Please see the following updated post: Increase credit card spend (and get most of it back). What still works?
Signing up for credit cards is, by far, the easiest and quickest way to get huge numbers of points and miles. There is, though, a significant obstacle to this approach: Most big signup offers have big spend requirements. A typical offer, for example, requires $3,000 of spend within the first 3 months of card membership. Some spend requirements are much higher.
Whether your goal is to meet minimum spend requirements, or to earn a credit card big spend bonus, there are many techniques that can be used to increase credit card spend. Some of the following options result in getting all (or most) of your money back. Many options are ways to use credit cards to cover expenses that can’t normally be paid by credit card.
Pay and get your money back, with no net cost
- Load Serve with an Amex card. If it is issued by American Express, you won’t earn points but the load should still count as spend towards your minimum spend requirements. If it is an Amex card issued by a different bank, then you’ll earn rewards too. For more details, see: Complete guide to the many flavors of Serve. Which is Best?
- Fund a new bank account. When setting up a new bank account, many banks allow you to fund the initial deposit with a credit card. Doctor of Credit maintains a list of banks that allow this along with reports of which credit cards do or don’t charge cash advance fees for doing so. There are limits to how often you can do this, though, without causing problems. Some banks do a “hard pull” credit inquiry when opening new accounts, so that can have a negative effect on your credit score. And, most banks will check your ChexSystems report to see if there are any negative mentions (see Doctor of Credit’s post on ChexSystems, here). At a minimum, if you do this too often, you may be denied opening new accounts simply because you have too many recently opened accounts on your report.
- Buy fee free Visa/MasterCard gift cards. Fee free cards are not easy to find, but they do exist. Check local credit unions, for example, to see if they sell gift cards and ask how much they charge. AAA often offers fee free gift cards as well, but they’re pretty strict about limiting the total amount they’ll let you buy. Then there are the occasional sales. OfficeMax, for example, often has deals on gift cards where the discount more than offsets the gift card fees. Once you have these Visa/MasterCard gift cards, you can use them as debit cards to reload Bluebird or Serve at Walmart (but Vanilla Visa gift cards won’t work there).
Pay and get your money back, less fees
With the following options, you can use a credit card to pay and get your money back (less fees and expenses):
- Kiva loans: Estimated “fee” (loss due to defaults + cost to tie up money): 1.5%. Kiva does not charge fees for making loans via credit card, but you do risk losing money due to loan defaults. By sticking with “safe” loans, you can minimize this risk, but you can’t avoid it altogether. There is also a cost to tying up your money long-term since loans typically take 6 to 12 months to repay. For full details about manufacturing spend through Kiva loans, please see: Kiva: loans, points, and miles
- Credit card processing (e.g. Square Reader): Estimated fee: 2.75%. Several companies make it easy for small businesses to handle credit card payments. One very popular example is the Square Reader which charges 2.75% per swipe. Theoretically, you can set yourself up as a business and then manufacture spend through the credit card reader. BUT: Most services will shut down your account if they suspect that you are paying yourself. This approach is not recommended.
- Gift cards / reload cards: Estimated fee: .8% to 1.3% for $500 gift cards; 3.5% for $200 gift cards. It’s possible to buy Visa or MasterCard gift cards and use them as debit cards in ways that will result in getting your money back. Fees vary quite a bit both with regards to fees for buying gift cards, and fees for liquidating gift cards. See: Best options for buying Visa and MasterCard gift cards
A few services exist that let you pay friends with credit cards. In these situations it should be possible to manufacture spend by paying a friend and asking them to pay you back directly (with a check, for example). You could also set up a circle of friend payments: Person A pays Person B who pays Person C who pays Person A. Unfortunately, the fees for doing this are pretty steep:
- Paypal: 2.9% + 30 cents
- Venmo: 3%
A number of services let you use credit cards to pay bills that you might not otherwise be able to pay with a credit card (e.g. mortgage, rent, utilities, etc.).
Here are a few such services that offer a broad range of bill pay options:
- Plastiq: 2.5% fee. Amex, Visa, MasterCard
- TIO (formerly ChargeSmart): Fees vary. Amex, Visa, MasterCard, Discover
Then there are services specifically for paying rent:
- RadPad: 2.49% credit card processing fee; or $4.95 per payment by debit card.
- Many others. See: Doctor of Credit: Complete List Of Options For Paying Your Rent With A Debit Or Credit Card
And there are services for paying federal taxes (the IRS maintains a list here):
- PayUSAtax.com: 1.87%. Amex, MasterCard, Discover. 2.29% for Visa.
- ValueTaxPayment.com: 1.87%. Amex, MasterCard, Discover. 2.29% for Visa.
- OfficialPayments.com/fed: 2.35%. Amex, Visa, MasterCard, Discover
- ChoicePay.com/fed: 1.88%. Amex, Visa, MasterCard
- Pay1040.com: 1.87%. Amex, Visa, MasterCard, Discover
- Businesstaxpayment.com: 1.87%. Amex, Visa, MasterCard, Discover
Last updated on November 20th, 2016