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Seems like American Express is always coming up with excuses to cut the fees on purchasing their prepaid gift cards – and there’s no reason folks with points-earning credit cards shouldn’t benefit. Buying American Express gift cards can be a great way to meet the minimum spend requirements for huge credit card sign-up bonuses, as well as to keep earning points beyond sign-up bonuses and even meet calendar year spending threshold bonuses.
The last no-fee Amex promo ended on April 1, but now for “Administrative Professionals Day,” Amex is offering gift cards with no purchase fees through May 31, 2014.
You can order here and be sure to enter the promo code ADAYBCN to get the purchase fees taken off your total.
American Express gift cards are great because they are accepted everywhere Amex are accepted just like a credit or charge card, so whether you’re buying them for yourself or giving them to others, it’s basically just like buying money.
The reason this promo is good news is that Amex normally charges a purchase fee of between $3.95-$6.95 per card (depending on its value) and about $5.95-$8.95 in shipping since it must be done via UPS, so you really have to crunch the numbers to make sure those extra points are worth spending on those fees.
However, when Amex waives the fees on gift card purchases, that calculus shifts. You can buy up to $5,000 per order and a shipping fee of $8.95 applies. However, if you are purchasing and shipping them as a single order to the same address, you’ll just pay shipping once.
Before you go straight to Amex, though, remember that you can often get rebates and discounts on Amex gift cards through online rebate sites. Right now, here are the rebates being offered.
Top Cash Back is offering 2% rebates on Amex Gift cards.
Big Crumbs offers up to 1.2% back on Amex gift cards right now.
And Ebates is offering 1% cash back (offer ends April 30):
So depending on the value of the card you buy and the shipping fees, you could be saving as much money as you’re spending on shipping – or even getting more money on the Amex gift cards than your order costs altogether including shipping.
If you’re interested in doing so, here are some quick instructions for you:
1. Create a Top Cash Back, BigCrumbs or Ebates account.
2. Once logged in, search for American Express – a few results will come up including one for cash back on Amex gift cards. Click on it to be redirected to the Amex site.
3. Sign-in with your American Express ID. If you don’t have one, you can create one (you do not need to be an Amex cardholder to buy Amex gift cards).
4. Choose how many you want – up to $5,000 per order. If you’re just going for straight-up spending, I’d suggest a full $5,000 order to hit the max with the lowest shipping costs, though you can order as many as you like.
6. Check out. It will default to your Amex cards (if you have them), but you can choose to pay with a Visa, Mastercard, or Discover.
With the current Top Cash Back 2% rebate, for example, a purchase of $5,000 in gift cards will cost you $5,008.95 minus the $100 from the 2% rebate, so you’re getting $5,000 worth of gift cards for $4,908.95, plus 5,009 points. Not bad!
In some cases, the purchase of Amex gift cards is coded as a cash advance. I have never personally had this issue myself, but Citi and Chase will charge them as cash advances, so be sure to do a test order before you go buying thousands of dollars worth of them. On my American Express statements, these purchases are categorized as “Business Services – Other Services,” and I’ve earned Amex points when buying them. However, several TPG readers have reported that Amex won’t count these purchases towards meeting spend requirements, so feel free to share your experiences.
Some people who have bought a lot of gift cards at once have also reported getting their account audited by American Express’s Financial Reviews department – especially when making the purchase using their Amex business credit cards (they are a higher risk to credit card companies than personal cards). Amex conducts financial reviews in an attempt to identify people who are likely to rack up huge charges and then default on the debt – something people who make suspiciously large Amex gift card purchases are prime suspects for since it’s like cashing in on your credit line without getting a cash advance fee.
However, I would never, ever, under any circumstances suggest that you do anything irresponsible or try to abuse this in any way because it won’t work, and you’ll end up ruining your relationship not only with Amex, but also possibly your entire credit report. Used legitimately and with consideration, though, this can be a great way either to rack up some bonus points or hit minimum spending requirements, or to get friends and loved ones nice gifts they can use anywhere, all while being savvy about sustainable points earning, and even earning a nice little cash back discount.
Know before you go.
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