A reader recently wrote to me asking if there were any super-secret hush-hush methods of manufacturing the $1,500 in 5% cash back offered by this quarter's Chase Freedom bonus categories. As a reminder, those bonus categories are "Restaurants, Bed Bath & Beyond, H&M, and overstock.com."
I sent along to that reader, but also wanted to share with any other readers who may have missed Tagging Miles' post that Bed Bath and Beyond sells $200, PIN-enabled Visa gift cards with an activation fee of $6.95.
As I explained in a guest post at Doctor of Credit's website back in December, earning 5 Ultimate Rewards points per dollar on $200 PIN-enabled Visa gift cards isn't a great deal in terms of outlay ($6.95) versus income ($10.35). Rather, it's a good deal precisely because they're $200 Visa gift cards, so you can cram a lot more of them into a Bluebird or Serve card's $5,000 monthly load limit, or into a bank or credit union's without worrying about a high-volume "fraud" tripwire.
My experience at Bed Bath & Beyond roughly mirrors Tagging Miles': not all stores carry Visa gift cards, not all stores carry $200 cards, and stores that do may be extremely reluctant to sell large volumes. Yesterday I had trouble buying just $600 in gift cards, requiring a manager to slowly walk the cashier through the process, since she was sure she would be fired for letting so many cards walk out the door!
In any case, while I know many of my readers won't have any trouble spending $1,500 at restaurants this quarter, I'm as a rule extremely reluctant to use cards for both manufactured spend and "real" purchases. So if you're like me, go ahead and take 3 trips per Chase Freedom card down to your local Bed Bath & Beyond and buy no more than $600 per visit. Then you can get back to putting your actual restaurant charges on a 2% or 2.22% cash back card.