SUNDAY, JANUARY 11, 2009
Statefarm Gift Cards: Another way to earn points on your credit card
Opening credit cards is a great way to earn the amazing signup bonuses that cards offer. The thing is, my favorite card to churn, the Citi American Airlines MasterCard, requires $750 in spending before getting the 25,000 miles signup bonus.
Now, I don't like to do my regular spending on these cards, as I like spending as much as possible on one credit card, my Amex Starwood. Besides, it would be quite confusing to keep switching credit cards every time I open another credit card. And, I don't always spend enough to cover all the cards that I open. So, I like to find ways to 'spend' the $750 without actually using it for my regular spending... which is why I like buying coins from the Mint.
Buying Gift Cards:
Here's another interesting way to spend money on your credit card without actually spending money. If you don't clearly understand how this works though, and don't feel confident, don't do it! Stick to the mint.
Purchase $500 gift cards from Statefarm, and have the money deposited into your bank account. Unlike the coins from the mint, this only works with Visa and MasterCard, not Amex.
You will receive the gift card in the mail within a week. Once you have it, call to activate it. This is automated and takes about 30 seconds. Then, go to the Statefarm website and 'unload' the money into your bank account. You will need the 'routing number' and 'account number' for your bank account. You can find these numbers on on a check. It should take 2-3 days for the funds to be deposited in your bank account. Now you can go ahead and pay your credit card with the money in your bank account.
The cost of the gift card is $4.95, and then another $1.00 to transfer the money into the bank account. So, with a $500 gift card, you should only transfer $499 to your bank, and leave $1.00 on the gift card to pay the fee. The total cost will be $5.95 for $504.95 worth of points, miles or cashback.
There is a limit of $1,100 a day, per credit card. If you want to buy more than that, you can either use another credit card or a virtual credit card number.
Buying the coins from the Mint is definitely the cheaper way to go. It's free, and you can use an Amex card. But if you are either not interested in dealing with bringing coins to the bank, or you've already maxed out on the coins, this could be a good method to 'spend without spending'.
Disclaimer:
As with everything else on this site, make sure you understand and know what you are doing, and do it at your own risk.
