by and large wiped out the bull market of 2002-2007 after the previous stock market wipe outs of 9-11 in 2001. Like a horrible nightmare of self fulfilling prophecies, it just keeps getting worse and worse, and the stock market bottom keeps getting spanked.

At this point, I’ve lost such a large percentage of my existing investment and retirement portfolio that I don’t even bother checking my account balances anymore. Due to my overly aggressive previous positions in foreign emerging market index funds, my stock portfolio is down more than 60% since their peaks in mid-2007. What was once a thriving stock portfolio worth more than $50,000 has been chopped to less than half. I debated whether to pull out of all my positions, but ultimately decided that I had ridden the stock price roller coaster too far down to bail out at this point. Thus, for the foreseeable future, I intend to ride this stock market coaster of doom as far down as need be. Having already lost more than half of my paper value, the prospect of losing the other half just don’t seem to hurt as much anymore. Besides, the sun will rise tomorrow, and tomorrow will arrive yet another day and another chance.

Cash Saving Accounts (Banks and CD’s)

Better days are ahead for the SS Money Blue Book Stock Portfolio, but this ship’s going to be pounded mercilessly until then. Thankfully (and I thank God for this everyday), my stock portfolio currently only comprises a comparatively small portion of my total combined assets, as I was able to wisely refrain from attempting to catch the falling knife of plummeting stock prices. Until there is more guidance on where this psycho market is headed, I intend to safely sit on the sidelines and continue stashing my cash savings in high interest savings accounts and certificate of deposits (CD) with the best online savings banks I can find. Sorry Warren Buffett, but for the moment, I guess I’m not fiscally strong enough to be greedy when others are fearful. Call it missing out on a juicy investment opportunity when prices are low or simply call it wise capital preservation if you will – in this unpredictable market, I intend to save my money in FDIC insured assets like money market savings accounts. While I might miss out on the potential of future gains by not taking a calculated risk today, at least I’ll sleep better at night knowing my money won’t suddenly evaporate overnight due to some irrational panic selling in the stock market. I will return to the market soon, but just not right now until there is more guidance.

Vehicle Asset Valuation and Dreams Of A New Car Purchase

Readers may notice that my 2004 Honda Accord EX-L’s vehicle asset value suddenly dropped more than 21% from last month. No, I didn’t get into a car accident nor did the vehicle end up in a lake. For the last few months I’ve been rather lazy in updating my car’s projected Kelly Blue Book dealer trade in value. While not an exact science, after running Kelly Blue Book’s online tool for used vehicle trade-in pricing and being extra conservative in valuation by plugging in my current mileage of 65,000 miles and condition of “good”, I came up with a reduced price that I felt accurately reflected its fair market value if I were to sell it today within a very short period of time.

As I currently have the financial means to purchase a new vehicle, I also briefly flirted with the wild idea of buying a new high performance luxury vehicle – contemplating a 2009 BMW M3 Sedan or a Mercedes Benz C63 AMG, both priced at around $55,000 to $60,000. But then I came out of my stupor and realized the irrationality of such a luxury purchase at this point in time. The enjoyment of owning such a high powered vehicle just didn’t seem to outweigh the tremendous financial loss of $60,000 worth of lost savings and investment potential. At least for now in my current stage in life, it would seem to be a very foolish financial splurge. Perhaps I ought to wait until I was married first and settled down with a family with a more sizable savings before indulging myself recklessly.

No Rush To Pay Off My Low Fixed Interest Rate Student Loans

Despite the relatively large amount of cash I’ve been able to save up in the last few years, I’m in no rush to pay off my student loans in full. That’s because currently my former subsidized federal student loans from law school remain nicely consolidated at a very low fixed annual interest rate of 2.25%. I consolidated several years ago back when interest rates were extremely low, and was able to further lower my rate over the years by satisfying all Sallie Mae good borrower perks for debtors who consistently made timely repayments. Because this fixed rate’s actually lower than what I could get if I stored the loan amount in a high interest savings account, I’ve decided to take my time paying off the loan principle. By keeping the loan balance in my interest earning bank account, the interest income generated (variable 3.50%-3.75% APY) is actually paying for the interest carrying cost of the loan (fixed 2.25%). Essentially, what I’m doing is engaging in a form of student loan arbitrage much the same way I used to make money from balance transfers.

Taking The First Few Baby Steps Towards Buying A New Home

While my luxury vehicle fantasy is just that – a fantasy, my desire to purchase a home for myself is very real. Currently, I’m renting a brand new one bedroom condominium in a suburb of Washington D.C. for $1,475 a month, but I feel it’s time I invested in a home to call my own. Of course, as home prices have plummeted and continue to drop, any major home purchase decisions I might make probably won’t happen until the second half of 2009 at the very earliest. I’m in no hurry to purchase a home and would be willing to wait an extra year until 2010 if the housing market conditions continue to stagnate. While potential home buyers such as myself certainly have the clout and means to price gouge home sellers mercilessly and demand unreasonable concessions to our heart’s content at this point, I think home prices still have many more months or years of continuous depreciation to go before they reach true fair market value. As evil or heartless as it may sound, when home values finally stop dropping in about 12 months or so, I’ll be there waiting, amidst the excess housing inventory, to eagerly select my home of choice and take it off the hands of some former owner who has no choice but to sell it at a desperate discount. Like it or not, it’s just efficient capitalism at work.

While I’m heavily leaning towards the purchase of a detached single family home, I’m not adverse to going with a high rise condominium with a view. As a relative newcomer to the realm of home buying, my preliminary research currently consists of watching home buying TV shows and occasionally browsing online real estate listing websites like Yahoo Real Estate, Zillow, and Trulia. I don’t even have a real estate agent yet as I’m still in the early preliminary research and scouting phase of home buying, primarily still working on maintaining my FICO credit score to improve my chances of getting an excellent home mortgage loan when the time arrives. I will talk about my search for a house in future posts.

Updated List Of The Best Secured and Unsecured Bad Credit Cards For Credit Improvement

Credit card usage is a fact of life whether you agree with its pervasiveness and all around commercial necessity or not. What started out as a way for consumers to make payments quickly and efficiently without the need to carry around cash bills and coins has morphed into a mish mash variety of credit card rewards, airline credit card miles, and balance transfer offers. Today, credit cards are used and needed for everything from airline ticket and hotel room reservations to car rental bookings. Credit card numbers are also necessary for frequent online shoppers as traditional bank accounts and debit cards don’t offer the same high degree of fraud protection that credit card issuers do. Owning at least one credit card and paying back the balance on a regular basis is also one of the easiest and most established ways to build up a credit score history, and secure your future ability to get approved for home mortgages and car loans.

Even those who are generally opposed to the use of credit cards and revolving debt on principle may find it difficult at times to survive without one. During tough economic times, independent minded people such as myself have used credit cards as emergency fund money to weather momentary periods of unemployment instead of relying on family handouts or resorting to desperate measures like high interest payday loans.

Of course, tapping into the myriad of credit card programs available in the marketplace requires that you be credit worthy and reliable as a borrower, as reflected by your existing FICO credit score, the 3 digit numerical expression most commonly used by credit card issuers and loan officers to evaluate your ability to pay back debt based on past payment history. Those with high FICO credit scores naturally have the inside fast track to the best credit card offers featuring the lowest interest rates with most lucrative cash back reward tantalizers, but even those with poor credit scores or a damaged credit history still have viable options at their disposal. While credit card issuers are significantly more leery about lending credit to those with troubled pasts, it’s not impossible for those with no credit history or those with bad credit to obtain a credit card, although it will probably cost you. Those with poor credit must recognize that the bad credit or subprime credit cards will almost certainly demand higher interest rates, annual fees, and account maintenance charges than regular consumer or business credit cards. However, the stiffer terms are necessary to compensate credit card issuers for the extra credit risk they must take on to lend money to applicants with less than perfect credit.

Secured and Prepaid Credit Cards Provide Credit Options To Those Denied For Regular No Fee, Low Interest, Unsecured Credit Cards

Those with out of control shopping obsessions, with damaged credit histories and no self control when it comes to credit card use, should stay away from applying for credit cards altogether, bad credit cards or otherwise. However, those with limited or no credit history, or those with a less than stellar past when it comes to debt, who wish to improve their credit scores may want to consider credit card programs set up to help cardholders rebuild, repair, and improve their credit for the better. Because people who have never used credit or those who need to repair a poor credit history may not qualify for regular card terms, applying for either a high interest unsecured credit card, a deposit-secured credit card, or even a prepaid credit card may be the only way to establish or re-establish credit. These so-called bad credit credit cards in all their variety provide cardholders the ability to maintain their access to the day to day consumerism benefits of credit card usage and take steps towards salvaging their financial lives and credit histories. By making regular monthly payments towards their secured or prepaid credit cards, their FICO credit scores are likely to see improvements, allowing them the opportunity in a few months time to possibly qualify for a regular consumer card with substantially more favorable terms.

Of course at the same time, it’s important to bear in mind that if you fail to meet your bad credit credit card’s monthly payment obligations, you will likely be hit with stiffer fees and interest payment demands resulting in further deterioration of your credit rating. But those with poor or damaged credit who are genuinely planning on walking the straight and narrow path to improving their credit status will benefit from the poor credit credit card programs listed below. Even in this current tough economic climate amidst the credit crisis, there are still ways to approach debt usage responsibly.

The Best Unsecured Credit Cards For People With Average Or Slightly Bad Credit In Need Of Improvement (Low Fees, But Require Average Credit):

If your credit is merely average or could use some improvement, then applying for an unsecured credit card designed for those with average credit may be your best option. These cards still provide a reasonable array of reward offers without the hassle of overly high annual fees or extraneous charges. The only downside is that compared to their excellent or good credit card comparables, the credit cards for those with average credit tend to have lower and more modest credit limits ($1,000-$3,000).

1. Capital One Classic Platinum Mastercard – Get an introductory 0% APR interest rate for purchases until June 2009, and a relatively low rate thereafter. Both the Visa and Mastercard versions only require average credit for approval. There is an annual fee of $19.
2. Capital One Platinum Master Card – Enjoy a promotional 0% interest rate offer for all card purchases until June 2009, and a very low rate thereafter. Only average credit is needed for approval. There is an annual fee of $39.
3. Capital One Platinum Max (SM) Credit Card – Average credit applicants will receive a competitive fixed interest rate for 3 years. The annual fee is $19.
4. Capital One Standard Platinum Credit Card – Get an introductory 0% rate on all purchases until June 2009. The best part – there is no annual fee for this particular Capital One credit card offer.
5. Capital One No Hassle Cash Rewards – One of the few reward credit cards that only require average credit to apply. Earn 1% cashback on all purchases and an extra 25% annual bonus on the cash you earn during the year. Get a 0% purchase rate until June 2009. Annual fee is $29.
6. Capital One No Hassle Point Rewards – Even with average credit, you can still qualify for this reward card, and earn 5 reward points per dollar spent at gas stations, grocery stores, and drug stores. The annual fee is $29.

The Best Unsecured Credit Cards For People With Poor Or Bad Credit (No Deposit Required, But Need To Pay Attention To Fees):

Those with a troubled credit history or those with a bad track record of timely credit card payments may have to resort to higher annual fee unsecured card options. Credit card issuers that cater to the bad credit or subprime market are willing to extend you credit, but will undoubtedly demand more restrictive terms and conditions in exchange for the higher risk. While the unsecured cards listed below do not demand a potentially hefty upfront deposit, many do require higher maintenance charges. Of course, despite the higher fees, the very purpose of applying for bad credit credit cards is to help you improve your credit usage history so that one day you can upgrade to a more traditional card program in 12 months or so.

1. Orchard Bank MasterCard – This card is issued by HSBC and the application process features a custom Orchard Bank subprime card finder for those with bad credit in need of assistance in rebuilding their credit. The credit cards available include those with and without fees, and vary in terms of account processing charges. Please carefully read the fine print regarding the card programs available before applying.
2. Continental Finance Gold MasterCard - With this First Bank of Delaware credit card offer, those with poor credit histories can still get a second chance at a low interest unsecured credit card. Please read the terms and conditions carefully regarding account fees. While there are upfront charges, timely payments on your part will result in automatic credit limit increases over time.
3. Tribute Gold Mastercard – This card was designed for those with low credit scores and bad credit in mind as it periodically reports to the major credit bureaus to help you rebuild your history. Please read the terms carefully regarding the various bad credit credit cards available for applicants.
4. Continental Finance Mastercard – This unsecured bad credit card provides semi annual credit limit increases with monthly reporting to the credit agencies. Despite the upfront charges and fees, the monthly credit bureau reporting feature should be able to help cardholders rebuild their credit in time. As always, please read the terms carefully before applying.
5. Horizon Gold Credit Card – This unsecured credit card offer guarantees a $500 credit limit for those already with an active debit or credit card established in their name. Designed for those with poor credit, there is no credit check for card approval. There is automatic enrollment into a free trial of the ConsumerDirect identity protection program, but you can easily cancel within 5 days for free with no obligation. Please read the fine print carefully before making your decision to proceed.

The Best Secured Credit Cards For People With Very Bad Or Damaged Credit (Security Deposit Needed):

While there is a growing trend away from secured cards and towards unsecured cards with lower credit limits and higher interest rates and fees, secured credit cards still remain a viable option for those with nowhere else to turn for credit. Unlike an unsecured card, a secured credit card requires an upfront cash collateral deposit that becomes the credit limit for your account (for example if you deposit $500, your credit limit is $500). While the deposit is held by the card issuer for security, the deposit generally earns interest and is refundable once the cardholder no longer wants to access the secured credit line. Of course, because all secured credit cards charge an annual fee, it’s important to shop around and compare.

1. Bank of America Secured Visa Card – Provided by Bank of America, an established name in the credit card business, this secured credit card offer from BoA allows you to set your own credit limit depending on your deposit amount. The annual fee is $29 but with timely payments, this card can be a stepping stone for you to rebuild or reestablish your credit.
2. New Millennium Bank Secured Platinum Visa/Mastercard – Your secured credit limit will be equal to the balance in your interest bearing collateral savings account with New Millennium Bank. Minimum deposit is $300 and the maximum deposit is $5,000 per card. Your credit history will not be checked and you are guaranteed to be approved for this secured credit card offer.
3. New Millennium Bank Secured Black Diamond Visa/Mastercard – All of the New Millenium Bank secured credit card offers on this page offer the same terms regarding secured credit limits, fees, and charges. As always, please thoroughly read the credit card terms and conditions in the tiny print before applying.
4. New Millennium Bank Secured Gold Visa/Mastercard – Like the other NMB secured credit cards, the Gold Visa and Mastercards are meant for those with very bad or damaged credit who are unable to get approved for a credit card elsewhere. While there are upfront fees and regular account charges, steady on time payments will help you repair your credit history and help you reach your goal of ultimately upgrading to a regular card with substantially lower interest rates and better terms.
5. Applied Bank Secured Visa Credit Card – Get a low fixed rate with this secured credit card for poor credit history applicants. As with all secured credit cards, your credit limit is determined by your refundable security deposit. Remember to read the terms carefully regarding fees and processing charges.
6. Applied Bank Secured Visa Gold Card – The Gold card is basically the same as the regular Applied Bank secured credit card, with the same terms and conditions regarding fees and charges.

I’m a credit card arbitrage seeker, which means I enjoy looking for creative ways to make an extra buck by legally exploiting the existence of attractive credit card rewards and 0% APR credit card offers in the marketplace. One of the ways I used to make some extra money on the side was by applying for introductory 0% balance transfer credit card offers and depositing the interest free funds into high yield savings accounts to earn some passive interest income. While the most lucrative 12 month, no balance transfer fee promotions have dwindled as a result of the ongoing economic slump and worsening credit crisis, there are still creative ways available for savvy credit card arbitragers to profit from.

As with all credit card arbitrage type activity, the decision to partake or not requires that you weigh the potential payoff against the risks and effort involved. While some people may shrug off such activity as a waste of time and not worth the potential rewards, others see it as a relatively effortless way to earn some free credit card rebates that they’d otherwise not have. I tend to adopt the latter viewpoint, regarding credit card arbitrage and interest rate pursuits as integral facets of my financially frugal lifestyle. Personally, I don’t mind taking advantage of effortless free money opportunities as they present themselves, so long as the application or management process is not too onerous or prohibitive.

Of course, there will always be naysayers who cite such activity as a complete boring waste of time. But frankly, if $100 or $200 worth of rewards is small pocket change to you, I supposed it begs the question as to why you are even reading this personal finance blog to begin with when you ought to be sitting on some tropical beach resort with a martini in your hand and tended to by bikini clad beauties (or the male equivalents if that’s your thing).

Open Your New Bank Deposit Account With A Reward Credit Card To Earn Free Credit Card Rewards, Or Use A 0% Purchase Card To Get An Interest Free Credit Card Loan

While certainly not as lucrative or easy to fully manipulate on a massive scale as balance transfer credit card arbitrage, one relatively new way to take advantage of arbitrage rewards is to use a reward credit card to open and fund a new checking or savings account to earn free cash back, reward points, or airline miles. When you open a new checking or savings account pursuant to some promotional bank offer and have to transfer in money for the first time, certain banks permit you to initially fund the account using a credit card. Oftentimes, the card transaction goes down as a credit card purchase, allowing the cardholder to earn free instant rewards, rebates, or whatever purchase incentives the credit card offered. For those interested in earning credit card arbitrage income through the use of interest free credit card loans, funding the new bank account with 0% credit cards that offer introductory zero percent rates on all new purchases is another interesting option to consider in lieu of credit card rewards.

Before funding a new bank account with a credit card, here are a few very important factors to consider:

1. The funding limits imposed by the bank where the new checking or savings account is being opened at – some banks limit the amount of the initial deposit that you can charge onto a credit card. The credit card funding limit can range anywhere from $1,000 to an unlimited amount, capped only by your credit card’s maximum spending limit.
2. Whether the bank will treat your reward credit card funding transaction as a purchase (preferable) or as a cash advance (deal breaker). This factor is critical because you will only be able to earn credit card rewards if the initial fund transfer’s treated as a purchase. If the transaction’s recorded as a cash advance, not only will you be forced to pay the high APR rate for cash advances immediately, you will earn no credit card spending rewards in the process (which defeats the whole purpose of credit card arbitrage, which is to get more back than you put in).
3. The third factor to pay attention to is whether there are any credit card issuer restrictions (Visa, Mastercard, Discover, or American Express). While some banks impose no card issuer restrictions when it comes to new checking or savings account funding, others limit the permissible cards to only just Visa or Mastercard.

Finding a bank that permits newly opened checking and savings accounts to be funded with a credit card is relatively easy. Making certain that the credit card transaction will be registered as a purchase, rather than a cash advance transaction will require a bit more digging and conversing with customer service support on your part. While the majority of funding requests via a credit card go down as purchases, a quick browse through various online forums reveals a bit of disagreement among arbitrage seekers on how the different credit card issuers are actually treating such transactions.

Ultimately, how a particular credit card transaction is treated is up to the credit card issuer and not the merchant. Thus, the bank you are opening the new checking or savings account with has little say over how the funding transaction will be treated, whether it be recorded as a purchase or a cash advance. Because of this slight ambiguity, it’s probably safer to fund newly opened bank accounts with the merchant’s own brand of credit cards. Thus for example, if you are opening up a new Citibank checking or savings account, to be on the safe side, you may be better off funding your new account with a Citi credit card as they are less likely to pull a fast one and record the transaction as a cash advance than another credit card merchant like JP Morgan Chase or Bank of America. Likewise, if you are opening a Bank of America account, you should stick with using a Bank of America credit card to fund it. This is just a precautionary measure. Of course, you can always call the bank and credit card issuer directly to confirm how the initial bank account funding will be treated.

List Of Banks That Allow New Accounts To Be Funded Using Reward Credit Cards:

1) Citibank (view Citibank offers) – Citibank does not permit new bank accounts to be funded with Discover or American Express – you’ll have to use either a Visa or Master Card. On the plus side (and this is a very tremendous plus), Citibank does not appear to impose a maximum deposit limit on the amount you can charge onto your Mastercard or Visa credit card to open your new Citibank account. Theoretically, if your reward credit card offered 1% cash back with a high spending limit of $100,000, you could pocket an instant $1,000 worth of rebates immediately – theoretically of course. Of course, you’d want to pay off the whopping balance immediately by using the new $100,000 bank balance lest you face the prospect of a $100,000 credit card bill.

2) Bank of America (view Bank of America offers) – Within the last year, I opened a new Bank of America online checking account and successfully transferred in funds using a credit card. The card I used was actually a Chase credit card, but the transaction went through without a hiccup and was duly recorded as a reward earning purchase. While there is no limitation on the type of card that may be used to fund a new BoA account, the big downside is that Bank of America limits credit card deposit requests to a measly $1,000.

3) JP Morgan Chase – Chase bank also permits applicants to fund their new Chase checking or savings accounts with a credit card. Like Bank of America, they impose a deposit transfer limit, currently capped at $2,000. It’s not a whole lot, but if you’re going to open a Chase bank account anyway, might as well use a credit card to fund it and put some free credit card rewards in your pocket in the process.

Updated List Of The Best Christmas Credit Card Offers With Shopping Rewards and 0% APR Deals Below

Well it’s almost that time of the year again. No, not tax season – I’m talking about Christmas! For many Christians, Christmas is first and foremost a deeply religious holiday tradition that celebrates the birth of Jesus Christ. For the vast majority of folks though, the Christmas holiday season is all about shopping, buying gifts, and exchanging presents. The incredible compulsion to shop till you drop is so potent and all pervasive because the holiday starts so early and ends so late. Currently, the winter shopping season starts on Black Friday, the day after Thanksgiving when retail stores unleash their tidal wave of heavily discounted sales and free giveaways to jump start the holiday shopping race. Black Friday is quickly followed by Cyber Monday, when online shoppers take to the Internet airwaves after their Black Friday shopping binges to seek out the best online shopping deals and offers. Helped along by the shopping demand of other winter holidays like Hanukkah, the cycle of Christmas bargains and shopping deals doesn’t let up until well into the new year. Even then, hardcore shoppers still continue to raid the retail outlets and department stores for leftover holiday closeout sales and bargains.

Overwhelmed by the sheer number of retail store sales, promotional discounts, and limited time offers during the Christmas shopping season, it’s no wonder the amount of money spent on Christmas presents for many far exceeds the seasonal spending rates of other holidays during the rest of the year. Whether it’s the strong social pressure to buy more and more expensive gifts for friends and family, or whether it’s the competitive aspect of obtaining that perfect gift for your child (talking Elmo, Nintendo Wii, or Playstation video game system for example), we all seem to succumb to the inevitable Christmas shopping craze in one way or another.

Take me for example. I’m ordinarily a frugal shopper throughout the year, preferring to stay conservative and disciplined in my purchase habits. However, even I tend to let go a little bit during the Christmas months. That’s why as much as I enjoy the Christmas holiday festivities along with the cheerful sights and sounds, I often secretly dread this time of the year. Despite my better judgment, I know my frugal wits are likely to be laid to waste when all is said and done due to societal gift exchanging pressures. However, it’s important not to get too carried away with our shopping exuberance, lest we risk falling into a serious financial trap when the bills come in. Like an alcoholic hang over, the actual party and festivities may be quite enjoyable, but the post game reality may be too difficult to handle if you’re not smart with your wallet and spending decisions. That’s why it’s more important than ever to hold onto your financial senses and not abandon your frugal, deal hunting ways. During this time of year, online cash back deals, shopping coupon codes, and all sorts of discounts and promos abound – and it’s important to seek them out.

Christmas Shoppers Maximize Their Money With Cash Back Rewards and 0% Credit Card Offers

Like it or not, it’s an undeniable trend that more and more consumers are utilizing the convenience and shopping incentive perks of credit cards to make their Christmas purchases. Frankly, it’s not hard to see why. Credit cards offer a higher degree of ease and convenience compared to cash.  Because of online credit card tracking, it’s much easier to budget, analyze, and control your spending during the holiday season when all of your purchases are charged to your credit card. Due to the extensive fraud and unauthorized purchase protections offered by major credit card issuers, credit card purchases also tend to enjoy greater security oversight and more liberal return policies than ordinary cash purchases.

However, probably the number one reason why holiday shoppers utilize credit cards to do their Christmas shopping is to earn cash back credit card rewards and to take advantage of attractive 0% APR deals that allow them to make interest free credit card purchases for an introductory period of time. While those who struggle with credit card debt ought to stick with cash spending, those who have a good track record of responsible credit card use have the potential to save a sizable amount of money through credit card spending rewards, and enjoy a degree of financial flexibility with interest free shopping. Remember, unlike the use of balance transfers, you must actually charge purchases to your reward credit card to earn incentive rewards, and you must use it to make purchases to take advantage of any introductory 0% APR rates. Never use your credit card to request cash advances. Cash advances are almost never included in any introductory rate promotions so avoid using them.

List Of The Best Credit Card Reward Offers and 0% APR Deals For Christmas Holiday Shopping

Cash Back Reward Credit Card Offers – Whether you opt for cash back cards or credit card point rewards redeemable for gift cards, cash, and airline travel, both offer cardholders the competitive opportunity to spend and save money at the same time. Reward credit cards that offer point rewards for qualified purchases tend to offer a higher reward rate than straight cash back cards, however they often require a bit more micro managing of reward redemptions. For those of you who need to do your shopping now, you may want to take advantage of the $100-$200 gift card promotions offered by a select number of credit card issuers for new applicants – check out my compiled list of credit card sign up bonuses.

In terms of credit card reward earning potential, bear in mind that most credit cards have programs geared towards certain types of purchases (such as grocery, gas, or restaurants) with higher reward percentages for purchase made with those merchants. However, because most purchases via the Internet and or made in malls and department stores do not usually qualify for one of these special higher rebate categories, they generally must settle for the default reward rate – generally around 1%.

Here is my list of the best Christmas shopping reward credit cards (I’ve bolded the percentage rate you will most likely earn for purchases made at online stores and at most brick and mortar department stores and malls):

1. Blue Cash® From American Express – Get up to 5% cash back for everyday purchases like groceries and gas, and up to 1.5% for everything else when you exceed $6,500 worth of usage. Prior to that you’ll earn 1% cashback.
2. Starwood Preferred® Guest American Express Card – Get 1 point for every $1 spent, redeemable for versatile hotel and airline travel rewards. Potential to earn up to a potential 1.25% back with bonuses.
3. Discover More Card – Get 5% cash back bonuses in purchase categories like department stores, travel, home improvement, gas, groceries, and restaurants, 5% to 20% cash back at retailers through Discover’s online shopping site, and 1% unlimited rewards for everything else. Earn a $50 bonus when you make $500 in purchases within 3 months, and with Discover’s special Christmas promotion, you can get $20 back for every $200 that you spend at participating mall locations.
4. Chase Freedom(SM) – Get 3% bonus cash back on gas, groceries, and fast food purchases for the first 6 months. Earn 1% cash back on everything else with unlimited rewards, no spending cap, no restrictions, and no expiration date.
5. HSBC Weekend Card – Earn 2% cash back rewards on everything you buy on Saturday and Sunday. During the rest of the week, you get 1% cash back for everything, with unlimited reward earning potential.
6. HSBC Platinum Mastercard Cash Back Rewards - Earn up to a potential of 2% cash back with a limit of $400 worth of rewards, or 1% unlimited cashback on all purchases depending on qualification level.
7. Capital One® No Hassle Cash(SM) Rewards Card – Get 2% cash back on purchases at gas stations and major grocery and drug stores, and 1% cash back on all other purchases, with no earning limit or expiration.
8. Fidelity Investment Rewards Visa Signature Card – Enjoy a full 1.5% back on all purchases with no merchant restrictions. Points can be redeemed for cash and deposited into your Fidelity brokerage account.

Credit Cards That Offer 0% APR Rates For Interest Free Purchases (Ideal For Christmas Shopping)

1. American Express Blue – 0% APR for purchases (up to 12 months)
2. American Express Blue Cash® – 0% APR for purchases (up to 12 months)
3. American Express Blue Sky® – 0% APR for purchases (up to 12 months)
4. American Express Clear Card – 0% APR for purchases (12 months)
5. Citi Platinum Select Card – 0% APR for purchases and balance transfers (both up to 12 months)
6. Discover More Card – 0% APR for purchases (6 months) and balance transfers (12 months)
7. Discover More Card – Clear – 0% APR for purchases (6 months) and balance transfers (12 months)
   
8. Discover Open Road Card – 0% APR for purchases (6 months) and balance transfers (12 months)
9. Capital One Platinum Card – 0% for purchases and balance transfers (Up until January 2010)
10. Capital One No Hassle Cash Rewards Card – 0% for purchases (until January 2010)
11. Chase Flexible Rewards Platinum Visa – 0% for purchases and balance transfers (both 12 months)
12. Chase Perfect Card – 0% APR for purchases and balance transfers (both 6 months)
13. Chase Platinum Visa Card – 0% APR for purchases and balance transfers (both 12 months)
14. Citi Business Card - 0% APR for purchases (12 months)
15. Citi Business Card With ThankYou Network – 0% APR rate for all purchases (12 months).  Extra bonus offer of 10,000 ThankYou® Points after $250 in purchases, redeemable for a $100 gift card.
16. HSBC Weekend Card -  0% promo rate for purchases and balance transfers (both 12 months)
17. HSBC Platinum Mastercard Cash Back Rewards - 0% interest rate for purchases and balance transfers (both 12 months)