This is the sixth post in a monthlong series that started here. Each post will take about two minutes to read and may include an action item that takes the reader another two minutes to complete. I am writing this for an audience of people who know nothing about frequent flier miles, and my goal is that by the end, you know enough to fly for free anywhere you want to go. Previously Increasing Credit Card Spending without Increasing Spending.
Yesterday I talked about how to increase the amount of money you spend each month on credit cards without increasing the amount of money you spend each month. The post was mostly tips about remembering to put almost all your expenses on a credit card instead of using cash or check.
This is key because the more money you spend on cards the more rewards you can get, since so many cards require a minimum spend before the sign up bonus is unlocked.
But there are other ways that I spend a lot of money on cards without increasing my total out of pocket costs by much. Four big ones are Amazon Payments, Bluebird, Gift Cards, and Kiva.
How can you supercharge your rewards on your budget?
Amazon Payments is a payment service very similar to PayPal with one major difference. Amazon Payments charges no fee to pay someone with a credit card. You can send $1,000 per month per account without fees on Amazon Payments. You can also receive $1,000 per month per account without fees.
Please read detailed analysis of using and not abusing Amazon Payments from FlyerTalk.
I have used Amazon Payments to send my part of the rent to a roommate. I get miles for sending the payment, and he writes a check to the landlord.
Since I left the US in February, Visa gift cards now allow you to add a PIN to the card. That means that you can buy a Visa gift card with a credit card anywhere they’re sold–the most convenient place I see them is grocery store checkout counters–add a PIN, and use the gift card anywhere you could use a normal debit/ATM card like ATMs and stores.
Here’s Frequent Miler with a full explanation.
I plan to buy Visa Gift Cards with my credit cards when I return to the United States.
Kiva is a charity that gives microloans to entrepreneurs in the developing world. Microcredit is awesome, and it’s a concept that I want to personally support. Kiva relies on “donations” to fund loans through intermediaries in the developing world.
I put “donations” in quotation marks because the idea is that the amount you give to Kiva and loan out will be returned to you (without interest) and that you can then withdraw that money again if you’d like.
Payments to Kiva must be made via PayPal. You can make the payment with a credit card, and there are no fees at least on the giver’s end. Withdrawals of repaid loans are also via PayPal and can then be withdrawn to a bank account again with no fees.
- load your Kiva account with a credit card
- make short term loans (Four-month repayment loans are widely available, and can be searched at kivalens.org.)
- make no concomitant donations to Kiva’s operating expenses
- get 100% repayment of your loans
- and withdraw all repayments to your bank account
you will earn miles at the opportunity cost of floating the money for a few months.
To be clear: I think that’s a very bad deal on its own. Unless you also support the mission, you shouldn’t do it just for the points.
I have personally loaned $3,100 through Kiva in the last few month, and have had about 1/3 of that amount paid back to me already with all of my loans paying on time. I chose to lend through Kiva because I believe in the concept also as a real way to pull individuals out of poverty.
You should not participate in Kiva
- until you fully understand it–this blurb does not suffice, see Kiva’s explanation for more
- unless you have sufficient money to float
- unless you also support the mission
If you do participate, you won’t be the only person in the miles-and-points community. The third biggest Kiva lending team of all time is the milepoint team with $5.5 million dollars loaned.
I’ve covered Bluebird fully here. I think Bluebird is a bit more complicated than Visa gift cards at the moment. But Bluebird has some really cool features like getting a check book with your account and online bill pay.
This is a beginners’ series, so I want to make you aware of some ways that others are using to put more of their spending on their credit cards that you might not have thought of on your own.
This is not an exhaustive explanation of any of these methods. All of them are complicated and could carry some risk. Investigate them fully–starting with a google search–before deciding whether you want to do any of the things mentioned here.
You can earn millions of points without the ideas in this post, and you can fly to exotic destinations in First Class without them too.
Pretty soon we’ll put it all together and see why we want to put more spending on credit cards when I reveal the current best credit card offers in the next few days that will dramatically increase your travel while dramatically decreasing its price.