Welcome to Mound of Money

iBankBonus has compiled a list of bank bonuses. The list is particularly helpful, because you can view bonuses available by state, as well as see a brief overview of the terms of the bonus. I tend to sort by bank bonus value.

Some terms include:

• Initiate ACH transfers
• Set up recurring payments
• Set up direct deposit
• Complete forex transactions
• Account minimums

Just remember to take screen shots of all the confirmation pages, and offer pages so the banks don’t make a ‘mistake’ crediting your account with these bonuses.

All it takes for someone to identify you is 33 bits. 33 bits isn’t a magical number, it’s just that 2 to the power of 33 happens to be close to the number of people on the face of the planet. If you ask the right 33 yes or no questions about a person, one can identify a specific person anywhere – sometimes with far fewer questions. With all the traces of data you leave on websites such as facebook, twitter, etc it’s pretty easy to identify you, as well as your shopping habits, college major, favorite foods, income, address, how many children you have – and the list goes on.

IT should come as no surprise that companies are capitalizing on the breadcrumbs you leave behind while surfing the net. xplusone.com states they “serve the right message, to the right person, at the right time.”

What if this system of ultra-targeted advertising could be manipulated in your favor? It seems like the information you leave on the internet could be tweaked to show you in a better light.

If credit card companies are using where you shop to develop targeted credit card offers (like Capital One), it could be beneficial to pay cash at low end places like Wal-Mart, but to always pay with credit and tweet about your meals at expensive restaurants. Someone could possibly subscribe to golf and yachting magazines to boost their profile with high end retailers or creditors.

Next post: Credit cards and places to shop (or avoid) to boost your profile to merchants and lenders.

So, we all know that our online data is being used by companies to target advertisements with pinpoint precision. However, advertising is not the only use for data collected from your internet usage.

For instance, did you know that ordering pizza can affect your ability to obtain a mortgage? If a college grad is living with his or her parents while saving for a mortgage, while claiming apartment rent, data collected from online pizza delivery can determine where you live and tie that data with who actually owns the home. If someone is trying to refinance a home, but pizza is ordered to a home in another state, it becomes apparent that the home is not a primary residence.

Where you shop can also be used to identify those with disposable income. Targeted mailing, internet advertisements, etc can be directed based on the type of store credit cards you hold. A person with a Nordstrom’s card is perceived to have more income than someone with a TJMaxx credit card.

A recent blog post by a scientist with AVG suggests his facebook information was used by his bank to confirm his identity. He suggests the age of his daughter in law was used in a security question.

All of this seems a bit creepy. However, if you can get past being creeped out, there could be some fun ways to trick corporations into thinking you are more wealthy than you actually are. More on that later.

Here’s how the deal works: Buy coins from the US mint at face value online using your credit card. The mint is quite generous, and is offering free shipping on direct ship orders. Since these coins are actual currency, they can then be turned in at your bank. Pay off the credit card with the coins, and repeat. There are some credit cards offering 2% cash back on purchases, which on a $5,000 would net you $100 in credit card cash back (Charles Schwab, Fidelity Retirement Rewards cards). Rinse and repeat for a nice income stream.

All good things must come to an end. For those of you who made money on this deal, congratulations. However, be careful. Some credit card issuers are now classifying this as a “cash equivalent” transaction, in which cash advance fees and rates apply. The fees and lack of a grace period are likely a deal breaker. Don’t call the credit card company to find out how the purchase will be categorized. Test the waters with a small initial purchase, where any possible fees will be small. Then, look at your account ledger to see if the transaction posted as a purchase or cash advance.

David Bach was on the today show this morning. He was touted as a financial expert. What?!? He is proof that financial advice on TV is a disaster waiting to happen. This guy published a book in 2006 titled “The Automatic Millionaire Homeowner.” In 2006! Anyone remember anything about 2006? It was a turning point for the housing market. He was a cheerleader – encouraging folks to purchase a home at the height of the housing bubble.

David Bach is probably the last person you should be taking advice from – unless you’re trying to sell a book.

Transunion is charging to place a credit freeze on your file. The charges to add, lift, or remove a credit freeze vary by state and can be found here. Some states even have differing charges based on your age. Here’s an idea. Make them free…But if they were free, it would hurt TransUnion’s business model.  We wouldn’t want to hurt a credit reporting agency’s business model in an effort to help consumers against fraud, would we?

Okay, so this doesn’t improve your score directly, but there are benefits. Freezing your credit report with Experian will keep your Experian score from going down due to hard inquiries when applying for credit.

So, you want to apply for some credit cards, or otherwise initiate a bunch of hard pulls on your credit report, but are worried about the consequences of hard inquiries staying on your credit report or a dip on your FICO score. You already know about bumpage, accelerated bumpage, and choppage, so you’re not too worried about your Equifax or Transunion scores being hurt. What about your Experian score? (Remember, bumpage doesn’t work with Experian.) Just freeze your credit report with Experian. The hard pull that would otherwise be on Experian will likely redirected to a different credit reporting agency (CRA) – either Transunion or Equifax. The risk being run is that the institution trying to pull the Experian report will decide not to pull from a CRA, and a denial letter will be sent. I’m not too worried about getting denied credit – if my score stays in tact. Don’t forget, if you really want to, you can “thaw” your credit report temporarily, or remove the freeze altogether.

Clark Howard has a good guide on freezing your credit report with links to the various CRA’s websites. The cost is $3-$10 per bureau to freeze, and a cost to thaw per bureau of $0-$10.

I’ve been using App-o-Ramas and Bumpage along with credit card churning and selective credit freezes to turn a profit – and I have profited significantly from these practices. There are a small group of folks who know about these tactics and use them to their advantage. These ‘credit hackers’ take on the big banks with their legalese and beat them at their own game. These ‘credit hackers’ have done a good job prying profit from the giant monster mega-banks, but thanks to a recent paper (which I refuse to link ) and a speech at the Defcon hacker conference, banks might decide now is a good time to change the rules of the game.

A (creepy looking) Harvard student fellow, Christopher Soghoian, thinks these practices should be eliminated. Why? Because they might be a tool in the hands of identity thieves and it costs the banks money. I believe he wanted to publish a paper about ‘credit hacking’ (Which isnt hacking at all. It’s using the rules of the game against those who wrote them), then earn big bucks doing consulting work.

Guess what Chris… The banks already know. They’ve known for quite some time. They’ve made a deliberate decision not to do anything about it because the costs of eliminating the loopholes are greater than the benefits. Don’t you know anything about cost/benefit analysis? Or, are you too busy printing fake boarding passes to learn anything finance related?

The good thing about the nature of the community of ‘credit hackers’  is if their current methods no longer work, they’ll find a new way to beat the system. Thats what hackers do.

Many credit unions and banks offer “rewards checking.” This essentially means if you meet basic qualifications with your checking account, you’ll earn a high interest rate. Most of these institutions are for locals only, but some are available nationwide. Currently, the best natinally available interest rate for rewards checking is Founder’s Bank at 5.01%. That’s significantly better than the current interest rate of ING direct.

To earn the high interest rate for a given month,  you must meet monthly qualifications. The qualifications are 12 debit card transations, sign in online at least once a month, and one direct deposit. The direct deposit requirement is easy, especially if money is pushed from your ING, HSBC, etc. online accounts into your Founder’s Bank account. Signing in is a no brainer. But, the 12 debit card transactions means you actually have to use your checking account as the bank intends, instead of your intent to use it as a savings account. I make small purchases on a regular basis in convenient stores, so I can use the debit card there. Another method would be to schedule small payments to yourself via paypal.

So, its not really easy to earn the high interest rate if you don’t intend to use the account, but the dangling carrot of 5% APY is enough to make me jump through some hoops.

Use coupon code “napkin” for 80% off at restaurant.com. Don’t forget fatwallet.com cash back. Try to find a restaurant that gives $25 off a minimum purchase of $35 for the best deal.

Restaurant.com coupon code napkin expires 7/28/09.