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I’m a bit of a reluctant participant in the world of prepaids. I always have been, and at this point I presume I always will be. I don’t like the hassle of getting them, I don’t like keeping up with them, I don’t like being looked at like I’m a degenerate or up to something sneaky when I’m rummaging around the gift card rack, I don’t like Walmart, and I don’t like the risk of there being fraud holds or similar on my cards. I have worked hard to have good credit and good credit cards with at least decent customer service and I would rather use them than some rinky dink prepaid card.
So why bother then? Well, because it can be a good way to rack up some extra miles and points for things that you either normally wouldn’t earn points on at all (such as paying a student loan), or to capitalize on buying gift cards at places that earn a category bonus on your credit cards (drug stores, grocery stores, office supply stores, etc). At the very least I don’t want to be ignorant to this constantly evolving method of earning points. So, it was time for me to get some first hand experience with the next evolution of prepaids. I’ll call it Round 3.
If you follow some other blogs (or even watch the news) you may have already noticed a pretty significant development for Visa and MasterCard gift cards. As of April 1st they are starting to have the option of using a pin number like a traditional debit card (though be careful as I’m not sure they all have it at this point). This doesn’t mean you can just take them and head straight to the ATM to pull out cash, but it does mean that you can use them for purchases that require a PIN number – like when loading an American Express BlueBird at Walmart. Now how these gift cards are handling the PIN seems to really vary with some being more user-friendly than others. I like Frequent Miler’s post on his experience with some different types of gift cards, but I chose to do my own experiment a little blind (as in I didn’t read his before venturing out). This was partly just because I was in a hurry, but also because if you have to be a gift card expert to make this work then it really isn’t for me. Of course, I do recommend you reading his post before venturing out. 😉
First I headed to my old favorite for prepaids, Office Depot. I have very much enjoyed using office supply stores for their category bonus on certain credit cards, but it has become a much less lucrative endeavor over time as they first stopped carrying Vanilla Reloads and then stopped carrying the $500 gift cards. In fact, my own personal OD was very picked over in the gift department today. The best thing they had were two $200 Amex gift cards that each came with a gnarly $6.95 activation fee. I was on a mission today so I bought them and will earn 2,069 Ultimate Reward points at 5x from their purchase. My cost for those points was .67 cents per point. Considering I will get at least 1.5 – 2 cents per value out of my points (and often higher), the math is still on my side. However, the hassle and expensive factor is increasing since the amount on each card is so low, and the price is the highest I have ever paid. This also won’t help me directly with my BlueBird experiment since they don’t have a PIN, but it was good to stay current with what my local office supply store offered. I could also turn around and use them to purchase gift cards that have a PIN at another store, if I wanted.
On the up side I don’t mind visiting Office Depot as it is rarely crowded and easy for me to get to. I just wish they had a better selection of gift cards in stock.
After an easy visit at Office Depot I was ready to brave Walmart. Walmart terrifies me in some ways, so I try to avoid it as much as possible. However, it is the only place I know of where you can load your BlueBird via a machine. Like I mentioned at the beginning, I really prefer to not be treated like I am doing something sneaky, so I would rather deal with a machine than an employee who may either think I am up to no good, or just doesn’t know how to do what I am asking. However, you can also reload your BlueBird at Walmart via the employees and not just the machine.
My first stop at this WalMart was to the gift card section that lines the check-out aisles. Each check-out had its own mini-gift card selection over the candy and overpriced magazines. Some of the rows looked like a tornado had come through with more gift cards in a box at the bottom than in the shelves. However, I was able to find a card that looked good. It was a Walmart “Gift For You” Visa Gift Card that could be loaded with anywhere from $25 – $500 for a $4.94 fee. It was issued by the University National Bank – and it is not to be confused with the Walmart-specific gift cards.
I really had no clue what I was doing, but I liked that it said “Debit” on the package. Interestingly enough, when I bought another one later in the day it was labeled even better. So, I loaded it with $500 using one of my rewards earning credit cards and also paid the $4.94 fee.
My plan was to head right over to the Walmart Money Center ATM (usually located near their MoneyCenter/Service Center at the front of the store) to try and load it to my Amex BlueBird since it should work with a debit card, but not a credit card. Naturally, the machine was broken. At this point I felt like I needed to do more research before moving on anyway, so I headed home annoyed and a bit frustrated.
I went online to WalmartGift.com to register my gift card and see if I was able to add a PIN number as there was no info about a PIN on or in the package. While reading the FAQ’s about the card online I saw that the PIN was simply the last four digits of the card, as long as the card was purchased after April 1st. With this knowledge, I loaded back into the car to head to another Walmart to try and load this to my Bluebird.
Luckily the MoneyCenter machine was working fine at Walmart #2. I selected the “Walmart MoneyCard” option under Card Services (who knows why this option works to load a BlueBird, but it does).
I then told it I wanted to reload. It asked me to swipe my card (the BlueBird) on the pin pad, and then enter the amount to load. I selected $500 (the full amount on the debit card/gift card I just purchased) and after a few agonizing minutes it worked. The machine printed out a receipt showing my new BlueBird balance and my adrenaline went up a few notches. I wanted to do it again. If you want a detailed step-by-step process of using this machine read Million Mile Secrets post.
So, I headed to the gift card section at this second Walmart and found the same gift card I bought before, only this one had a handy sticker on it that said my PIN was the last four digits of my card number.
I again put $500 on the card and marched right back to the machine to feed my BlueBird some more money. It went through immediately just like last time, and that whole process from gift card purchase until I got my receipt from the Walmart MoneyCenter machine was about two minutes. That is doable even for busy parents.
I had spent $9.88 plus some time and gas to earn 1,000 points on my credit cards. That works out to a little under a cent per point, and while I value the points more than that, this wouldn’t be spectacular solely for that. However, I do think it makes sense to hit minimum spending requirements you otherwise couldn’t reach, and/or to trigger annual spending thresholds that otherwise would be outside your target. For example, I want to earn the two for one benefit on the British Airways card that requires $30,000 in annual spending on the card. That sounds like an out-of-reach number, but if we decided to use this method to pay our monthly mortgage and student loan, then all the sudden that number doesn’t sound out of reach at all. Also, if you are willing to add an extra step or two to the equation, you can shop online for gift cards via cashback portals that would reduce or even eliminate your out of pocket costs. You must follow Frequent Miler if you have any interest in delving deeper into the world of prepaids as I just scratch the surface.
In fact, this might be too doable. I really thought I was going to be writing about how this method is too much of a PITA for most buys parents who just want to pay things like student loans via BlueBlrd, but instead it is kind of the opposite. As long as you have easy access to a Walmart with a working MoneyCenter machine and a fair selection of gift cards, this is really easy as you could do $1,000 at a time on a BlueBird all in one stop within a couple minutes. Since it is so simple, I won’t be shocked if this method doesn’t stick around forever in it’s current form. I would love to be wrong though as this would make it relatively simple for me to put the BlueBird back in regular rotation for bills I can’t pay with a credit card. I will also add if you still have easy access to purchasing Vanilla Reloads with a credit card at certain drug stores, that is an easier method as you can load them online…but not everyone has that easy access.
I also want to include the caution not to go crazy with this. I personally put my $400 at Office Depot and $500 each at two Walmarts all on different cards from different issuers. I may be overly cautious, but I am not interested in having huge charges at stores like Walmart (though remember Visa gift cards are sold at all sorts of stores) start appearing on my accounts. I only plan to buy what I will actually use in a month to pay bills. I’m not going to be a Points Billionaire with this method, but hopefully it will keep me out of trouble, and make sure I can still (try to) sleep at night.
This isn’t nearly as lucrative as when we were buying reloads at office supply stores for 5x and loading them to the BlueBird online, but it isn’t a terrible option either…other than the fact you have to go to Walmart to load them.
What do you think? Have you used a gift card with a PIN since April 1st? Do you think this is a method you will use from time to time, or is it still too much hassle for too little return?