Top 3 ways to earn uncapped profit buying Visa gift cards

59

Money Tree

The points & miles game is, to many of us, a series of fun and challenging puzzles.  We first figure out how to earn the most points & miles for the least cost and effort, and then we figure out how to get the most value with those points and miles (see: The games we play).  While I usually write about points & miles techniques, it’s not lost on me that many of the same techniques can be used to earn cash back.

One technique that works well for cash back is buying and liquidating Visa/Mastercard gift cards.  It’s possible to earn a profit with these transactions, and you won’t receive 1099 tax forms.  This post looks only at the buy side of the equation: how to earn the most profit with each gift card purchase.  How to liquidate gift cards is not covered here.  While some liquidation techniques are covered in our Manufactured Spending Complete Guide, most techniques vary by location. To learn how to liquidate gift cards, your best bet is to try to find others in your area who are willing to help.

It’s often possible to earn high cash back rates through limited credit card bonuses.  For example, a number of credit cards offer very high rewards on grocery spend but only up to $6K spend per year (or up to $25K per year with the Amex Gold card).  Similarly, a number of cards offer 5% back in various categories of spend, but only on up to $1500 or $2500 spend per quarter.  This post is not about those limited deals.

Manufacturing Spend Caution: Many, many things can go wrong when manufacturing spend. If you suddenly increase credit card spend, your accounts may get shut down. If you cycle your balance often (e.g. spend to your limit, pay the bill, repeat) within a billing cycle, your accounts may get shut down. If you repeatedly pay your credit card bill from an anonymous bill payment source, your accounts may get shut down. If you buy lots of gift cards you may lose money due to gift card fraud, theft, loss, or simply mishandling those gift cards (e.g. maybe you thought you already used a gift card and tossed it into your “used” bin). If you rely on only one method to liquidate gift cards, you may be stuck unable to pay your credit card bill when that method gets shut down. In other words, don’t try this at home unless you know what you’re doing, and you understand and accept the risks..

This post is about (mostly) uncapped cash back rewards opportunities when buying Visa or Mastercard gift cards. In a future post I’ll similarly look at the best uncapped points & miles options.

Here are the options I’ve identified that offer the biggest potential cash profits:

#3: Gift Card Mall + Ebates + Ebates Visa

($14.05 profit* per card)

Gift Card Mall offers $500 Visa gift cards online with a $5.95 fee per card and free USPS shipping on orders under $2,000 (inclusive of fees) or $10.95 per order (or more depending upon which shipping option you choose) for larger orders.

Even better, you can earn 1% cash back by clicking through the Ebates cash back portal to Gift Card Mall.  By ordering 3 or fewer $500 gift cards at a time this way (with free shipping), your cost per card after the portal rebate is only 95 cents.  That’s a mere 0.19% of the card’s $500 value.

Profit comes into play when you use a credit card that earns better than 0.19% in rewards (i.e. almost any rewards card out there).  The best card for this purchase is probably the Ebates Cash Back Visa which earns 3% cash back on qualified purchases made through the Ebates portal.

By buying gift cards with no shipping fee at Gift Card Mall after clicking through the Ebates cash back portal, you’ll spend $5.95 in fees for each card, but you’ll get back $5 per card from the portal and $15 from the credit card.

Example Purchase: $500 Visa gift card with $5.95 fee

  • Click through Ebates to Gift Card Mall for 1% cash back ($5)
  • Pay with Ebates Visa for 3% back ($15)

Profit* per card: $20 – $5.95 = $14.05 (not counting the cost to liquidate cards)

Limits: $1,686 profit* per month per person (portal rebates are limited to $60K spend per month: 120 $500 cards).

Credit card fees: None

* “Profit” does not account for cost to liquidate cards

#2 Gift Card Mall + Ebates MR + Ebates Visa + Schwab Platinum

($19.05 profit* per card)

Now that you can earn Membership Rewards points instead of cash back from Ebates, there’s another play here.  The Amex Platinum Card from Schwab lets you cash out points at 1.25 cents each.

Example Purchase: $500 Visa gift card with $5.95 fee

  • Click through Ebates (Membership Rewards version) to Gift Card Mall for 1X Membership Rewards
    (500 Membership Rewards)
  • Pay with Ebates Visa for 3X Membership Rewards (1500 Membership Rewards)
  • Via Schwab Platinum, cash out 2000 Membership Rewards points for $25

Profit* per card: $25 – $5.95 = $19.05

Limits: $2,286 profit* per month per person (portal rebates are limited to $60K spend per month: 120 $500 cards).

Credit card fees: $550 per year

* “Profit” does not account for cost to liquidate cards

#1 Gas Stations + Ducks Unlimited

($19.35 profit* per card)

If you’re lucky enough to find a gas station (or a numerically named convenience store) that sells Visa or Mastercard gift cards loadable up to $500 each, and that’s willing to let you pay with a credit card, you’re in luck.  Many credit cards that offer bonuses for gas purchases are limited to “pay at the pump” transactions.  Fortunately, the Ducks Unlimited Visa card does not have that restriction.  With the Ducks card, you get 5% back on all gas station purchases.

Most Visa or Mastercard gift cards loadable to $500 include a $5.95 fee.  With the Ducks card, you’ll get 5% back on the full $505.95 charge.

Example Purchase: $500 Visa or Mastercard gift card with $5.95 fee

  • Pay with Ducks Visa for 5% back (5% of $505.95 = $25.30)

Profit* per card: $25.30 – $5.95 = $19.35

Pump up the profit: It may be possible to increase profits with a card linked offer for your local gas station convenience store.

Limits: Some gas station convenience stores have limits on how much you can spend at once on gift cards

Credit card fees: None

Alternate approach: The Amex Business Gold Card offers up to 4X at US gas stations. When paired with the Schwab Platinum, this combination earns 5% cash back at US gas stations on up to $150K in purchases per year.

* “Profit” does not account for cost to liquidate cards

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