- Newbie Guide to Manufactured Spending: FAQ
- Newbie Guide to Manufactured Spending: Prepaid Cards and How to Cash them Out
- Newbie Guide to Manufactured Spending: Vanilla Reload Cards
- Newbie Guide to Manufactured Spending: Paypal My Cash Reload Card
- Newbie Guide to Manufactured Spending: REloadit Cards
- Newbie Guide to Manufactured Spending: Green Dot MoneyPak
All of the cards we’ve discussed so far involved a three-step process: You buy a reload card, load it onto a prepaid card, then cash out via various methods. There is an easier and more lucrative option: Visa and MasterCard gift cards.
Many gift cards are now PIN-enabled and make it possible to use at an ATM or cash-back at grocery stores. These gift cards can be purchased in $500 increments and have fees ranging from $3.95-$6.95. To eliminate part of the fee, you can purchase these online through select shopping portals and earn cash back.
Purchasing Visa and MasterCard gift cards are becoming one of my favorite manufactured spending due to the following advantages:
1. No purchase limit. You can buy as many of these as you want. The only thing to take into account is whether you have the time to unload them all.
2. Easy unloading. Most Visa and MasterCard gift cards are PIN enabled, making them easy to cash out via cash back at the grocery store register, money order purchases, Amazon Payments – pretty much any way a debit card could be used. All of the cash-out methods are either free or fairly cheap.
In addition to unloading them via Amazon Payments and money orders, you can also load them onto Bluebird. This can be done at any Walmart register or the Bluebird ATM (make sure you select “Prepaid Card” if “Bluebird” isn’t an option). You can then use Bluebird’s Bill Pay center to pay your credit cards and other bills.
Keep in mind that just because a gift card has a Visa logo on it, that does not mean it’s PIN enabled. Walmart, for example, has a range of Visa gift cards that do not come with PIN numbers. Gift cards issued by Bancorp, US Bank, and MetaBank are usually PIN enabled.
3. Category bonus potential. You can buy Visa and MasterCard gift cards at grocery stores, office supply stores, and drug stores – all of which are lucrative category bonus merchants. These cards don’t come in very large denominations (mostly in increments of $500 or less, especially at office supply stores), but the bonus points paid out by credit card issuers often makes it worthwhile.
4. Free manufactured spending. Fees vary depending on the card and the denominations you’re purchasing them in. Usually, they don’t exceed $6.95 for a $200 MasterCard gift card (which earns 1,000 points at office supply stores with an Ink Bold card – less than the cost of buying Vanilla Reloads). What decreases the cost significantly are promotions that often eliminate the purchase fees and sometimes even makes buying these cards profitable.
Office Max, for example, often runs promotions on their MasterCard gift cards. The most recent one was for $20 off a $300 gift card purchase. The largest denominations they carried were $100, which came with a $5.95 fee. The fees came up to $17.85, but with the $20 discount, I pocketed $2.15 (I know, I won’t quit my day job). The significant part of this promotion isn’t the change you pick up as a result, it’s that you’re earning miles without any fees. With my Ink Bold card, I earned 1,500 Ultimate Rewards points. That’s not enough for a trip anywhere, but if I do this two more times, it’s enough for a one-way short-haul flight (using 4,500 British Airways Avios). You can unload these cards using the methods outlined above, or simply use them to pay your bills.
Another option is to buy Visa gift cards through Giftcardmall.com by going through a shopping portal like TopCashBack or Extrabux. Currently, the payout on Visa gift cards is just 0.5% at TCB and 1% at Extrabux. Factoring in various fees and shipping, the cost of purchasing and liquidating these cards at 0.5% is roughly the same as with Vanilla Reloads. At 1%, you can make a small profit if you consolidate your shipping cost by placing a large order. I would keep an eye out as TCB had a pretty good promotion a while back that made purchasing gift cards profitable. [Update 4/9: Extrabux is no longer offering cash back on Visa gift cards.]
As you can see, Visa and MasterCard gift cards can be great manufactured spending tools. Not only is there unlimited earning potential, but you can also make a profit with this method.
Note: I will earn a $10 referral fee if you register using the TopCashBack link in this post, along with $5 from Extrabux after your first purchase. Extrabux pays out additional commission when users who signed up with my link use the portal. Please feel free to include your own referral links in the comment section.