Hopefully you’ve opened up an American Express SPG Business account (or two) by now and have switched all of your spending to these cards to meet the $8,000 requirement in 6 months.  But what if you think you are going to come up short on the $8,000 spend requirement or would like to accelerate your spending so you open another credit card for the spending bonus – a lot of travel hacking folks manufacture spend.

What exactly is manufactured spend?

It’s purchasing something (with your favorite credit card) that can be converted back into cash.

Here is an example: Back in 2008, the US Mint introduced dollar coins into circulation and to tried to make them widely used.  To do this, they had an offer where you could purchase the dollar coins with a credit card and have the coins shipped free to you with no additional fees.  So if you purchased 1o00 dollar coins – you could use a credit card and would only be charged $1000.  After you received the coins, you’d take them to your bank and deposit them.  This lasted for about 3 years before getting shut down.  Travel hackers were going crazy purchasing these,  here is an article all about it – it even mentions someone who purchased over $2,400,000 worth – now that’s a lot of miles!

I’m going to share a way I occasionally manufacture spend using Visa gift cards bought at a supermarket with no out of pocket cost.

Grocery Store Visa Gift Cards

Step 1: Purchase Variable Visa Gift Cards at Weis Supermarkets with your favorite credit card.  I purchased a ton of these in 2014, then Weis changed their policy to be ‘cash only’ for visa/mastercard gift cards.  But it looks like they’ve changed their policy back to allow the purchase of Visa gift cards with a credit card.  Below is a sign at their store.  I always purchase the variable load (up to $500) Visa gift cards by MetaBank.  The cost is 5.95.  Obviously your mileage will vary depending on where you are located and the availability of grocery stores that will allow the purchase of gift cards with a credit card.  Weis has 204 stores in PA, MD, NJ, & NY.

Example – two $500 cards + $5.95 fee = $1011.90 total

Step 2: Go to Walmart and purchase a money order in the amount of $999.30.  The money order fee is 70 cents, so the total will be $1000 even.  Use the two Visa gift cards you purchased at Weis for payment.  You will have to tell the employee that you are ‘splitting the payment with two debit cards’.  Swipe your first visa gift card, hit the debit button when it comes up, and enter the PIN (which is the last 4 digits of the gift card # for MetaBank gift cards).  The employee will have to type in the amount you tell them, $500.  Then swipe the next Visa gift card, hitting debit, and typing in the PIN.  The employee will give you the money order and a receipt.

Step 3: Fill out the money order and deposit the money order into a bank.

Step 4: Use the bank’s bill pay to make payments to credit cards, utilities, etc.

Step 5:  You might be asking me how to recoup all of the fees ($11.90 in visa gift card fees + 70 cents for the money order).  Well the reason I like to purchase at Weis is that they provide you with fuel rewards.  In my area, they partner with Sheetz Gas Stations.  For every $50 of gift cards you purchase, you earn 10 cents off per gallon of gas.  In our example, we purchased $1011.90 cents – so we are receiving $2.00 off per gallon of gas ($1000/50 = 20 x 10 cents = $2.00).  There is a limit of 20 gallons in one transaction.  My vehicle only holds about 15 gallons – so to maximize value, wait until you are very close to empty and fill up then.  $2.00 savings x 15 gallons tank capacity = $30 in savings which more than offsets the $12.60 cents in fees that were incurred.  You can stretch this to $40 if you are able to use the full 20 gallons.



Words of Caution

  • American Express has been known to clawback rewards if they suspect people have been manufacture spending for signup bonuses.   So I would recommend using the card for everyday spending and mix in a few gift cards here and there.
  • Each store varies, but you will most likely need a manager override if you purchase more than one $500 gift card – be ready to show them your ID and credit card you are using (they are trying to prevent fraud).  I usually take the cards to purchase at customer service area since a manager is usually already there.
  • Don’t forget to have them scan your rewards card to get the gas points – the bottom of your receipt will have the amount of gas points you have the expiration date (usually 6 week periods).  I had so many gas points that were expiring from doing this, one day I filled up 3 different people’s cars at the gas station for free.  They were happy!
  • There are also stories of banks shutting down accounts because too many money orders have been deposited.  I would not use my everyday checking account for depositing money orders.  I would suggest opening a new separate account at a local bank/credit union or an online bank like the one I mentioned above.

3/5/2017 Update – Giant

I was in Giant grocery store today and they also allow you to purchase Visa gift cards with a credit card.  They even have a promotion going on this week specifically earning double gas reward points for Visa gift card purchases.