Background: Million Mile Madness was the mad quest to earn a million points in one month. Throughout March, I did everything I could to earn as many points as possible while keeping within my ethical boundaries. During the month, I tracked all of the points that I expected, and I declared victory when the expected total topped one million.

It wasn’t easy to earn a million points in one month.  I started the month with a burst out of the gate by signing up for 11 credit cards in one day.  I was approved for 10 of the cards and I earned 516,000 points from sign-up bonuses (you can read the details here: Million Mile Madness: The big churn story).  Then, the hard work began.  With 484,000 points still to earn, I had to find a way to average approximately 24,000 points every weekday for the rest of the month.  My approach for acquiring most of those points and miles was to buy and sell: Earn as many points as possible while buying items and resell those items for as little loss as possible.

Preparations

In the months leading up to my Million Mile Madness challenge, I tested many different scenarios for earning points through purchases.  I looked for opportunities to get points for buying gift cards and for using the gift cards.  That’s known as a double dip.  I also looked for (and found) a few instances where one could get points for buying a gift card, then get more points for using that gift card to buy a different gift card, and then finally get even more points when using the latter gift card to buy merchandise.  These were triple dip opportunities.  Each of these opportunities made use of shopping portals and, often, credit card category bonuses to increase points earned.  For details about some of the tests I ran, please see “Million Mile Madness: Preparing to buy & sell.”

Watching for deals

The site SlickDeals was my best friend that month.  For each of the merchants where I knew I could earn lots of points, I setup email alerts within SlickDeals.  I wanted to be alerted to hot deals as they appeared.  This proved to be a huge help, especially for deals from Staples and OfficeMax.

Buying like mad

Whenever a great deal would pop up, I quickly did some research to see if I could resell the item easily.  My first stop was always to Amazon.com to see if Amazon would let me list the item as new and use their Fulfillment by Amazon service for the resale.  I would also check to see the price I would likely be able to sell the item for and I would get an estimate of Amazon seller fees (see “Tips for selling on Amazon“).  If, after the research, I still thought the deal was good, I would then initiate a double or triple dip purchase.  For example, when I found great deals at Staples, I clicked through from TopCashBack (5.5% cash back at the time) and paid with my Chase Ink Plus card (which offers 5 points per dollar at Office Supply stores).  For an OfficeMax deal, I clicked through the Ultimate Rewards Mall to OfficeMax (the mall offered 5 points per dollar at the time) and paid with my American Express business card with OPEN Savings which offers 10% cash back for OfficeMax.com purchases over $250.  I bought many thousands of dollars worth of merchandise with methods like these.

Selling

When packages arrived at my house, I opened them to inspect the contents, then I logged onto my Amazon Seller account to print out packing slips and mailing labels.  I repacked everything and set it all out by the front door for UPS to pick up.  When just a few boxes were involved, this was easy.  When many boxes showed up at once, it was a huge pain in the you know what.

Waiting

Once items were sent to Amazon, I simply waited for them to sell.  Occasionally I had to adjust my prices to make sure I had the lowest price.  Usually, the items sold out quickly as soon as they were fully checked-in (which could take up to a week).  In one case, I had to edit the listing details to get the product to show up in searches on Amazon.com (and once I did that, the product sold quickly).  In another case, Amazon decided to fight me in a price war.  Every time I lowered my price, Amazon undercut me further.  That was the only item in which I had expected to earn a profit, but I ended up taking a loss instead.

Kohl’s

By far, the most buying and selling I did was with items from Kohl’s.  Through a double-dip I was able to earn 20 points per dollar.  And, thanks to my wife having a Kohl’s charge card, I qualified for 30% off coupon codes that they offered twice during the month.  I bought small kitchen appliances, Disney headphones, toddler iPad cases, Bluetooth speakers, watches, and even a few robot vacuums.  The worst loss I took was 21% (due to the price war I mentioned above), but most items earned a profit.  Profits went as high as 50%, but most profits were in the 1.5% to 13% range.

Staples

At Staples I bought tablet computers, SSD drives, and portable external drives during fantastic sales.  Profits ranged from 5% to 22% for these items.

Lowes

At Lowes I executed a triple dip to get 15 points per dollar, plus I used a 10% off coupon to save money.  I bought a few thousand dollars worth of Nest Learning Thermostats.  Even though the thermostat was on sale and I used the 10% off coupon, I still lost approximately 9.5% on this deal (for details see “Million Mile Headaches: Lowes, Round 2“).

Drugstore.com

When Drugstore.com offered 20% off any health & beauty items, I found (thanks to SlickDeals!) that I could buy Fitbits for 20% off.  When clicking through from a portal, the coupon didn’t apply, so I gave up on shopping portals for this deal.  Instead, I used the 20% off coupon and paid with a credit card that earns 5X at drugstores (my Citi ThankYou Preferred card, for 12 months).  The Fitbits sold immediately and I earned a profit of about 10% on this deal.

OfficeMax

I only took advantage of one OfficeMax deal in March.  A device called Ooma Telo was on sale at OfficeMax for a great price.  I earned 5 points per dollar by going through the Ultimate Rewards Mall and I got 10% cash back by paying with an American Express business card with OPEN Savings.  I only bought 4 of these, but I earned approximately a 14% profit.

Final tally… soon, very soon

Yes, I succeeded in earning a million points in one month, but there was another aspect to the challenge: my goal was to keep my net costs below $1000.  That meant that when buying and selling items, there was very little room for error.  At this point, I still have just a few items that remain unsold, so I can’t yet give a final tally, but I expect to do so very soon.

Learn about Million Mile Madness:

• A crazy million mile idea. Should I do it?
• Million Mile Madness, it’s on
• Million Mile Madness: Strategy
• Million Mile Madness: Preparing to buy & sell
• Million Mile Madness: Tracking points and expenses
• Million Mile Madness: The big churn story
• Million Mile Madness: buying, selling Kohl’s
• Million Mile Madness: Banking on Lowe’s
• Million Mile Madness: A setback from Sears
• Million Mile Madness: Pending Success
• Million Mile Madness: Bumps in the road
• Million Mile Madness: Credit scores and pulls
• Million Mile Madness: Easy points
• Million Mile Madness: Success!!!!!
• Million Mile Madness: Which points?
• Million Mile Madness: How it was done
• Million Mile Headaches: SunTrust
• Million Mile Headaches: Lowes, Round 2

Google is in the process of rolling out new features to Google Wallet that will bring them in direct competition with PayPal, Amazon Payments and others.  With the new version of Google Wallet, you can pay friends and relatives electronically, and you can even initiate payments directly from within Gmail.

Payments sent from a linked bank account or from your Google Wallet balance are free.  And, for a yet to be defined “promotional period” credit and debit card payments are also free.  Eventually Google Wallet will charge a 2.9% service fee for those transactions (with a minimum fee of 30 cents).

Getting the new Google Wallet

Its free to sign up for Google Wallet, so you might as well do so if you haven’t already.  At this point, though, the ability to send money to friends is being rolled out slowly.  Your choices are to wait for Google to roll it out to you or ask a friend (who already has the new features) to send you a penny.  Anyone who receives money from Google Wallet automatically gets the new features.

Write “pick me!” in the comments of this post and I might send a penny to you to get you started.  I say “might” because I’m not sure how many I’ll get away with before I trigger some kind of fraud alert.  I’ll do just a few at a time for a while.  Sorry, but I already have more requests than I’m likely to ever get to!  I’ve deleted all of the “pick me” comments so that we can keep the comments section for discussion.

Fees

Here are the details from the Google Wallet Help pages:

As you can see, Google describes a 2.9% fee for sending money using a credit or debit card.  In practice, though, Google is not currently charging fees:

Notice above how the fee is crossed out?  And, if you press the little question mark button, you get the following:

So, for some undisclosed amount of time, Google Wallet is entirely fee free.

Limits & thresholds

The best alternative service for sending money to friends via credit cards for free is Amazon Payments.  Amazon Payments has a limit of $1000 per calendar month.  So, what about Google Wallet?  Their stated limits are extremely high:

As you can see above, their Help pages say that they allow up to $10K per transaction and up to $50K per 5 day period.  In practice, though, there seems to be more going on.  When I tested sending $75 to a friend, the money went through in minutes.  I then tried sending $1700.  Two days later, the transaction is still pending.  Similarly, a friend I know sent $1000 and that transaction has been pending for about a day.

My guess is that there are transaction thresholds.  Any transactions above a certain dollar amount gets flagged for review.  Unfortunately, I don’t know if that theory is true, nor do I know what the threshold is (if the theory is true).

There is also a chance that Google is actively watching out for people who are using Google Wallet just to earn points & miles.  Within this Flyertalk thread, a contributor claimed to have received the following email from Google:

Hello,

We recently noticed that you’re adding then withdrawing lots of funds from your Google Wallet Balance or sending/receiving money in a way that may violate our Terms of Service.

We wanted to offer a friendly reminder that the peer to peer service is intended for Google Wallet customers to send money to other persons, and not to rack up airline miles/rewards points or get cash advances. We view such transactions as misconduct under section 7 of the Google Wallet Terms of Services, and may decline to process such transactions or close your account if we identify in the future that you are using your account for these purposes.

I don’t know whether the email was real, or if this person was simply trying to scare people away, but either way it is a good reminder to go slow.  Here is the relevant part of section 7 of the Google Wallet Terms of Service:

7. Limitations on Use of Services

Notwithstanding any limitations described elsewhere in this Agreement, we may establish general practices and limits concerning use of the Services, including without limitation individual or aggregate transaction limits on the dollar amount or number of transactions during any specified time period(s). We reserve the right to change, suspend or discontinue any aspect of the Services at any time, including hours of operation or availability of the Services or any Service feature, without notice and without liability. We also reserve the right to impose limits on certain Service features or restrict access to some or all of the Services without notice and without liability. We may decline to process any transaction without prior notice to you.

GPC may delay, hold, cancel or reverse processing of any transaction if:

(a) a Sender makes a claim to GPC for a refund or other reversal, or

(b) GPC, in its sole discretion, believes that the transaction is invalid, suspicious, involves misconduct or fraud, or otherwise violates Applicable Law, this Agreement, or any applicable GPC or Google policies.

Questions and Answers

In this section I’ll try to anticipate readers’ questions, and I’ll answer them as well as I can.  I’ll update this section as we learn more.

Q: Why should I care about Google Wallet?

A: While it is pretty cool that Google Wallet lets you send money directly from Gmail, it is also potentially a great way to manufacture credit card spend.  It could be used, for example, to help meet minimum spend requirements on a new credit card.

Q: Will I earn points/rewards on my credit card when I use it to make payments?

A: Yes.  Here is what Google has to say about that:

You should continue to earn rewards points for purchases through your card issuer’s credit or debit card rewards program (such as gas, grocery, and restaurants purchases, and overall spending), if applicable. Certain benefits and rewards may not be applied when using Google Wallet, such as merchant specific rewards (e.g. double points at a specific merchant with a specific card). Applicability of rewards and other benefits (such as purchase protection or insurance) will be decided by your card issuers and not Google Wallet.

Q: Do credit card companies treat these payments as cash advances?

A: No, these payments are treated as a regular purchases. 

Q: Do any cards offer bonus points for this category of spend?

A: Probably not, but there is a chance that the American Express Business Gold Rewards card may give 2 points per dollar.  From my American Express account, the Google Wallet payment shows up as “GOOGLE WALLET A” in the category “BUSINESS SERVICES – INTERNET SERVICES.”  There is a slight chance that this will qualify as an advertising expense for double points.  Hopefully we’ll learn the answer to that question soon.

Q: How much is safe to send?  And, how often?

A: We simply don’t know the answer to that yet.  Until we learn more, I’d recommend doing no more than $500 per month.

Q: Can I send money to my spouse or friend and have him/her send money back to me?

A: Technically you could do that, but I think that would be very likely to trigger a fraud alert.  It would be wiser to go in one direction and have your spouse or friend send the money back to you through a different mechanism.

Q: Can I use Amex, Visa, or MasterCard gift cards to send money?

A: I haven’t tried that yet, but it should work.  Make sure to register the gift card with your name and home address before attempting to use it to send money.

Q: How do I take out money that has been sent to me?

A: You need to link (and verify) a bank account.  Then, you can withdraw money to your bank account at any time.

Q: Can I send money using Google Play gift cards?

A: No.

Q: Can I send money with Amazon Payments using Amazon gift cards?

A: No.

Q: A while ago you wrote that Google Wallet was coming out with a physical credit/debit card.  When will we see that?

A: I wrote about the physical Google Wallet card in the post “Google Wallet takes physical form. Are more points in our future?“  Unfortunately, Google recently dropped their plans for this physical card.  You can read the details here: Ahead of I/O, Google Wallet Drops Plans to Introduce a Physical Card.

Hat Tip to reader Eric N for letting me know about the new features in Google Wallet!

A couple of days ago, GiftCardMall suddenly disappeared from cash back portals.  I had listed GiftCardMall as one of the best ways to buy $500 Visa cards in the post “Best options for buying $500 Visa gift cards,” but they pulled out of their affiliate channels the same day I posted.  Luckily, they’re back!

FatWallet:

1% cash back, but terms exclude Visa gift cards:

TopCashBack:

2% cash back for regular gift cards. 1% cash back for Visa gift cards:

Sign Up Links

You can find links to sign up for the above cash back portals and others on my “Sign-Up Links” page (which can also be found under the Resources menu of any page on the Frequent Miler site).

Club Carlson recently announced their new summer promotion: stay two nights and get 10,000 bonus points.  There’s no doubt that this is a nice bonus if you plan to stay two nights anyway.  The question I have is whether this promo is good enough to go out of one’s way for.  Is it worth booking a weekend stay just for the points?

Stay two or more consecutive nights anytime between May 13 and July 21, 2013 at any of our more than 1,000 participating Carlson Rezidor hotels worldwide to earn 10,000 bonus Points for each eligible stay.

Details about Club Carlson’s new promotion can be found here.  Make sure to register, just in case!  You can also read Mommy Points’ view of the promotion here; Points, Miles & Martinis’ view here; and Lucky’s view here.

In 2011 and 2012, Club Carlson ran promotions in which it was possible to earn up to 50,000 points for a one night stay.  There was no doubt then that it was worth booking a cheap stay just for the points.  This promotion, though offers only 1/5 the points and requires a two night stay instead of one.  So, this promotion requires deeper analysis…

Near Optimal Earnings

In the post “Earn 70 points per dollar at Club Carlson hotels” I showed how it is possible to stack multiple Club Carlson points earning options onto a single stay.  Almost all of the possibilities are unlocked simply by getting a Club Carlson Premier Rewards Signature card (or its twin Business card).  With either card, you’ll earn 10 points per dollar at Club Carlson properties when you pay with the Club Carlson credit card, and you’ll earn bonus points as a Gold elite member (which is an automatic perk of the credit card).  You could do slightly better with top level Concierge status, but for most people that is out of reach since it requires 75 nights or 30 stays to achieve.

Another way to boost earnings is to sign up for “Club Carlson for Business.”  If you are a business owner, you can get a business account and earn an additional 10 points per dollar for bookings made online.  You will also qualify for a 5% discount off their standard rates.

Here is a full run-down of points earned for a regular stay (without the summer promotion) if you have the Club Carlson credit card and a business account:

• Base earnings for any stay: 20 points per dollar
• Elite bonus (Gold members): 10 points per dollar
• Credit card earnings: 10 points per dollar
• Club Carlson for Business: 10 points per dollar
• Online booking bonus: 2000 points

So, even without a promotion, it is possible to earn 50 points per dollar plus 2000 points per stay (not per night) for booking online.

10K Promotion: 110X

By stacking the points earned as shown above, with the summer 10K promotion, you can now earn up to 50 points per dollar plus 12,000 points per stay.

Ignoring taxes, with a $100 per night stay, you would spend $200 and earn 22,000 points.  In other words, you would earn 110 points per dollar!

How much are points worth?

A few months ago, I looked at Club Carlson hotel prices and redemption rates in a number of cities.  I found that, in my sample, the per point value of Club Carlson points ranged from .22 cents to .89 cents each.  The average point value came to .43 cents.  So, 110 points per dollar is like a 47% rebate.

The math gets better with the Club Carlson credit card which offers a free night with each reward stay of 2 nights or more.  In other words, if you stay two nights on points, you only need to pay for one night!  For details, see “Club Carlson rocks our world… Again.”  So, by focusing on two-night stays, your points can be worth twice as much!  The value of points then (based on my sample) goes up as high as .44 to 1.78 cents per point with an average value of .86 cents each. 

If you value Club Carlson points at .86 cents each, then 110 points per dollar is like a 94.6% rebate!  Clearly, if you’re planning to travel anyway and if a Club Carlson hotel is a viable option, then you will do very well with this promotion.

Taxes vs. Cash Back

It’s hard to estimate how much you’ll pay in taxes since that varies from State to State and from city to city.  Credit card points will be earned for the full cost of your stay, but other point multiples shown above will be based on the stay cost before taxes.

It’s worth noting that there are a number of cash back portals that include Club Carlson properties such as Radisson, Park Plaza, and Country Inn & Suites.  For example, TopCashBack currently offers 9% cash back for those hotels.  If you start your booking from a cash back portal and click through to one of those Club Carlson web sites, you will still be eligible for all point earnings and online booking bonuses.  For a list of cash back portals to consider, please see my Sign-Up Links page.

Overall, rather than trying to estimate the effect of taxes and cash back portals, for the sake of this analysis let’s assume that they cancel each other out.  In other words, I’ll calculate the value of mattress runs without factoring in taxes or cash back.

Mattress Runs

The point of pure mattress runs is to book a hotel stay just to earn points or elite status.  In this case, we’re just talking about point earnings.  If you really don’t value the stay at all and just want to get points, then the goal should be to get points at a cost lower than their redemption value and lower than they could be bought elsewhere.

Club Carlson outright sells points to consumers for just .7 cents per point.  So, even if you value points higher than that, it wouldn’t make sense to do a mattress run if you end up paying .7 cents or more for your points.

Personally, I wouldn’t consider a Club Carlson mattress run unless the full cost was less than .4 cents per point.  The idea, after all, is to get a bargain.  However, if you are working on building up your points for a specific high value redemption (Radisson Blue Paris, for example), you might be willing to set a higher bar.

Here then are the calculations for the cost per point for mattress runs for Club Carlson hotels at various price points with the 10K promotion included:

* Points earned: This column assumes that you achieve near optimal point earnings as described above (e.g. 50 points per dollar plus 2000 points per stay before including the 10K promotion).

As you can see in the table above, booking a $50 per night room just to get points would cost .59 cents per point.  This is better than buying points outright at .7 cents per point, but not by a wide margin.  And, it doesn’t come close to my “buy” target of .4 cents per point.

So, go ahead and book a two night stay if you value both the points and the stay, but don’t book it for the points alone.

Second night add-on

Suppose you have a planned one night stay at a Club Carlson property.  Is it worth adding a second night to qualify for the 10K promotion?  The second night would get you up to 50 points per dollar for the cost of the second night, and 10,000 bonus points thanks to the summer promotion.  Here are the calculations for the cost per point for adding a second night to your stay:

* Extra points earned:  These are the points earned for the added-on second night.  This column assumes that you achieve near optimal point earnings as described above (e.g. 50 points per dollar before including the 10K promotion).

As you can see in the table above, tacking on a second night to a $50 per night stay would result in “buying” points at only .4 cents each.  As room prices go up, the cost to buy points this way increases as well.  So, if you are planning a one night stay in an extremely cheap Club Carlson hotel, it may be worth it to extend your stay to two nights depending on how highly you value Club Carlson points.

Background: Million Mile Madness was the mad quest to earn a million points in one month. Throughout March, I did everything I could to earn as many points as possible while keeping within my ethical boundaries. During the month, I tracked all of the points that I expected, and I declared victory when the expected total topped one million.

Million Mile Headaches

Not everything went smoothly during my million mile quest.  Last week, for example, I wrote about problems I had with SunTrust (see “Million Mile Headaches: SunTrust“).  And, in March, I wrote about some issues I had with Sears (see “A setback from Sears“).  Also in March, I published “Bumps in the road” where I told the story of my botched attempt to get 15 points per dollar when buying items from Lowes.  This is a continuation of that story…

Recap of what went before

I started the month with a plan to earn 75,000 points from Lowes as follows: 1) Use credit cards that earn 5X at office supply stores to buy Home Improvement gift cards at Office Depot; 2) Go through an online portal that offers 5 points per dollar at Lowes and buy physical Lowes’ gift cards.  Pay with the Home Improvement gift cards; and 3) Go through the 5X portal again to buy $5,000 worth of merchandise and pay with Lowes’ gift cards.  If all had worked as planned, I would have earned 15 points per dollar and therefore 75,000 points from buying $5000 worth of merchandise (which I would then resell).

The first $3500 worth of gift card purchases seemed to go smoothly.  I bought out all of the Home Improvement cards available at my local Office Depot.  I registered each card and then went online through a portal to buy Lowes’ gift cards.  The gift cards arrived at my house and all portal points posted as expected.

So, with that success under my belt, I drove to a distant Office Depot to buy more Home Improvement cards and I used those cards to buy more Lowes’ gift cards.  To make a long story short, a computer glitch prevented the new orders from going through, and Lowes’ re-credited my Home Improvement gift cards which I had previously thrown away thinking that they had been used up.  I had to find the original purchase receipt from the Office Depot to get my money back.  And, in fact, I received a refund check from InComm (the company behind the Home Improvement cards) a few weeks later. 

You can read the full story here: Bumps in the road.

Preparing to buy

Once Lowes’ fixed their computer glitch, I was ready to try again.  I still needed $1500 more of Lowes’ gift cards.  This time, when ordering the gift cards, I paid $4.99 per card for overnight delivery.  It was March 26th, and time was running out for my challenge.  When the cards arrived the next day, I now had about $5000 worth of Lowes’ gift cards.  Or so, I thought…

My plan had been to buy $5000 worth of Nest Learning Thermostats 2nd Generation.  These were top sellers on Amazon.com so I knew they would sell quickly.  With my 10% off movers coupon, I still would lose money on the whole deal (due to sales taxes and seller fees), but I had calculated that the loss was worth it given all of the points earned.

One big (and one little) break

On March 27th, I found that someone had posted several Lowes’ 10% off coupons on SlickDeals.  This was great for me because I really was thinking of moving and would have liked to use my movers coupon for that move.  So, I was able to use the SlickDeals coupon and keep my own for later.  That was my little break for the day.

The bigger bonus came when I browsed to Lowes and discovered that the Nest Learning Thermostat 1st Generation was on sale!  The sale price was lower than Amazon’s usual price, and so I calculated that I would lose much less on this deal than I would have with the Nest II.

Uh oh

I clicked through to Lowes from an online portal, and added $5000 worth of thermostats to my cart.  When I went to pay, I discovered a problem.  Four of my $500 Lowes’ gift cards couldn’t be applied to the order.  Something was wrong.

I called Lowes and learned that those four gift cards had been affected by the same computer glitch that had caused me trouble before.  But, unlike those orders, Lowes had sent me these gift cards as if everything was fine.  Once again, my Home Improvement gift cards had been re-credited, but I had long since thrown them away (I’ll never do that again!).

I repeated the earlier process of requesting the old receipt from Office Depot and emailing it to InComm.  As with the previous time, I asked for my refund as a check rather than replacement gift cards.  This check also arrived in a few weeks.

Final order

I ended up buying just $3000 worth of thermostats.  When they arrived, I sent them to Amazon for their fulfillment program and they sold out quickly.  I probably could have broken even or even made a profit by selling these through other channels, but I was happy to have the Lowes chapter behind me.

Learn about Million Mile Madness:

• A crazy million mile idea. Should I do it?
• Million Mile Madness, it’s on
• Million Mile Madness: Strategy
• Million Mile Madness: Preparing to buy & sell
• Million Mile Madness: Tracking points and expenses
• Million Mile Madness: The big churn story
• Million Mile Madness: buying, selling Kohl’s
• Million Mile Madness: Banking on Lowe’s
• Million Mile Madness: A setback from Sears
• Million Mile Madness: Pending Success
• Million Mile Madness: Bumps in the road
• Million Mile Madness: Credit scores and pulls
• Million Mile Madness: Easy points
• Million Mile Madness: Success!!!!!
• Million Mile Madness: Which points?
• Million Mile Madness: How it was done
• Million Mile Headaches: SunTrust

The pace of change in the miles & point world is staggering.  The most recent big change is with the latest and greatest way to earn 5X everywhere.  There was a special link to sign up for the Citi ThankYou Preferred card that offered 5X in drugstores, gas stations, and supermarkets.  That link now appears to be dead:

More than a week ago, at Frequent Traveler University, the theme of my presentation was change.  In that presentation, I highlighted the following developments in the 5X everywhere game:

• May 1 2012: I published “One card to rule them all.”  In that post I showed how to earn 5X Ultimate Rewards points everywhere credit cards are accepted.
• October 16th 2012: I published “Bluebird takes flight and changes the game.” In that post I showed how to earn 5X Ultimate Rewards points everywhere including billers that do not accept credit cards!
• November 10th 2012: I published “Office Depot discontinues Vanilla Reload cards.”  This change made 5X everywhere tough, but not impossible.
• February 3rd 2013: I published “Office Depot discontinues $500 Visa/Amex cards.”  5X everywhere was effectively dead.
• February 6th 2013 (just 3 days later), Personal Finance Digest published “The old Citi 5% gas/grocery/drugstore link is dead, here’s a new one.”  5X everywhere was alive again!!!
• April 6th 2013: Million Mile Secrets published “Breaking News: You Can Now Use Gift Cards For Cash Back, Loading Bluebird, and Buying Money Orders!“  Not only was 5X everywhere alive and well, but there were new ways to do it!

Now, just a month later, 5X everywhere with ThankYou points is effectively dead.  Those who got their cards in time can still enjoy 5X rewards for 12 months (unless they get shut down for perk abuse!).  Others will have to look to other opportunities.

For good or bad, change is coming.  And the game plays on…

This past weekend I went to D.C. for the Freddie Awards, the Travel Executive Summit, and Frequent Traveler University (FTU).  As always, I had an awesome time making new friends and catching up with old ones.  Activities and hallway conversations ran non-stop all weekend and I barely had enough time to kill a deal or two let alone write up any new content for this blog.

So, today I’ll simply spit out a number of miscellaneous items…

FTU Presentation past and future

I gave a presentation at FTU titled something like “You can still earn 5X everywhere”.  I’m not one to give the same presentation twice so this was very different from the presentations I gave last year at FTU LA, and at the Chicago Seminars.  I thought it went well.  People laughed at the right moments and seemed engaged throughout.  It was fun!

Photo courtesy of Kadence @ Iluvtravelfotos

Mileage Update generously tweeted:

@FrequentMiler Who knew you had a stand up routine as well?? Great speech at the #FTUDC

I’ll run a few posts in the near future to give readers an overview of my talk.  For those who’d like to meet up in person, I’ll also be at the Ann Arbor Art Fair DO in July (wait listed), at FTU Tampa in September (maybe speaking there – don’t know yet), and at the next Chicago Seminars (definitely speaking there) in October.

Staples: Save $15 when you buy $150 or more in MasterCard® gift cards after easy rebate

Valid through Saturday, May 4

You have to go into the store for this one.  Buy $150 or more of MasterCard gift cards (not Visa gift cards!) and you should qualify for a $15 Easy Rebate.  The rebate should print automatically along with your receipt.

Limit 1 rebate per household (no, I don’t know if this limit is easy to circumvent)

It should be possible to set PINs on these gift cards to use at Walmart, but I haven’t tried these yet and some people have reported issues with MasterCard gift cards and PINs, so as always, it may or may not work for you.

Hat Tip: Joshua

Staples: $10 off coupon

Valid through Saturday, May 4

UPDATE: The coupon is no longer working for gift card orders

This one is online only.  $10 off any order of $100 or more.  Seems to work with some items that you wouldn’t expect (see photo above for an idea of a related product).  Limited to one order per household.  Use coupon code 43994 at checkout.  Start your session from uPromise to possibly get 5% cash back.  Pay with a card that gets 5X at office supply stores (see “Best Category Bonuses“).

Here’s an example checkout receipt:

Hat Tip: Grant

Venmo ups limit to $3K

Hat Tip to Travelomania on FlyerTalk. This may be exciting news to those who have a debit card that earns rewards.  A friend reminded me that Venmo does not like people to swap payment sources too often so this is not a good option for draining gift cards.  I don’t use Venmo, nor do I have a rewards debit card (details coming in a future post) so I can’t really help you with details.

UPDATE: During the day, GiftCardMall changed the upper limit of their gift cards from $1000 to $500.  This can still be a money maker at 2%, but it’s not as good of a deal as it was.

Today only (Monday, April 29 2013), the cash back portal, TopCashback, is offering 2% cash back when buying gift cards after clicking through to GiftCardMall.  TopCashback usually offers 1.5% cash back for GiftCardMall, but the rate is going to dip down to 1% as of Thursday, May 2nd.  So, the expected cash back schedule for buying Visa gift cards at GiftCardMall via TopCashback is:

• Monday, April 29: 2% cash back
• Tuesday & Wednesday: 1.5% cash back
• Thursday and thereafter: 1% cash back

PINs

Now that Visa gift cards can be setup with PINs, they have become more interesting since they can now be loaded to Bluebird (see “Gift card PINs” and “Bluebird swipe reloads via ATM” and “Better than free manufactured spend“).

I’ve tested Visa gift cards from GiftCardMall and I found that, once activated, it is possible to simply use the last 4 digits of the gift card as its PIN (you can also set your own PIN online if you prefer).  Using the last 4 digits as the PIN, I successfully loaded my Bluebird card at Walmart.

Buy with Amex gift card

If you want to buy these gift cards with an Amex gift card, please read this post: How to use Amex gift cards to buy GiftCardMall gift cards and earn a profit.  Many questions you may have are (hopefully) already answered there.

TopCashback Notes

The following information was sent to me by TopCashback.  If you’re interested in their business model and how it affects promotions like these, here you go:

TCb makes money through the Google Ads that are dotted around its pages (and clearly marked as non-cashback earning) and by selling on-site advertising space to merchants. In the latter’s case, the merchant *must* also offer an increased rate of cashback – so members are gaining a little bit extra as well.

Cashback rates are always at least 100% (where allowed) of what TCb’s paid. If a cashback rate increases for a period of time, that’s either because a) the merchant has bought advertising space so has had to increase its cashback rate to be in line with the TCb advertising rules or b) there’s some spare TCb marketing budget that can be put towards offering members a higher rate of cashback with a particular merchant for a small period of time.

If a cashback rate decreases, it’s because c) TCb’s spare marketing budget has been removed from the rate; d) the advertising period for a merchant has finished, so the rate’s dropping back to its standard amount or e) the merchant has said it is lowering what it is prepared to pay TCb as standard. Nonetheless, regardless of which reason, the cashback rate displayed will be 100% of what TCb is paid.

Related posts and links

• Sign up for TopCashback: Sign-Up Links
• Read more:
  • How to use Amex gift cards to buy GiftCardMall gift cards and earn a profit
  • Learning Amex gift card rules the hard way
  • Better than free manufactured spend
  • Amex takes away $3K cash back gift cards
  • Gift card PINs
  • Bluebird swipe reloads via ATM

Last week I described the beginning of my quest to find the perfect Visa gift cards (see “The hunt for perfect gift cards, part 1“).  As a reminder, here are the characteristics of the “perfect” gift cards that I’m searching for:

• Low fee as a % of total value.  The ideal gift card would have a fee equal to, or less than, 1% or its maximum value.
• Ability to earn credit card category bonus points (see “Best Category Bonuses“).
• The ability to earn store reward points (such as fuel points) would be a big plus.
• Ability to set the card’s PIN quickly and easily.  I would like to be able to pickup the gift card at one store and then drive over to Walmart to load it to my Bluebird account with minimal fuss in between.
• High denomination.  Bluebird cards can be loaded up to $1000 per day (and $5000 per month) at Walmart.  If I’m going to visit Walmart anyway, I’d like to load the full $1000 each time.  The fewer gift cards it takes to do this, the better.  In other words, a $1000 gift card would be ideal (but I’ve never seen those in stores), and $500 gift cards are really good.  Cards with lower values are much less attractive.

In part 1, I visited Kroger, Speedway, OfficeMax, and Sears.  At that time I found that Visa gift cards from all four merchants worked fine to load Bluebird.  Overall, the gift card from Kroger was the best deal because I earned fuel points along with the purchase.  And, the OneVanilla card I bought at Speedway was the most convenient because it did not require a PIN to be set in advance.

In the comments of my previous post, a reader named Chris said:

I would like to add that you do NOT have to add a pin to the “Kroger” gift card. Just go to CS at Walmart give them your BB card and then swipe the card as debit, enter any pin and load. It sets up with the first pin too. It even asks if you want cash back!!

If that’s true, that would be huge.  Gift cards from Kroger would be both a fantastic deal and incredibly easy to use.  So, for the second part of this quest, I returned to Kroger to try this out.  I also bought $200 gift cards from Staples and Office Depot to see how those compared…

Kroger

I bought the same $500 U.S. Bank Visa gift card that I had bought before.  Again, I earned 500 fuel points for the purchase.

My goal was to see if I could use this card as a debit card at Walmart without first registering a PIN.  I went to Walmart’s MoneyCenter Express ATM (see “Bluebird swipe reloads via ATM“) to try to use the card to load $500 to my Bluebird card.  When it was time to enter my PIN, I made one up.  The machine tried to authorize the transaction, but it was denied.  I remembered that some gift cards use the last four digits of the card number as the default PIN so I tried again with those numbers, but once again the transaction was denied.  Ugh.  I then called Visa at 866-952-5653 to setup a PIN.  Once done, I tried again.  Again, the transaction was denied.  I then used my phone’s browser to register the card online.  And, I tried again.  Denied again.  Frustrated, I gave up on that card for the day.  I’ll try again this week.

Office Depot

My local Office Depot sells Vanilla Visa gift cards in denominations of $200 with a $6.95 fee.  I bought one and paid with a card that offers 5 points per dollar at office supply stores (see “Best Category Bonuses“). 

Since this was a Vanilla gift card sold by the same company as the OneVanilla card I had bought previously at Speedway, I thought that I would be able to use this card without first setting a PIN.  At Walmart, I went to the MoneyCenter Express ATM and attempted to load $200 using a PIN that I made up on the spot.  Success!

Staples

Just like Office Depot, Staples sells Visa gift cards in denominations as high as $200 with a $6.95 fee, but these are issued by MetaBank.  I bought one and paid with a card that offers 5 points per dollar at office supply stores (see “Best Category Bonuses“).

I wanted to see if this card could be used without setting a PIN in advance.  At Walmart’s MoneyCenter Express ATM I attempted to load $200 using a PIN that I made up on the spot. Denied.  I tried again, but this time I used the last four digits of the gift card’s 16 digit number.  Success!

Summary

My experiment to use the U.S. Bank gift card bought at Kroger without pre-setting a PIN was a failure, but I don’t know why.  Even after setting the PIN, I wasn’t able to use the card.  I’ll have to do more experiments with these cards to try to figure out what works and what doesn’t.  If you have experience with these cards, please let me know what you’ve found!

My experiments with gift cards from Office Depot and Staples were successful.  The gift card from Office Depot could be used with any made-up PIN (for the first time use), and the gift card from Staples could be used with the last four digits of the card number as the PIN. 

Let’s look at how the office supply store gift cards rate with each of my criteria:

Low Fee

$6.95 for a $200 gift card is definitely not a low fee at 3.48%.  $500 gift cards have fees close to 1%.  However, $100 gift cards generally have 6% fees, so these are right in the middle.

Category bonus

With the right credit/charge card (see “Best Category Bonuses“), 5X at office supply stores is the best category bonus available.  This goes a long way toward making up for the relatively high gift card fees.

Store Rewards

Neither Office Depot nor Staples give rewards for gift card purchases.

Easy PIN setup

It doesn’t get any easier than this.  No need to register a PIN with either card.  With the Office Depot card, use any PIN you want.  With the Staples card, use the last four digits of the card number.  If you forget which is which, simply always use the last four digits of the card number and you should be good to go.

High Denomination

These cards are in the middle of the pack again on this score.  They’re not nearly as convenient as $500 gift cards, but they’re twice as convenient as $100 gift cards.

Relative value of office supply gift cards

If you don’t mind dealing with $200 cards, then the main problem with the gift cards from Office Depot and Staples is their relatively high fee.  Suppose, though, you use some of the points earned to pay yourself back at one cent per point.  Would these cards still be a good deal?  Here’s the math:

• Buy $200 Visa gift card for $206.95
• Earn 5X:  5 X 206.95 = 1035 points
• Pay back fee with points: -695 points
• Points remaining: 340
• Points earned as a multiple of $200 spend: 1.7X

That’s pretty good!  This means that you can buy and liquidate Visa gift cards (through Bluebird) for free and still earn 1.7 points per dollar.  That’s a better earning rate than you would get from buying gift cards at a grocery store with most credit cards, but there are better deals (depending on how you value each type of point earned).  Here are a few examples:

• Earn 5X at grocery stores (and drug stores & gas stations) for the first year with the special Citi ThankYou Preferred offer.
• Earn 6% cash back at grocery stores with the American Express Blue Cash Preferred card (capped at $6K per year in spend).
• Earn 2X at grocery stores with the American Express Premier Rewards Gold card.  This is only a better deal than the office supply options if you earn fuel points for your purchases (as I did at Kroger).

Conclusion

I have more work to do to figure out what’s going on with the U.S. Bank card from Kroger, so there’s really no news right now on that front.  As to the $200 gift cards from Office Depot and Staples, I found that they are quite easy to work with, and a really solid way to earn extremely valuable points if you don’t mind dealing with their lower denominations.

What have you found that works well or that doesn’t work at all? Please comment below.

Today only (Monday, April 22 2013), the cash back portal, TopCashBack, is offering 2.5% cash back when buy gift cards after clicking through to “American Express Prepaid and Gift Cards”.  TopCashBack usually offers 1.5% cash back for American Express.  A competing cash back site, BigCrumbs, currently offers 1.4% cash back.

Note that TopCashBack will run a one day special for GiftCardMall a week from now (Monday, April 29).  On that day they will increase the GiftCardMall payout from 1.5% to 2%.  See “Better than free manufactured spend” for thoughts about how to leverage these promotions.

This post was written yesterday, so I didn’t have a way to capture a screenshot showing the temporary 2.5% cash back rate.  Instead, you will see below an expert artist rendering of what the screen may look like today:

Tips

• American Express gift cards (and prepaid cards) cannot be used as debit cards.
• Do not use Citibank cards to buy these gift cards as Citi is known to treat these purchases as cash advances (and will charge high fees).  If you are unsure whether your bank will treat these purchases as cash advances, you can protect yourself by calling and asking for your cash advance limit to be reduced to zero (some banks won’t allow it to go all the way to zero, but at least you should be able to lower it to less than you plan to pay online).
• Don’t go overboard.  If you buy tens of thousands of dollars of gift cards per month with one credit card, you are very likely to be targeted for a financial review.
• American Express has strict, but not clearly defined limits regarding how much you can buy per transaction.  See “Learning Amex gift card rules the hard way.”
• To pay less in fees for Amex gift cards, buy the cards shown in the top-left corner of the Amex Gift card page.  These cards can hold values up to $3000 each.  By going with larger value cards, the shipping and fees become a smaller percentage of the total.
• You may be able to find Amex discount codes online to save on shipping or to waive gift card fees.  TopCashBack, though, says “coupons that are not displayed on the TopCashback site, will nullify eligibility for cashback.”  So, it is safer to go without discount codes.
• You can order a customized gift card with your name on it, and a custom $ amount, by scrolling to the bottom of the Amex page and looking for the tiny link to “Gift Cards” (under the YouTube Icon).  See screenshots here: “Amex Gift Cards, this and that.”
• Don’t be surprised if it takes several months for cash back to become payable.  I bought a $3000 gift card through TopCashBack in January.  Within hours TopCashBack reported the transaction as pending (which was comforting), but 3 months went by before the cash back became payable.
• I can verify, from personal experience, that American Express does award miles / points when you use their credit cards to buy these gift cards.  That may change at any time, though.  So, go slow and check your statements regularly.