In my opinion, my use of credit cards center around earning rewards and cash rebates. For others, it is earning airline miles. In other words, I want to get back as much from my use of credit cards (aside from the convenience and all the other goodies). But there are other ways to save money. One of the time tested ways to save money is using coupons. So I have asked Christina Brown, who is the author of Northern Cheapskate, a frugal living blog dedicated to freebies, coupons and money-saving ideas to give us an education about using coupons. Christina writes from the woods of northern Minnesota, where she clips coupons, pinches pennies, and chases three little boys as a stay-at-home mom. Consider subscribing to her blog for more money saving tips.

I love coupons. Each year I save more than $1,500 a year by clipping coupons. And I’m not even a hardcore coupon user!

You can learn how to save money with coupons, too.

First of all, you need to find sources for coupons. Buy the Sunday paper or get a friend or relative to give you their coupon inserts from the newspaper. Also be on the lookout for online coupons. Often the printable coupons from places like Coupons.com, SmartSource.com and RedPlum.com are even better than the ones in the Sunday inserts. If you don’t want to take the time to clip your own coupons, there are other other ways to get your hands on some savings.

Next, you need to start watching the sales circulars for your favorite stores. You want to learn what the rock bottom price is for the products you . Sometimes a grocery store will tell you something is a “Price Shocker!” but it really isn’t. Watch those unit prices, too. Sometimes ing in bulk is a better deal, but sometimes it’s not.

To start saving money, use the coupons you’ve clipped when the prices have reached their lowest, and stock up! Stores run promotions in 4-6 week cycles. You should be able to enough of the product on sale with a coupon to get you to the next great sale.

Watch for store coupons, too! Many grocery and discount department stores allow you to use a store coupon and a manufacturer coupon together. This allows you to save even more money money. Target is great source for this. They post Target store coupons right on their website and when you match them with great manufacturer coupons you often get things for free or nearly free.

Use the internet to help you plan your shopping trips. There are many blogs and websites that do all of the coupon match-ups for you, so you can save a lot of time and money. I especially like AFullCup.com and HotCouponWorld.com. Their forums are excellent and the shopping lists are extremely helpful.

Good couponers also abandon brand loyalty. Sometimes you can get really great deals on brand new products or other items that are on clearance. If you can get the products for free or next to free, it’s worth trying at least once. And if for some reason, you don’t have coupons, try the store brands. Many of them are just as good, if not better than name brand products.

When it comes to coupons, think small. Sometimes the best deals do come in small packages. If a coupon says $1 off one item, find the smallest size, and purchase it with the coupon. You will probably get the item for free or nearly free. (If the coupon doesn’t exclude trial sizes, check out that section of the store, too). For example, I got a 2 oz bottle of Purell hand sanitizer for free because I had a coupon that covered the entire cost of the bottle. I also got a 24 count bottle of Tylenol for less than a dollar.

Saving money with coupons does take time, but to me it is worth it! I clip coupons while the kids are watching television, and am able to use the money I save on things like paying down debt, family vacations, and boosting my emergency fund.  To me, coupons are like free money. All you need is about an hour a week.

The easiest way to save money has always been to not spend it.   That sounds like something that Yogi Berra might have said, yet it is still true.

Kiplinger’s 20 Ways To Waste Your Money

The financial gurus over at Kiplinger’s came up with this list of the least thrifty things that you can do.     It is a great list, in part, because they list paying credit card interest at #2.     Unfortunately, they do not truly explore all of the money you waste when you do not pay off your balance in full.   As they see it, “If you have a $1,000 balance on a card charging 18%, you blow $180 every year on interest. That’s money you could certainly put to better use elsewhere. Get in the habit of paying off your balance in full each month.”   In fact, the savings go far beyond that mere $180.    If you fail to pay a credit card bill in full, you not only pay interest on the balance, but you begin paying interest from day one on all purchases made since the statement closed.     Where you once had a grace period of up to 50 days or so, you know are getting hit with charges the instant the purchase is made.     Worse, not paying the last month’s bill in full allows them to start charging you interest on this month’s purchases that you already made!      The impending prohibition by the CARD act of “double cycle” billing will take some of the sting out of paying interest on your credit card, it will still be much worse of a deal than it looks, not that 18% interest looks that good anyways.   Who would take out a mortgage or car loan at 18%?

Once you calculate the real cost of the interest payments, you are still neglecting the reward card factor.   If you pay interest, you obviously need to find the card with the lowest interest rate.    If you know that you will never pay interest, you are free to find the card with the greatest reward.     2% on all purchases is now the gold standard for rewards, available from the Schwab bank card and others.   Higher cash back rewards are available from other cards on specific purchases.    To some, the frequent flier miles are a better deal.     Either way, you are forfeiting significant rewards by paying interest as a consequence of using the lowest interest card rather than the best reward card.

Credit Cards Can Work Against You

I came across this article in the New York Times about how subscriptions are being pushed harder and harder by companies out there.     The worst ones are when there is fine print that allows them to charge your credit card in perpetuity.    I try my hardest to avoid all recurring monthly charges.    I like to add them up to a year, and then figure out how much of my pre-tax dollars I am spending on anything I sign up for.   I can’t cancel my gas or my electricity bills, but I did end up canceling my cable TV once I realized that it was the equivalent of about $1,000 of my annual salary.   I realized that I was able to better spend my entertainment dollar elsewhere, and I cut the cable.    With that in mind, there are few good deals out there that charge your credit card every month, but lots of scams.

Speaking Of Scams

Here is a report about a credit card with a 79% interest rate!   Amazing stuff, but not when you consider the triple digit interest rates at pay day loan stores or furniture rental places.   Is this where the credit card industry is going?

I had the most bizarre telephone call to a credit card company.    I was explaining to their supervisor how their web site works.   Let me start from the beginning.

I opened up an a savings  account at Citibank some time ago.    They offer this neat feature where you can initially fund your account with a payment from your credit card.    I chose to fund it with a Citibank/American Airlines credit card.    Later, I received the bill, and went to their web site to pay it.     The site clearly listed both my Citibank credit card account, and my Citibank savings account.    My first attempt to schedule a transfer was unsuccessful.   I received a message saying that the feature was not available at that time.    A few days later, I was successful in scheduling a transfer from my Citibank Savings account to my Citibank credit card.    Or so I thought.

You’re Kidding Me

At work I received a phone call from Citibank’s credit card department asking me why I missed a payment.    I told them that I would have to research it and call them back.      When I checked the online account, there was no record of my transfer payment.

Step One, Contact Citi Banking

I call Citi banking, and try to explain the situation.   The representative authenticates me and is just about to tell me the problem, and the line goes dead mid-sentence.  No one bothers to call me back.

Step Two, Contact Citi Banking, Again

I authenticate again and wait.    Then I am asked by the same representative to give him all of the same information a second time.    Only then am I told the payment was canceled.     They can’t tell me how it was canceled, or who canceled it.    Furthermore, they can’t do anything to help me, other than to contact Citi credit cards.    I ask them to transfer me, and I am immediately disconnected, again.

Step Three, Call Citi Credit Cards

This time, I am not as patient.    I quickly realized that the customer service representative did not have the power to waive my interest and fees.    She kept asking me to make a payment first, and then they might consider waiving the late payment fee.    I am more interested in figuring out why my scheduled payment never happened.

Step Four, Speak With A Supervisor

This is where things get interesting.    I try to explain that the money for my payment to the Citi Credit card was in a Citibank Checking account, and that the transfer was inexplicably canceled.   I would like to be credited for the payment on time, which shouldn’t be a big deal, since Citi had the money the entire time.   The supervisor explains that Citi banking and Citi credit cards are supposedly not the same company!?     As she explains it, they are “sister companies”.      That was news to me, as I am able to see both the savings and credit card accounts by logging into a single screen.

Furthermore, she then claims that I can’t pay my credit card with a transfer from my savings.     This was especially surprising, considering that I was logged into my account at the time, and there was a button to make a transfer payment!  When I clicked the button, it gave me the option to make a payment from my savings account to my credit card account.    This time, instead of making a scheduled payment, I make an instant one.   It appears to go through, and I printed out the confirmation page just in case this one is inexplicably canceled as well.

The Citi cards supervisor is unable to communicate in any way with the Citi banking staff, to try to figure out what is going on.     In her view, what I tried to do was impossible, even though there is an option to do just that on their web site.   My only recourse, I am told, is to call the banking people directly, something I did not have the time or patience to do then.    Thankfully, she was able to waive the interest and late payment fees, and we hung up on a pleasant note.   My only concern now is that I am not charged more interest due to double cycle billing, and that my credit is not affected by a missed payment caused by their computer issues.

My Next Move

I would like to call the media relations people for each of the “sister companies” and get the official scoop.    Of course, the contact number is the same for both retail banking and credit cards. So much for the “Sister company” story.    My hunch is that they are just different departments of the same company that just don’t like to talk to each other, but I will provide you with their response as soon as  I get it.

Last week, I came home to find out that my house was burglarized during the day while I was at work.    Oddly, very little was taken.   A couple of cameras, some DVDs and a two credit cards.   The seemed to be looking for cash, but didn’t find any.

It was the theft of the credit cards along with their neglect of more valuable objects, that lead me to believe that he criminals were hardly master thieves.       In fact, I am rather glad that they took my credit cards.    Let me explain.    First, the credit cards that were laying on my desk, by definition, were the ones I don’t use on a regular basis.    Most of them were acquired in order to obtain a sign up bonus.   If I used the cards, they would have been with me, in my wallet.

Of course, taking my credit cards poses no financial risk to myself, as all credit card holders are protected from fraud.     Better yet, their use of my credit cards make it much more likely  that they will be caught.    Think about it, there are very few places that you use your credit card without either giving out your address, or being caught on a surveillance camera.     As it happens, the thieves used the credit card at a nearby gas station and a Wal Mart.      When I called to report the cards stolen, I inquired as to their recent use.    The banks were able to give me an exact time and place for their use, which I was able to supply to the police.    The police later informed me that the thieves were caught on camera, increasing the chances that they will be apprehended.

There are many psychological issues with coming to grips with the fact that people entered your house and went through your belongings.   One of the practical challenges of recovering from a burglary is inventorying what you have and what is missing.     Since most of the credit cards that are in my house are the ones that I got for their sign up bonuses, they are actually just the personal and business cards for my wife and I, from just two banks.     That made it easier to contact just two banks.   If I had lost my wallet, I would have probably had to make more calls.

The biggest problem in making the calls was that I was only able to tell the banks what cards I had, not knowing the numbers of the cards that were stolen.   Unfortunately,  something was lost in communication as one of the cards in my wallet was inadvertently canceled.     The next day, I had replacements overnighted to my house.    Frankly, I was not looking forward to the task of activating all of those cards.     I finally got around to it today.   There was, of course, no hurry as the cards were ones I don’t use.

What I don’t like about activating cards is that banks typically take the opportunity to try to market all sorts of stuff to you.   I think of this as “reverse telemarketing”.    Before the “do not call” list, telemarketers called you to try to sell you stuff that you don’t want.    Now, they just wait until you call them, and they don’t let  you hang up until they have made their pitch.    Fortunately, both banks I contacted had the good taste not telemarket to me.    I can on assume that the representatives are not prompted to do so when the card being activated is a replacement card from an  existing account that was sent due to the theft of the original.    Kudos to Citibank and Amex for their discretion.    Another good thing was that I was able to activate all cards from each bank with a single phone call, rather than re-authenticate myself over and over again.

In Conclusion

Credit cards can be a real pain some times.    Fortunately, it is experiences like this where they really shine.    Because I use credit cards as my primary method of payment, I rarely carry any cash, and never have any cash at home.    I don’t do this for security sake, but it turns out to be a very secure way to handle your finances.    In fact, I am glad that I had some credit cards laying around in plain sight.   If the burglars are ever caught, it will probably be in part because they were stupid enough to steal and use my credit cards.    Finally, if there is one thing that credit card companies seem to be very good at, it is supporting their card holders when their cards are stolen.    Everyone I talked to was friendly and sympathetic.    They gave me information that may help catch the burglar, and sent me new cards by overnight mail.     No, they were not perfect, canceling one of my cards that I told them was not stolen, but if the Denver Police were as efficient, I might even have my stuff back by now.