Update: Note that Vanilla branded gift cards (like the ones pictured below) no longer work. Other Visas, like the ones sold at grocery stores and certain malls, do still work.
One of the most popular ways to manufacture spend (i.e. rack up a ton of miles/points cheaply) right now is by buying PIN-enabled gift cards and liquidating them by purchasing money orders. As I did previously with Vanilla Reloads and Bluebird, I’ll provide a step-by-step explanation of how to use gift cards and money orders in this post.
1. Buy a PIN-Enabled Prepaid Card
My favorite is One Vanilla, which can be found at CVS and other stores around the country. These cards can be loaded up to $500 for a fee of $4.95, or a dollar more than Vanilla Reloads cost. PINs do not need to be set beforehand with these cards.
Less useful but still useable are Vanilla Visa gift cards, which are sold at many grocery stores and at CVS. These can also be loaded up to $500 for the same $4.95 fee. You may have trouble with them at some places, so go for One Vanilla first if you can. PINs don’t need to be set beforehand with these either.
The two I mentioned above are best if you have some type of drugstore/grocery store category bonus. If you’re only earning 1x, there are other cards that will be better to buy. I’ll cover those in a later post.
2. Find a Store That Sells Money Orders and Allows Payment with a Debit Card
Everyone’s favorite is Walmart’s Money Center because they charge the lowest fees – just $.70 per money order. There are plenty of grocery chains and other places that sell money orders as well, but not allow allow debit cards as a form of payment. A friend of mine told me of a local grocery chain that sells them for $.75 each, but has a limit of just $500 each. I’m sure there are plenty of others that you can find as well.
The key here is to make sure that the total payment, including the fee, comes to a multiple of $500 so we can use our gift cards. For example, if you wanted to liquidate only one card at Walmart, you might ask for a money order totaling $499.30. With the $.70 fee on top of that, your total would come to an even $500.
You’ll be asked to swipe your debit card and enter your PIN, so swipe your prepaid card and enter any 4 digits as the PIN (I like 1234). The transaction should be approved and your money order will print out. You can discard your used prepaid card after this.
Once you get used to the process, you can do larger amounts using more cards. For example, you can ask for a money order for $999.30 and say you’d like to split it on two debit cards. At my local grocery chain I do $2K worth at once, splitting them on to 4 cards. My friend has done up to $3K and 6 cards. If you start going heavy on this, you’ll realize the luxury of being able to liquidate more cards in one shot, but be responsible about it.
3. Fill Out Your Money Order and Deposit it to Your Bank Account
Money Orders are guaranteed funds, similar to a cashier’s check. Write your name in the “Pay To…” line, sign the “Purchaser” line, and sign your name on the back as you would with any personal check. I’ve always written my own name in the “to” line and used my own signature in the purchaser lines.
Take your filled out money orders to your bank account and deposit them in your ATM or in person with the teller. Some ATMs can’t recognize the amounts and will ask you to manually enter the check total, which is simple enough to do. Your funds should be available to you the next day in nearly all cases.
4. Pay Off Your Credit Card As You Normally Would
At this point, the money is already back in your checking/savings account. You can pay off your credit card as you normally would, directly from your checking or savings account.
You’ve successfully manufactured spend!
- If you have Bluebird cards in hand, you can also load them using these cards to save yourself the money order fee. Take your Bluebird card to any Walmart register (doesn’t have to be Money Center) and ask to load $500 on your card. They’ll ask you to swipe your debit card and enter your PIN, and you’re done. I don’t believe you can split $1K on two cards like this, but most cashiers are happy to do two $500 transactions back-to-back. Bluebird limits loads to $1K a day and $5K a month.
- How many money orders is safe to deposit to your bank account? I don’t know the exact answer to that, but I spread them around as much as possible. I have four checking accounts and try to keep it roughly even. I wouldn’t deposit more than $5K or so in any one account at a time, but that doesn’t mean you can’t. It’s an arbitrary rule I set for myself and it’s what I feel comfortable with.
- Walmart Money Center machines can also print money orders and load Bluebird cards, but it’s rare to find them in working condition in my experience. If you do, you’ll quickly realize how awesome it is to not have to talk to anyone at Walmart!
- When you start using multiple cards and buying higher amounts, you may get funny looks. Some employees may ask if you’re using debit cards or prepaid cards. I find it useful to “ninja” it and show your real debit card to the cashier. Once they see the first one is real, they’re usually cool with the rest. I always hold my real debit card in case they ask to see the card.
- Build relationships. If you do this regularly, being friendly is your best bet to be able to do this continuously without being hassled.
- You’ll run into issues if you do this enough times. Sometimes your card wont activate properly, sometimes the cashier is pressing the wrong button, etc. In these situations, don’t push back, don’t get loud or upset. Just say “oh well, thanks for trying” to the cashier and figure out what happened later. Complaining about this will effectively burn a bridge with that cashier or store. You don’t want to do that.