Chu's / Flickr

Reader Teresa cried out for help on our Facebook page and then emailed me her question about a missing discounted gift card. What would you do if you were in her position? Leave your suggestions in the comments.

Sorry can’t recall which freebie site I ordered a Barnes & Noble gift card from on sale @Christmas.  Charged my Visa.

I talked to a man & my order had not been completed & was then on the way I thought. My sister in AZ has never rec’d it though. Ideas?

Thx. Teresa

Is she cleaning or raiding the pantry? hfb / Flickr

I share five must read blog posts about saving money every Friday.

Pantry clean-up – Learn how to organize your pantry and save cash. (Wisebread)

Money problems – Find out how the national debt could hurt your wallet. (MainStreet)

Saving for retirement – Five minute guide to your 401k. (Fabulous & Frugal)

Paying off debt – Five tricks to paying off your holiday debt. (Time Moneyland)

Prepaid credit card – Is the financial guru Suze Orman’s “Approved Card” worth it? (20 and Engaged)

This post is copyrighted by BargainBabe.com. Any other site posting this content is violating the DMCA.

bomb_tea / Flickr

I share five must read blog posts about saving money every Friday.

Inexpensive recipes – Try any of these 25 cheap and tasty frozen broccoli recipes for an easy dinner. (Wisebread)

Student prices – Save money by using student discounts to purchase items. Thanks, Tina! (Bankrate)

Twitter helps – Check out the best Twitter feeds to get credit card tips.  (Main Street)

Cold weather – Get your home ready with tips to winterizing your home. (Money Crashers)

Holiday shopping – Find out what credit cards are the best for holiday shopping. (CNN Money)

naomi ibuki/Flickr

A large man carrying three stuffed red sacks passed me in Toys R Us recently. The manager and I exchanged looks. Huh?

“Having fun playing Santa?” she called after the man.

He pushed on, disappearing between two doors at the back of the store.

“Is that…?” I quizzed.

“Those are our layaway purchases,” she said.

“Ohhh. How is that program going this year?”

“It’s the first time we’ve done it store wide, except lotions and some small items, and it’s really keeping us busy.”

I was stunned. Layaway popular? Many stores are promoting their layaway programs, but I didn’t realize consumers were responding in such great numbers. As Yazmin noted in an earlier post, “It would be less expensive to use a credit card and pay it off entirely when your bill arrives.” If you don’t have a credit card, however, and lack restraint or need motivation, layaway may work for you.

Just keep in mind most programs charge a fee for the privilege of buying the item through layaway. And some programs lock you into that day’s price so if a sale or coupon comes up, nothing you can do about it.

Are you using or planning to use layaway this holiday season? I am not!

Chris Bartow / Flickr

In search of a good credit card? Here are the best rewards credit card.  (Kiplinger)

Missed Obama’s address? Find highlights of the main ways the Obama job plan may affect you if passed. (Fabulous and Frugal)

The American Dream is no longer about homeownership, but about retiring comfortably. (Time Moneyland)

What’s on TV? Check out this guide to frugal reality TV that can help you save money. (Wisebread)

If you like faux fur? This may change after you learn the hidden cost of clothes. (ShopSmart)

The.Comedian/flickr

You know how many credit cards say they they double the manufacturer’s warranty? It’s the reason why I pay for major appliances with credit, not my debit card or a check, and why I almost always turn down an extended store warranty.  I’ve read about the warranty doubling in promotional materials but, until today, I never knew what this perk really meant and how it worked. Here’s what I found out.

I purchased a rather expensive window air conditioner from Sears one year and three days ago. I purchased this item from Sears only because I could not find this A/C unit anywhere else that included free shipping. I knew Sears did not have a friendly return policy. I did not buy an extended warranty because I knew my Discover card included an extended warranty.

Now it is 368 days later. I discover that

an important part of the A/C unit has disintegrated and needed to be replaced. I called Sears and was told “3 days past warranty. Nothing we can do. Call your credit card company.”

I was so proud of myself. I actually found the copy of the credit card statement that showed when, where, and how much I spent for the air conditioner. I called the credit card company. They kindly gave me the phone number of the insurance company I had to call to file a claim.

I called the insurance company. The guy on the phone let me know that it would take 15 minutes to complete the phone call. I said, “OK.” He wanted my name, all my contact information, the day, place and price of purchase. He also wanted the model number and the serial number of the unit. He also wanted to know what day my unit broke. He then told me that I would be receiving an email with paper work that I needed to fill out, a claim number, and a website for further instructions. To fill out the claim, I would need all the above information he already took, plus the original receipt, the original manufacturers warranty in writing, a picture of the unit, and a written estimate of what it would cost to fix the unit. I would then submit those and they would consider the claim. I would hear from them within 4 to 6 weeks! If they decide to pay the claim, they send me a check.

Wow! That certainly is NOT easy. Had my unit broken 3 days earlier, I would have had a part sent to me for free and/or I could have taken it directly to Sears for a fix. I’m lucky that my air conditioner still functions. Otherwise, the extended process to redeem the extended warranty would render the warranty useless to me because I don’t want to go without air conditioning in the middle of summer. I’d buy another unit or pay for the repair myself.

Hummm. I’m not really all that enthused about my extended warranty through my credit card anymore.

Of course, I do not know how this story is going to end. The good news is that I have found my original receipt (I have a great filing system) and the original manufacturers warranty. I submitted my paperwork — but I’ve still got at least 4 to 6 weeks before I hear back from them.

Have you ever used your extended warranty option on your credit card? What happened?

wrestlingentropy/flickr

My son has officially become an adult. I know because he gets credit card applications almost every day. I’m amazed at what banks are offering a teen who does not have a job or any way to pay off the debt he might incur. Juxtapose this against the tremendous scrutiny that my credit report underwent recently when I applied to get a mortgage and you can see that something is amiss. Why is my penniless son being lured into debt while the banking industry is making great credit-scored working adults pay huge fees to get a fully collateralized mortgage? Sorry, I don’t have the answer to this question, but if anyone else does, be sure to enter a comment so that I find out the answer.

What I DO have the answer to, is how to save a lot of money by being on time with your bills and keeping on top of paperwork.

As I stated, my son has been getting frequent credit card offers. I don’t shred them. I read the fine print with my kids as a way of educating them to the perils of over-extending your credit. THEN, I shred them.

Instead of going into the fine print of your credit card contract, I will state firmly that if you are a person who wants to keep out of debt, sit down with a dictionary, a magnifying glass, and something to calm your nerves as you make your way through the maze of fees and penalties that can befall you if you miss a credit card payment. Although the contract does not state that the bank will send someone to break your knees with a tire iron, they will produce a similar result by raising your interest rate to a sky high amount AND possibly informing your other credit card companies that they should do the same as well.

Granted, the reforms of the Credit Card Act of 2009 have caused the credit card companies to make their type faces bigger, their words more comprehensible and their fees less hidden. However, the truth of the matter is that if you fail to pay a bill on time, you will pay more than necessary. Sometimes you will pay LOTS more.

People usually pay their bills late for only two reasons:

1. They don’t have the money.
2. They forgot or didn’t know the bill was due.

No. 1 can often be avoided by only using your credit card to purchase things that you already have saved money for. When the bill comes, you have the cash. Of course, there are other reasons that people don’t have money to pay their bills, such as losing their jobs or an unexpected emergency. An emergency fund is one way to safeguard against this.

No. 2 is easily remedied. Set aside time once a week to work on your finances. I don’t want to sound too simplistic here, but if you make at least 30 minutes each week to balance your checkbook, pay your bills, go over your budget, and plan out your financial actions for the week, you will avoid most penalties and fees associated with lateness or being overdrawn. I’ve been doing this for decades and I attest that it works.

The best and worst states to live in for online shopping. California, it’s not looking good. (Wallet Pop)

Get your weekend started with Bargain Briana’s extensive list of Friday Freebies. (Look for it on her homepage about 10 a.m. EST/7 a.m. PST).

Could you live on $330 a week? A lot of people do. Here is how one woman named Cindy does. (MSN Money)

Credit card debt increasing – The entire decrease in credit card debt was due to write-offs, not to consumers actually paying down their debt, a recent CardHub.com study reveals. How depressing.

Facebook challenges Groupon – Social media giant Facebook just introduced a new daily deals page that will directly compete with Groupon. (Bloomberg)

My $37.89 credit card regret.

My credit card bill is due in a few days and while reviewing my charges from the past month I found one that I really wish I could take back. While stopping at California winery for a tasting in July, I bought a handmade vintage mini-quilt to hang in my office. The cloth, folded so a fourth of it shows above, can also be used as a table covering.

Purchase price? $37.89.

The cloth has picket fence edges and the material is very sturdy and soft. I like thinking that a woman used her creativity to sew a beautiful work of art that is entirely practical.

When I inspected the cloth more closely at home, however, I found a small stain and realized four circular embellishments were added to cover an inch-long rip. You can see one of the embellishments in the top right corner of the photo. I still adore the vintage cloth, but I think I could have found something similar at a thrift store or flea market for less than $10.

So if there is one credit card purchase I regret this past month, it is this mini-quilt. I was a bit tipsy when I made the purchase, and saw so many cute things in the shop (like cherry earrings for $10) I wanted to take home something. The earrings were only worth $5 to me, but maybe if I had bought those I would have passed on the cloth. At least I didn’t splurge for the vintage $25 waist apron. It was so adorable I never would have worn it!

What do you regret buying this month?

jekert gwapo/Flickr

This is a post by BargainBabe.com writer Yazmin Cruz.

I have a confession to make. I am addicted to coffee – the pricey frapps and ice blended drinks. But that’s not my only problem. In order to keep up with my caffeine addiction I’ve been charging the drinks on my credit card. Not smart at all, especially when I carry a balance.

I didn’t realize how bad it had gotten until I was reviewing my e-bill and noticed almost half the charges made were at coffee shops. My addiction began about six months ago when I took on more responsibility at work and couldn’t get out of the newsroom until 10 or 11 p.m.

Waking up extra early didn’t help either. By 3 p.m. I needed a pick me up and walked to a local coffee shop for my fix. If I didn’t have cash on me I would simply charge my $4 drinks. In no time my habit added up to $20 a week. Now I pay for my indulgence plus interest.

I shared my dilemma on the Bargain Babe Facebook page and many readers offered solutions that I am implementing. Here’s my plan. First, I’m going cold turkey. I had my last ice blended drink this weekend. I am not frequenting any coffee shops for a while and most importantly I am working hard to pay off my credit card debt. Note to self, don’t use plastic to pay for food or drink!

I am also fighting my expensive coffee addiction one tea bag at a time. Compared to coffee, tea is less expensive and doesn’t add extra calories (unless you add cream). I am using my coffee maker at home more often, as reader Janna suggested:

“I make my own cappuccinos now. I have a Senseo, which I *love* ($.25 per cup). I warm up some milk in the micro, then foam it up with an Aerolatte; simply awesome. For the counter space saved over a home espresso maker and the cost you can’t beat it.”

Having worked at a juice bar, I have enough experience to tackle making coffee at home. I also have an Aerolatte so I just need to commit to doing it myself.

Related posts:

I wish I hadn’t bought…

What tempted me to use my credit card this month

To reverse my spendy trend, I decided to carefully plan my errands and grocery trip yesterday so I would only have $5 extra with me. More often than not, if I always have an emergency $20 bill on me, I’m going to spend it. I estimated the cost of my errands ($5 – shoe repair guy; $25 – groceries; $5 – vitamins) and put $40 in my wallet.

The shoe repair bill was actually $7, raising my awareness of my remaining dollars. My first grocery stop added up to $11.87, an insane amount for three items (hummus, cheese, and salsa). I have a tasty hummus recipe and am debating making my own.

When I arrived at the second grocery store I was hyper aware of how much  money I had left over – $21.13. Having a finite amount of dollars influenced what I purchased. I bought super cheap in-season strawberries for $.99 instead of bananas, and passed on sliced lunch meat so I could buy chicken thighs and pork chops, the two most expensive items on my list.

As I put each item into my cart, I wrote down its cost. When I felt I was approaching my dollar limit, I added everything up, including tax. Having to pay close attention to – no, being controlled by my limited funds – was painful. With a credit card, I do not limit myself when it comes to food. I aim to spend about $27 a week on groceries, but if a staple is on sale or I see a good deal, I do not hesitate to overspend. With cash, I don’t have that option.

By the time I made it to the drugstore to buy vitamins, I had a little over $6 left. I could pay for the vitamins using a $4 off coupon and the spare coins in my wallet, but I walked out of the store emptyhanded. It didn’t feel right to go home penniless.

Andres Rueda/Flickr

One reader responded to my credit card moratorium with a detailed blog post about the cash back rewards I am giving up. The info was so useful I wanted to share it. Here is Marie’s post:

“Different strokes for different folks,” goes the saying.  And that applies most definitely to credit cards!  Now, I can see the benefits of trying to rein in one’s spending by using cash only for discretionary purchases.  If you leave your credit and debit cards at home and have only your available cash to use, you are obliged to be cautious about your spending.

But, when used for larger payments, credit cards that offer 1% to 5% cash back can be very rewarding.  Here are some approximate bills you probably pay and how much you can earn with a 1% cash back credit card:

• DMV ($2.50 rewards for $250 DMV payments)
• Car Insurance ($10 rewards for $1000 payments)
• Home Insurance ($15 rewards for $1500 payments)
• Home Earthquake or Flood Insurance ($15 rewards for $1500 payments)
• Renters insurance ($2.50 for $250 payments)
• Car dealer down payment ($50 rewards for $5000 down payment)

NOTE:  All these benefits can be nullified if you pay high interest rates.  So use your Rewards card wisely.  Make sure you budget to pay in full (or installments), just as you would do if sending the payment by check.

You can also earn cash back rewards on many regular monthly payments:

• Time Warner Cable fees (at $60/month payment, cash back of $7.20/year)
• Direct TV fees (at $60/month payment, cash back of $7.20/year)
• Cell phone bills (at $50/month, cash back of $6/year)

Some credit cards offer special quarterly 5% cash back offers for purchases made at specific types of stores, like grocery stores, drug stores, department stores, home improvement stores, and clothing stores. Three sites I like for these types of credit cards are CapitalOne, ChaseFreedom or Discover.com.  Spend $200-$400 per quarter on these special offers and the 5% cash back rewards will earn you $40-$80. You can also search for Visa and Mastercard reward cards at CardRatings.com.

me and the sysop/Flickr

The votes are in, I’m going credit card-less for one month beginning April 1 despite the disadvantages of giving up credit. Here’s how I’m going to prepare.

• Hide my two credit cards in my jewelry box so they are out of sight, out of mind.
• Average my credit card bills from Jan, Feb, and March and set that as my spending limit for April.
• Head to my local bank branch to withdraw a fat roll of cash (my average credit spending from the past three months).
• Carry around $100 at a time for security.
• Begin spending!

My biggest concerns are safety, not having enough cash on me, and figuring out what to do about online purchases that require credit. I’ve decided to keep paying two bills - cell phone and student loan – as I have in the past, through a transfer from my checking account. These bills are consistent month to month and I don’t have the option to not pay them. My focus is on how using cash changes my day-to-day spending, not my fixed expenses. Remember how I got into this mess?

Okay! Ready, set…cash!

UPDATE: Joe asks:

Does that also mean no debit cards? I don’t use credit cards often, but I live by my debit card.

Yes, Joe, that means no debit cards. I’m going to be free of plastic!

Janet has a neat system that tricks her brain into thinking she only has cash:

BlatantNews.com/Flickr

This post is brought to you by Coupon Cactus, a great source of online coupon codes for taxes, groceries, and more.

Gulp. Readers overwhelmingly supported my experiment to give up credit cards for one month and rely solely on cash. When I last checked, 86% of readers said go for it, 8% suggested an alternative, 4% said leave the plastic at home, and 2% had no opinion but were nice enough to vote.

Richard would never give up using credit cards because of the perks he earns.

We use our credit card for everything we can. Why? Airline miles. Last year we flew roundtrip to London, business class, for a total of $330 (taxes). However… we immediately deduct all purchases from our checking account (Quicken), sort of a pseudo-debit card so it’s like we pay cash. I pay the credit card bill online a day or two before the statement date so our credit report shows minimal card usage.

Ellie D.’s cash-only system has withstood the test of time:

Having a pay-as-you-go routine is definitely more economical than using cc’s for all your expenditures. I withdraw a certain amount of cash from my checking account each month, and ration it out on a weekly basis. When it’s gone, that’s it! However, I usually have something left at the end of each month, which means withdrawing less $$$ the next month. I do use cc’s on occasion, but pay them off monthly, and have never had a debit card.

Ashley pointed out three major disadvantages of using cash-only:

…a reason I have had problems making the switch is that I use mint.com and if I use cash it can’t track my purchases (I could but always forget to update and next thing I know I don’t remember if I spent $5 on groceries, $10 for a meal and $5 for parking or was it $10 on groceries and $5 on the other two. And finally, going only cash you can’t gain points that are available with some credit and debit cards and you can’t shop online where sometimes it is possible to find a better deal on products.

But Jenni says there is one major perk – staying on budget!

A dear friend uses this method All The Time, and she has 3 girls in various activities. Her budget is planned down to the penny, and when they are paid she gets out the cash she will need for the entire month. She bags the cash for their activities and labels them (i.e. “piano”, “ballet”, etc.), then does the same with her bills (“market”, “cleaners”, etc.). She even has a “miscellaneous” baggie for gifts and mishaps. She saves quite a bit of money every month, and she and her hubby are self-employed, so this helps in leaner times. Her spending is never out of control! LOVE her organization.

Tamara is going through a similar process:

I am in the process of transitioning to all cash. I think it will make me think twice about my purchases, and I am going to split up my money into jars to better track where my money is going using Gail’s system (http://gailvazoxlade.com/blog/).

All of this discussion makes me want to take a closer look at the perks I am earning using my credit cards. Which is greater? The credit card rewards I am earning or the money I am saving (as many readers say I will on a cash-only diet) by leaving the plastic behind? I won’t know the answer to this question until the end of the experiment, which begins April 1.

In the next few days I’ll think about how to deal with online purchases that require a credit card and what I’ll do about bills that I pay on my credit card. What other guidelines should I set before the cash-only experiment begins April 1?

Brithanglishman/Flickr

Time to play that game again where I review my monthly credit card bill and pick one purchase. That I really. Should not. Have bought.

Groan.

This month’s dishonorable mention goes to the $10.99 I spent getting my car washed and vacuumed. Yes, my mother was coming to town and I wanted her to think my car is always neat and tidy.

But making time to wash it myself at the drive-in car wash would have done the job just as nicely – and only cost $4. Last month’s regrettable credit card purchase was a USB postal scale that cost me $8.10. Readers had plenty of spending problems, too.

On a happier note, my credit card bill last month dropped significantly – a few hundred dollars. Was it tied to the self-induced public credit card bill flogging? Perhaps!!

What do you regret buying this month?

UPDATE: Christine regrets a sweet birthday purchase.

Oh boy! I’ve got a doozy! My daughter turned one year old this past weekend and we were having a SMALL party. Nothing fancy, just cake and appetizers. I was in a hurry and had heard about a great bakery in Canoga Park. I went in and spent $70 on a cake for a one year old. I must have been out of my mind. I could have gone to Costco and spent $16.99. ARGH!!! DUMB, DUMB, DUMB. The cake was good, but not THAT good! Lesson learned!

Mike has NO regrets. Kudos to you!