Note: In response to a few readers’ questions, I’m going to spend a couple of days talking about manufactured spending. Today, I will discuss the Bluebird card, but turn to other (and possibly easier) methods tomorrow.
A couple of days ago, a reader asked about the best way to manufacture spend using the Bluebird cards. Manufacturing spend, for those not familiar with the term, is generating spending on your credit card solely for the points and ending up as close to zero dollars out of pocket. Huh? Here’s an example. A few years ago, the US Mint allowed you to buy dollar coins directly from the mint, using your credit card, with no fee. So you could buy, say, $5,000 worth of coins and, when they arrived, deposit those coins in your local bank and use that same cash to pay the credit card bill. Your net is zero dollars out of pocket, but you’ve earned 5,000 credit card points/miles for your time.
One of the most popular ways to manufacture spend is with the American Express Bluebird Card, which can best be described as a bank account on a debit card. You would deposit money, either by check or by reload (more on that later) and could use your account to get money at an ATM, pay bills, etc. One popular way to reload, or add money to, the card was with a card known as a “Vanilla Reload.” You could buy Vanilla Reloads at CVS for up to $500, with a $3.95 fee, and then type the numbers on the back of the VR into its proprietary site. The money would go directly to your Bluebird account and you could then get it out at an ATM, by paying a bill or simply by transferring the money to your own bank account. You could manufacture up to $5,000 in spend per month this way, meaning that you earned points at the cost of about 0.8 cents per point ($3.95 fee divided by the $503.95 you spent), which is not a bad rate of return, but not a great one, either. Many people, however, had cards that paid them 5% for drugstore purchases (See the post here.), meaning that they received $25 in rewards, which more than offset that $3.95 fee. Sadly, however, the ability to buy Vanilla Reloads with a credit card at CVS went away a few months ago, shutting down that particular avenue.
There is still one way to play the Bluebird, though, but it’s more complicated. It involves numerous trips to Walmart (Amex’s partner in the Bluebird venture) and possibly some frustration when you get there, so if you don’t live near a Walmart, this method may be more trouble than its worth.
It’s not well known, but most of the prepaid debit cards that you can buy at stores like CVS can be used instantly, just by establishing a PIN number on the card. Each card has a different method of establishing a PIN, so just read the instructions that come with the prepaid debit card. The easiest ones to use are the Vanilla prepaid debit cards that you can buy at CVS (You can still use a credit card to buy a prepaid card. You cannot use it to buy a “reload” card, which is a card that transfers funds onto yet another debit card, such as the Vanilla Reload described above. Bottom line: If you can use the card instantly, you can probably buy it with a credit card.). The Vanilla prepaid debit cards that you buy at CVS can then be taken to Walmart and loaded onto the Bluebird cards. You can do up to $1,000 per day and, if you’re lucky, your Walmart has a Money Center kiosk, which means that you can load the cards by yourself and not have to go through customer service. Here is an example of what the cards look like, courtesy of Google Images:
If it sounds like a lot of work, that’s because it is. But if you have a Walmart convenient to you and a 5% cash back card, you can make a couple of hundred dollars per month this way.Want to subscribe? Just enter your email in the box above (and to the right) and click on the confirmation. GMailers, check your Social or Promotions boxes!
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And finally, you can apply for credit cards through the Credit Cards for Charity link above. All card proceeds are donated to charity, so please do well by doing good!