The best way to Ink money (revised)

19

I’ve reported in the past that those with Chase Ink cards (the ones that give 5 points per dollar for office supplies) can profit from buying Visa gift cards at office supply stores. Recently I analyzed the difference between buying these gift cards online vs. in-store and I declared that online was better.  By shopping online through the Ultimate Rewards Mall to Staples, it is possible to earn even more points than the 5X given automatically.  You can read the original post here: “The best way to Ink money”.  Recently, though, the Ultimate Rewards Mall dropped the Staples bonus rate from 4X to 2X (or 3X for some lucky people) so it’s time to re-evaluate.

With each of the options for buying Visa gift cards, the value of paying the gift card fee in order to get extra points depends upon how highly you value those points.  Some people like to conservatively value Ultimate Rewards points at only 1 cent each since you can withdraw points from Chase as cash at exactly that rate.  Others (like me) use the Fair Trading Price of 1.31 cents each.  This is an estimate of how much it costs to buy Ultimate Rewards Points via credit card spend.  Still others prefer to look at the redemption value of Ultimate Rewards points.  Depending upon how the points are used, it is common to get at least 2 cents per point value from redemptions (using either an Ink Bold or Sapphire Preferred account – both of which have better redemption options than other Ultimate Rewards cards).

Analysis Table

The table shown here estimates the “X” for each option and each point value.  For example, If you have the Staples 3X option in the Ultimate Rewards Mall and you value points at 1.31 cents each, this table shows that buying $100 Visa gift cards online will give you the equivalent of 3.93X (points per dollar) for spend that you make with that Visa gift card.  In other words, while you start with 8 points per dollar in that scenario, just over 4 points per dollar are used to “pay you back” for the card’s $5.95 fee so you are left with 3.93X overall.

Gift Card Value

Fee

Points Earned

Value points 1 cent

Value points 1.31 cents

Value points 2 cents

Buy online through UR Mall 2X

$100

$5.95

742

1.47X

2.87X

4.44X

Buy online through UR Mall 3X

$100

$5.95

848

2.53X

3.93X

5.50X

Buy in-store

$200

$6.95

1035

1.70X

2.52X

3.44X

 

So, which approach is better?

In the table shown above, you can see that buying online is still the best bet in almost all cases.  The main exception is if you value points at only 1 cent and you only have the option of Staples’ 2X in the Ultimate Rewards Mall.  In that case, buying in store is better.

Still a great deal

The lowest multiple on the entire chart is 1.47X which is pretty good for ordinary purchases that would usually get you only 1X!  However, I think the 1.31 cent value is pretty conservative itself and with that value you get at least 2.5X regardless of which approach you use!

If you do not have a Chase Ink card, you can read more about those and other cards on the Preparing for Miles page which can be found as a menu item at the top of every page on the Frequent Miler blog.  Also, there is currently a public offer for 60,000 bonus points upon signup for the Ink Bold!  You can find details in this FlyerTalk thread. (60K deal has already been revoked).


Stay informed:
Follow me on Twitter / Like me on Facebook / Join the Club

If you’re new to Frequent Miler, please start here

Email:*
Please enter all required fields Click to hide
Correct invalid entries Click to hide
Subscribe
Notify of
guest

This site uses Akismet to reduce spam. Learn how your comment data is processed.

19 Comments
oldest
newest most voted
Inline Feedbacks
View all comments