Recently, with offers like the AMEX Platinum 100,000-signup bonus, Citi ThankYou Premier 60,000-signup bonus, and AMEX SPG 30,000-signup bonus dropping one after another, many people have opened multiple cards and now have a lot of opening-spend requirements to complete. Here, I’ll introduce a few ways to do manufactured spending and work through a large amount of opening spend.
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Everyday spending
Start with the simplest method. Move all bills you can pay by credit card to autopay and use the card you need for the signup-spend requirement. It’s basic, but a lot of people still forget it. More importantly, some bills can be prepaid. For example, insurance and phone bills: you can prepay a year of insurance (usually cancellable with an unused balance refundable at any time) or several months of phone service.
Buying for others
If you happen to be going back home, or if classmates don’t have a credit card, this is a good way to let them use your card for purchases.
Medical appointments
You can even move up your dentist appointment. Most medical practices accept credit cards (no surprise).
Stock up on gift cards
Buy gift cards for grocery stores and restaurants that you can realistically use later.
Fund the first deposit of a checking account
At some banks (like Citi), the first funding of a new checking account can be done with a credit card. Limits vary by bank. Usually, banks process it through their own POS, so this funding can possibly be counted as a purchase by the card issuer. A well-known card issuer for this method is Barclaycard. Before doing it, check the data points, set the cash advance limit of the card you plan to use to $0, and monitor your card statement often to ensure funding is not posted as a cash advance.
Through Visa gift cards
The idea is actually simple. Use a card to buy a Visa gift card, then find a way to load the balance into a reloadable prepaid card account (introduced below), and take money out via Billpay/ATM withdrawals or check-writing (strongly not recommended; this can lead to account closure). Once the cash is cycled back, your card’s opening-spend requirement is met. Keep in mind AMEX has recently become more sensitive to this MS method. Don’t use this approach to complete Amex card opening spend.
Step 1: Buy a Visa gift card
First, find a place that sells Visa gift cards and accepts credit cards. Important: not every Visa gift card works. Here are some datapoints shared by helpful readers:
- Simon Mall Visa gift cards: usable
- Walmart Sunshine Visa gift cards: usable
- US Bank/Metabank-issued Visa gift cards: usable
- Staples Visa gift cards: usable
- Vanilla brand Visa gift cards: not usable
If you want to know whether the Visa gift card you saw is usable, Google it first, or buy a lower value test card.
Load to a reloadable prepaid card or buy a money order
The second step is the hardest and riskiest, and it’s where using one of the 4 cards below to load Visa gift cards is most commonly done, because this transaction pattern is farther from how AMEX originally intended these cards to be used.
2016: Note that a large number of Serve and Bluebird accounts were restricted by AMEX. It’s still unclear where AMEX’s line is, so hold off on using them for now until further updates.
- Netspend: Visa gift cards can be loaded online, and funds can be ACH Pulled from the account to other banks, but accounts loaded with Visa gift cards are easy to close, so withdraw the money as soon as you receive it. Even if the account is closed, the balance is still mailed back by check, so there is no loss. (Update: Netspend now limits online Visa gift-card loads to $100 per transaction and $250 per day, and charges $1.95 per transfer. Because the fee is high, it’s still better to use AMEX’s bird cards for MS.)
For the actual load process, go to a supermarket (Walmart or Family Dollar for Serve and Bluebird; Target for Redbird), then go to customer service (or Walmart Money Center) and ask the clerk to reload the card. If asked what you’re using, clearly state it is a debit card (Visa gift cards are clearly labeled as debit). If you’re lucky, the clerk will load the Visa gift card; if not, don’t push too hard—switch stores or try again later. Remember each card has a daily load limit, and some load machines have their own trigger points, so don’t do too much at once.
If you’re lucky enough to have a MoneyCenter Express nearby (sometimes called an auto-reload kiosk), reloading is much easier. Any Visa gift card with a PIN can be used to reload. When using the machine to reload a bird card, the kiosk can get quite loud, so bring headphones and plug in to avoid drawing attention. Example of the kiosk:
These 3 cards can be used via Billpay to pay rent, loan payments, and other bills that usually can’t be paid by credit card. You can also pay Billpay to a friend and then transfer funds back, effectively cashing out and completing the manufactured-spending loop.
You can also buy money orders with Visa gift cards at Walmart or other supermarkets. Walmart Money Center charges only $0.70 per Money order, with a maximum of $1,000. So in theory you could use two $500 Visa gift cards to buy one $999.30 money order, then use split payment from both Visa gift cards to cover the $1,000. In practice, it’s recommended to purchase smaller-value Visa gift cards, such as $400-$450, to avoid triggering suspicion from card issuers.
AMEX card: AMEX Serve
For AMEX credit cards and charge cards, using AMEX Serve is a relatively simple option. You don’t need the hassle of buying Visa gift cards above—you can simply load AMEX Serve online directly from your AMEX card. You won’t earn any rewards, but it still counts as spend.
Paying bills with Plastiq/Radpad
This is not very cost-effective, but you can use Plastiq to pay almost any bill with a 2.5% fee, such as rent, student loans, and tuition. Radpad can also pay rent via Mastercard with a 2% fee. Compared with the methods above, this is easier, but the cost is much higher.
Conclusion
I think the Visa gift card method for manufactured spending has become very painful and risky, so I don’t recommend it unless necessary. Of course, even if you can’t successfully reload, you can still keep and slowly spend down the Visa gift cards over time. It’s best to have a plan before applying for cards on how to clear your opening-spend requirement, so you’re not pressured into random spending. Most manufactured spending comes with some level of opportunity cost. Think it through first.
Do you have any manufactured-spending experiences? Leave a comment and share them.