High interest rates are bad right? When you have a credit card yes. But when you are putting money into a savings account or CD you want higher rates.

HSBC, ING and other online banks have reduced their rates since the Fed cut rates. For people searching for a loan this is great news (if you have a decent credit rating). This is not so great if you want to save money. The stock market or even real estate is good for a long term investment. If you need your money within a shorter time frame like a year or so or you are creating an emergency fund, you would want to have money in “liquid assets” – cash or a form that can be easily converted into cash.

The interest rate for saving has been decreasing but if you check around you can still find an interest rate that is above 2.7% or the rate of inflation for the last quarter.

Americans know we are not savers. Earning 3% isn’t the way to make you become one overnight either. There is hope though.

Here are some alternative tips, instead of socking away all of your extra cash right now.

Pay down high interest rate credit cards. This will definitely give you a good return on your money.

If your mortgage rate is in the 6% range, by adding money to your mortgage principal you will increase the equity in your home.

Add a few extra dollars to your mutual fund. In the long run every little bit helps.

Search around for the best savings rate and put some money away. Some interest is better than no interest.

I Series savings bonds earn 4.28% through April 2008.

You still may want to have some cash and if you have $5000 or more you can possibly find a good rate for CDs at a traditional bank. The rate may be higher and banks are eager to get business. When they have your money then they can loan it out to someone else. If you can meet the minimum, then you should try to lock in a higher yield now.

Some large banks are offering very competitive rates but you have to jump on them now and many of them require large deposits. Washington Mutual is offering an incentive to people who want to save. The best rates that are being offered are 4% APY for 6 months with a minimum deposit of $1000. For a savings account to get the best rate you will have to have another account with WAMU to get 4.25%. So you can open a free checking account with $1 and earn 4.25%.

Chase offers 2.25% for a $1000 CD for all of the terms listed on its website, but also states that rates vary by market. If you have $10000 for a 4 month term you can earn 3.5%.

The best bet would be to find a teaser rate for a bank or credit union in a standard savings account. Later when the rates increase you will have some cash that you can take out and purchase a CD. Having some cash available is always a good in case you have an emergency.

Rates are going to go down further given the 2 rate cuts by the Feds within 10 days. So if you are planning to sock away some cash, now is the time to do it.

Tired of pinching pennies? Leftovers got you down?

Instead of eating the same thing over and over, use some of your leftovers to make something entirely new with the ingredients you already have.

Last night I made a 1quart casserole dish of chilaquiles. I had never made this before though I had it several times. Chilaquiles can be made with eggs for breakfast or with meats and strips of dried tortillas. Think Mexican lasagne. Instead of buying ingredients, I used the scraps of tortilla chips I already had along with some cheese and voila a new dish. Making this was especially helpful because the temperature dropped about 20 degrees in a couple of hours yesterday. So I had some added heat from my oven while I was baking this dish.

A brand new dish with old ingredients. Reusing leftovers doesn’t have to be a terrible thing. Instead of making something new: Go ahead and freeze some of the food in smaller portions for a later date.

Food seems to be the one area that people can’t get around even when the economy is tight. Now is the time to add some new dishes to your cooking repertoire.

If you are tightening your budget and forgo eating out as much as you once did, eating does not have to be boring. Even if you buy quality ingredients with an inexpensive bottle of wine it will cost less than an evening at a restaurant. Frugal doesn’t mean that you can’t have the occasional roast or steak but if you don’t want to eat that over and over until it is gone, plan ahead and think about what you can do with the leftovers.

If you have part of a steak left over from a meal, cut it into small pieces and put it over some jasmine rice, some noodles or stir fry mix. You could also use some slices for a sandwich or for fajitas.

You can make something similar to your favorite food at home for less. You may like the fast food chain’s burgers but are they as good as your favorite burger joint’s when you are looking for a real burger? No! So, learn to make a favorite at home. Chicken sandwich more your style? Buy some boneless skinless chicken, season it up and go. Many prepackaged seasonings are available in lower sodium packets so you just add it to the meat of your choice and cook. Do not just buy the prepackaged, pre-seasoned meats that are near your meat counter. Even though they are already prepared…. they cost a lot more and you still need to cook them. The rotisserie chickens that are sold in most groceries can last you a while and you can use that as your starting point by adding a side, then using the leftovers anyway you choose.

You can save money by cooking and eating well at home.

As I was flipping through a magazine, I saw an article featuring some high-end clothes for children. There were outfits starting at $200 and going up. When I was a child, I didn’t have designer clothes. Although I don’t think there were any real designer clothes. Two hundred dollars could buy a child’s wardrobe.

Children are just additional pawns in the consumer wars. Looking fashionable and presentable was always something important as a teenager. You didn’t want to be an outcast. The outfits for younger children who can barely read and will definitely grow out of them soon makes no sense to me. I prefer to buy something that will last and has a more classic look so I can wear it for a lot longer than just that season.

What about the adults? The economic stimulus package that is being bounced around is so that people can continue their lifestyles. Basically, we spend too much, and save too little. We have been doing that for years and now we have come to a crossroads. In order to preserve our lifestyle (a nicer word than poor, middle or upper class status) we need to have some spending power. Those with the least spending power will have less in a recession and those who had more have less during a recession.

Retailers are being innovative and trying to toss in little perks to get people to spend the money that they do have. This doesn’t mean that people have something to spend. For some the spending hasn’t been with cash and that’s the crux of the problem.

Some Americans are coming to saving late. Being thrifty and frugal was not seen as something that was cool. It’s as though we were all galloping along and pulled the reins of our horses and then we were thrown off.

I think that the money we receive as part of the stimulus package should be saved, donated and spent on local items. If you don’t have debt. For those in debt, use some of it to help you get out of debt. If you buy something with your government money, make sure it is made in the United States or supports a local business in your community.

We do not need to spend more to enjoy life. You can enjoy life on a little. Money may fail you but if you learn to life on less you will make it. Bring back thrift.

Michael Kinsley sums it up well…

“Here’s a thought. Suppose we don’t go further into debt in the name of fiscal stimulus. Suppose we stop selling ourselves piece by piece to foreigners (and suppose we stop blaming the foreigners for problems of our own making).”

I agree and while we’re at it put some money away for the future as well.

The financial industry is struggling right? If your mailbox is any indication, I don’t think so. Every day more and more opportunities to get another credit card or get another offer online are sent directly to consumers to consolidate a loan or take out another credit card.

Personally, I have enough credit at the moment. Actually, the amount of credit that I have and the amount of credit I use haven’t even met. Yet, I still take the time to get rid of these offers especially the ones that come in the mail. I shed them thoroughly. This will stop identity theft.

When I have magazines, that I no longer want (or even catalogs) I shred any section that has my name or customer identification on it before passing it on to someone else or putting it out for recycling. Why? Because this can help reduce my risk of identity theft. According to the Better Business Bureau about 90% of the data retrieved to use to perpetrate a theft is gotten though offline sources. So things we throw in the trash, receipts, etc can be used to gain access to your personal information. About half of the ID thieves are people who know their victim, co-worker, a neighbor, friend or relative could be stealing your information.

Check your credit report annually at Annual Credit Report to make sure there are no discrepancies. Especially if you are planning on making a large purchase like a home or an automobile. This will only help you see whether or not there are some flags on your credit report. An annual credit report from one of the big three companies will not give you your credit score for free but if you have been paying regularly on time then you shouldn’t be afraid of seeing your score when the time comes.

This is why it is important to check your statements regularly even though you have automatic payments established. Also, check your receipts in restaurants, or stores to make sure you aren’t charged for something unknowingly.

Magazines? A magazine that offers you a great rate may be an awesome deal. So you paid $15 for a year’s subscription to a magazine. If you paid by credit card, what you may or may not know is that you could be automatically renewed at the “standard renewal rate” whatever that is. So next year your great deal may be twice or even three times the amount… more than you paid and also more than you would pay if you responded to an online offer or sent in a subscription card.

Stay alert when online. Do not follow a link from an email claiming that you need to update your payment information or your service will be terminated. Some of these items still get through spam filters, so you need to delete these offers and if they get through, report them as spam.

Some credit card offers and other things will still get to you, but in order to decrease the amount that you receive, you can call 1–888–5OPTOUT. This will direct you to a number shared by the Credit Report Associations and you can decrease the amount of offers you receive in the mail. For permanent removal, you will receive a form in the mail that you will have to complete. If you change your mind in the future, then call the same number.

By taking a little time you can greatly decrease or eliminate most if not all of the credit offers that you receive and help preserve (or build) your credit so it will be there when you really need it.

Christmas was a month ago and some people are still recovering from their holiday debt. After you pay those bills down, start saving for Christmas. If you spent what you could afford or waited until after Christmas to get people gifts because you didn’t have the money before Christmas, start saving for Christmas.

It may seem crazy to start saving for something that is 11 months away (334 days to be exact) but if you start saving for Christmas now, even just a little each week then you will have an advantage over the other people and won’t have to suffer the post-Christmas blues because you overspent.

Saving for Christmas doesn’t mean that you are neglecting other savings plans, bills or investments. Think about if you started saving $100 a month next month and did that through November you would have $100. You can even break it up into smaller chunks. Instead of saving the $100 all at once, maybe you want to save $25 a week for 40 weeks. Even starting late, you still are only saving or 10 months out of the year. So if you didn’t want to save money one month in the summer or if you don’t need that much then you could cut back.

Lets say you don’t have a regular income or work on commission, you can still do this. Just make sure that you have money for your needs first (including savings) then you can put a little aside for later.

Whenever you get an unexpected chunk of money, instead of just blowing it all, put some aside. So if you are entitled to a tax refund, use some of that to help boost your Christmas savings, spend some and put some into your emergency fund. Christmas and your emergency fund should not be the same.

If you are saving for Christmas throughout the year and put it in an interest bearing account you will earn a little money.

Don’t be saddled with debt after Christmas, plan for it. This way you aren’t stuck with credit card bills after you have enjoyed Christmas. This savings scheme also works if you want to save for a vacation, or other large purchase.

For those who lack the diligence to save and not touch the money before its needed, check with your bank about Christmas savings programs. Some banks and credit unions have established programs. If you have the willpower, open an online account, regularly transfer money into the account and watch it grow until its needed. If you have more willpower but forget, you can schedule recurring transfers from your checking into savings. Take your spare change, dump it into a jar over the course of a month and deposit it into an account and you will see how much you can accumulate. It may not be a consistent amount, but it will be a start.