The Money Mustache Community
Learning, Sharing, and Teaching => Ask a Mustachian => Topic started by: Stache In Training on November 14, 2013, 10:01:01 PM
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So I'm curious if anyone has tried this: Have a credit card with the revolving categories of extra rewards. Such as for April and May, you get 5% cash back at grocery stores. However, then grocery stores sell gift cards, even visa gift cards. So buy a few then, get the 5% cash back on that, and then use them at the grocery store when you're not getting the bonus % back. Then June and July, say the bonus is at drug stores. so then you buy a few gift cards there, and then use the gift cards elsewhere. Essentially, you could get 5% cash back on every purchase.
Does this work? Do the gift cards qualify in the bonus?
I just have a card that just gives 1.5% back on everything, which I liked, because when you're not getting the bonus (also there's a limit on the bonus), it's only 1% or less, usually. But if I can buy the limit at drug stores in one promotion (which I hardly ever shop at) and apply it, via the gift cards, to my groceries when they are not on promotion, that would be awesome!
So anyone do this yet?
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Target gives you 5% off all the time if you use your target card.
They also have gift cards for a number of restaurants and stores:
AMC, Apple, Facebook, Groupon, iTunes, Regal Cinemas, Restaurants (Applebees, Bahama Breeze/Longhorn/Olive Garden/Red Lobster/Season 52, Buffalo Wild Wings, Chick Fila, Chilis/Macaroni Grill/Maggianos/On The Border, Cracker Barrel, iHop, PF Chang's, Starbucks, Subway)
And you get 5% off those gift cards.
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Greenbeard, first off: Awesome beard!!
Now to the matter at hand. Is that 5% at target only, or on all purchases? Also, isn't it true that the rewards can only be used/spent at target? Because if so, then that is not very useful, 1, because I don't have a target in my town, and 2, I would shop at more than just target even if it were available (maybe not a super target, depending on the prices).
Also, those gift cards are very specific, and as a good mustachian, I'm really never at those restaurants and stores, 1, again because only two of them are even in my town, and 2, because they are very anti-mustachian, in nature.
So I'm talking about buying a visa or mastercard gift-card from a grocery store, while the grocery store has a bonus offered by my credit card company. Does that work?
Now, if target sells visa gift cards too, and the 5% cash back does not have to be spent at Target, then yes, it may be worth it to go buy $1,000 in visa or mastercard gift cards on a target card, whenever I'm visiting a town with a target.
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It's 5% off purchases at Target when using the Target card at the time of purchase. Not points.
But you can buy any of these third party gift cards and get 5% off their face value:
http://www.target.com/c/specialty-gift-cards-giftcards/-/N-5xsxs
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I agree the first list I provided are not very mustachian but I checked the Target site and there are some useful third party cards, like cell phone cards and southwest airline cards.
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Yeah, so that won't work since I don't have a target in my town. It might have, but it doesn't look like you can buy visa or mastercard gift cards.
So here's probably the card I'd use if this can work: https://www304.americanexpress.com/credit-card/compare/blue-cash/28000 (https://www304.americanexpress.com/credit-card/compare/blue-cash/28000). The preferred one. Though the everyday could work too, if you hate the annual fee, it's just 3% instead of 6%. So does anyone know if buying visa or mastercard gift cards from safeway, would qualify in the 6% cash back program?
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Around here, there are fees to buy MC/VS cards (but not regular gift cards). Check the fine print.
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Yeah, so that won't work since I don't have a target in my town. It might have, but it doesn't look like you can buy visa or mastercard gift cards.
So here's probably the card I'd use if this can work: https://www304.americanexpress.com/credit-card/compare/blue-cash/28000 (https://www304.americanexpress.com/credit-card/compare/blue-cash/28000). The preferred one. Though the everyday could work too, if you hate the annual fee, it's just 3% instead of 6%. So does anyone know if buying visa or mastercard gift cards from safeway, would qualify in the 6% cash back program?
Yes, it works. I've been doing it since the BCP card came out in 2011. Link to old thread (https://forum.mrmoneymustache.com/share-your-badassity/mustache-that-american-express-card-into-a-mini-money-maker!/msg70511/#msg70511). Oh, and for anyone who hasn't done the math, the Preferred card is a much better deal after spending $2,500 in a year on groceries. The unfortunate thing is the $6,000 cap on grocery purchases. I had the card for 18 months before the cap. That was nice.
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I recently signed up for the Sallie Mae Rewards Credit Card (https://www.salliemae.com/landing/WorldCreditCard/). It pays back 5% cash back on gas and groceries all the time (on the first $250/month in spending in each category). If you tend to spend less than $250/month on groceries it pays out better than the AmEx Blue Cash Preferred card because the Sallie Mae card has no annual fee and only 1% lower reward level. I encourage you to check it out.
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I recently signed up for the Sallie Mae Rewards Credit Card (https://www.salliemae.com/landing/WorldCreditCard/). It pays back 5% cash back on gas and groceries all the time (on the first $250/month in spending in each category). If you tend to spend less than $250/month on groceries it pays out better than the AmEx Blue Cash Preferred card because the Sallie Mae card has no annual fee and only 1% lower reward level. I encourage you to check it out.
Non-starter for me. I'd rather get $285 back on $6,000 in grocery spending (which isn't hard, especially when doing what the OP is asking about) than $150 back on just $3,000 per year.
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To each their own. My grocery spending is much closer to $3k/year than $6k/year and I rarely shop at the retailers that Safeway sells gift cards for, so the Sallie Mae card is a much better deal for me. If that's not the case for you, then the AmEx makes more sense.
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To each their own. My grocery spending is much closer to $3k/year than $6k/year and I rarely shop at the retailers that Safeway sells gift cards for, so the Sallie Mae card is a much better deal for me. If that's not the case for you, then the AmEx makes more sense.
OP was asking about the Visa/MC/Amex (good for Costco runs!) variable-load gift cards sold at grocery stores. It's very easy to use those to shift a lot of spending to the "grocery" bucket and meet the $6,000 cap.
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To each their own. My grocery spending is much closer to $3k/year than $6k/year and I rarely shop at the retailers that Safeway sells gift cards for, so the Sallie Mae card is a much better deal for me. If that's not the case for you, then the AmEx makes more sense.
OP was asking about the Visa/MC/Amex (good for Costco runs!) variable-load gift cards sold at grocery stores. It's very easy to use those to shift a lot of spending to the "grocery" bucket and meet the $6,000 cap.
Exactly. I'm not looking to change cards because I spend a lot on groceries or gas or anything specific category, but rather, if the Visa/MC/Amex variable-load gift cards sold at grocery stores, counted towards the bonus cash back? Because if so, since I spend less than 6k a year on groceries, then I can buy the balance in visa gift cards, and essentially get 6% cash back on anything else.
So anyone know if it works?
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So anyone know if it works?
I already answered this above, in reply #7. It works.
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Oh, sorry, I thought you meant for the target card. I miss-read that.
What about the 18 months? I thought the cap was on a per year basis. Or are you just saying that you did in fact come in under the cap?
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Not all grocery stores will allow purchase of Visa/MC/Amex gift cards. Ralph's (part of Kroger) won't let me, for example. Cash only.
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Oh, sorry, I thought you meant for the target card. I miss-read that.
What about the 18 months? I thought the cap was on a per year basis. Or are you just saying that you did in fact come in under the cap?
Yes, the cap is per year. I originally got the card in June 2011. The cap did not start for me until my January 2013 statement, so I had 18 months with no cap on grocery spending. Amex shows your annual category spending (one month behind) online, which is handy.
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Not all grocery stores will allow purchase of Visa/MC/Amex gift cards. Ralph's (part of Kroger) won't let me, for example. Cash only.
This is true, but it also depends on the local manager. Kroger and Randalls both allow gift cards to be purchased with credit cards in my area, but HEB has gone to cash or debit only.
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Not all grocery stores will allow purchase of Visa/MC/Amex gift cards. Ralph's (part of Kroger) won't let me, for example. Cash only.
This is true, but it also depends on the local manager. Kroger and Randalls both allow gift cards to be purchased with credit cards in my area, but HEB has gone to cash or debit only.
Good to know. I'll experiment with different locations.
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Just food for thought:
DW and I spent some time figuring out how to maximize credit card rewards, got the BCP card and a Capital One Venture Card, which is basically 2% on everything. Those and a 5% rotating category Chase Freedom card round out the set.
I started to do some scheming about how we might get gift cards at Safeway to cover other expenses and thus max out the 6%. But I also realized that bending over backwards to max out rewards and game the system is kind of counter to my values. Biking to work, living more simply, minimizing food waste, using less power... these things are good for me and society. Maxing CC rewards doesn't really add any value to the world or prevent any waste.
So that's just to say, I set them up the CC rewards in the best way I could find, and then I don't worry about it too much anymore.
But DW's mother will want a Starbuck's gift card for her birthday, and that will still be bought at Safeway for only 94% of its face value. :)