I really enjoy using the clipping mask feature in Photoshop. Starting with a grunge brush makes all the difference in the world. I like the effect you get when you couple a grunge brush with the clipping mask. With the font I used one of my purchased commercial fonts with the drop shadow and stroke layer style.
The one I designed today is for a mock-up for a Tattoo Store. I think it would make a great flyer or website ad.