Guide to Maximizing Points and Miles for Baby Purchases

Update: Some offers mentioned below are no longer available. View the current offers here.

I often stress the importance to award travelers of earning points or miles on every dollar spent, and since having kids isn't known for being cheap, today TPG Contributor (and new father) Nick Ewen offers his strategies for earning travel rewards from baby (and parent) related purchases.

If you've read some of my posts from earlier in the year, you may have known that my wife was expecting our first child in November. Well, Evelyn Elizabeth Ewen was born on November 28th at 11:16 pm, and naturally, as a points and miles writer, I immediately started thinking of how to maximize the (many) purchases we'll be making for her as an infant and beyond. Today I'll share some strategies I've used (and plan to use as she gets older) to make the most of these baby purchases.

I want to state right off the bat that these suggestions are not only for those with kids. Many of our friends have had babies over the last few years, and I used several of these tricks to make the most of the gifts we sent them. So even if you're not expecting, these strategies will still help!

Loyalty Programs

While this first tip doesn't pertain to purchases, it's an important consideration for anyone with children. Kids (including babies) are generally eligible to earn points and miles with frequent flyer or hotel programs just like anyone else. Sign your kids up with your favorite programs and manage their accounts; think of it as a college travel fund so they can't cite pricey airfare as an excuse for not coming home to visit during breaks.

Registries

When my wife and I announced that we were pregnant, one of the first questions people asked was where we had registered. While my wife loved the cutesy things from Pottery Barn Kids, I was drawn to the practicality of Amazon.com. Wherever you register (or wherever you are purchasing registry items for a friend), there are several ways to get the best bang for your buck on these purchases:

1. Go through online shopping portals: Purchasing baby gifts online not only saves you a trip to the store and cuts back on the hassle of arranging shipping; it also gives you a wealth of bonus earning potential. Many common sites that couples use to register are found on various online shopping portals, including Target, Babies 'R' Us, Pottery Barn Kids, and Wal-Mart. Remember that EVReward.com is a great starting point for figuring out which portals offer the best deals.

For example, Target is currently offering 4 AAdvantage miles per dollar spent when you go through the AAdvantage eShopping portal. You could purchase the Britax Marathon G4 Convertible Car Seat (the same one given to us by my wife's sorority sisters) for $259.99. Let's say you bought it through the AAdvantage portal using your Barclaycard Arrival Plus World Elite Mastercard; you would earn:

$260 x 2 Arrival miles per dollar = 520 Arrival miles
$260 x 4 AAdvantage miles per dollar = 1,040 AAdvantage miles

Based on TPG's November valuations, which pegged Barclaycard Arrival miles at 1.1 cents apiece and AAdvantage miles at 1.7 cents apiece, you're looking at a value of $23.40, or roughly a 9% return.

Amazon.com is a little more challenging when it comes to these online shopping portals, as they tend to limit their earning bonuses to Ebates, Mr. Rebates, and MyPoints, and the categories are limited. However, I have seen bonuses for baby items as high as 8 %, and they tend to change all the time, so check back regularly to see if registry items are an option.

Speaking of Amazon...

2. Use the Chase Freedom. (No longer open to new applicants) For the rest of the year, Amazon.com is one of the merchants offering 5% cash back (on up to $1,500 in purchases per quarter). Chase also announced their 2015 bonus categories earlier this month, and Amazon will again be included in the fourth quarter. The timing was perfect for us, as we've been purchasing some final items ourselves and plan on spending the full $1,500.

However, because I also have the Chase Sapphire Preferred and Chase Ink Plus cards, that 5% cash back can actually become 5 Ultimate Rewards points per dollar spent (see this post for more details). By spending exactly $1,500 on Amazon.com purchases this quarter, I'll earn 7,500 Ultimate Rewards points. These are worth $157.50 based on TPG's valuations, for a stout 10.5% return.

3. Take advantage of completion discounts. This applies to couples who are expecting a baby (or have had one recently). Many retailers will offer you a one-time discount for purchases made within a certain window leading up to (or after) the birth of your child. This article from U.S. News provides a great overview of these options, though note that many of these discount certificates or codes cannot be combined with other offers.

Medical Expenses

Having a baby is an expensive proposition. Insurance policies vary widely, and without coverage, bills can easily reach well into the five-figure range. Fortunately, many health care providers do accept credit cards for these expenses. However, it's essential that you're able to pay the credit card bills for these purchases in full, as any interest charges will more than negate the value of rewards you earn.

Suppose you're on the hook for $2,000 out-of-pocket after insurance. If you put that entire amount on the US Airways Mastercard, you would earn 2,000 Dividend Miles, worth $38 according to TPG's valuation of 1.9 cents apiece. However, an interest rate of at least 15.99% would offset that value and then some.

Any large out-of-pocket expense would be a good opportunity to meet spending requirements for credit card sign-up bonuses (again, assuming you can pay the bill without interest). That same $2,000 bill would be enough to earn the bonus of 50,000 Avios from the British Airways Visa Signature Card, for example.

Diaper purchases

Diapers are a significant expense with a new baby (I'm surprised at how many little Evy has already gone through). Fortunately, there are some easy ways to make the most of these purchases:

1. Amazon Mom. This is a terrific service that's basically an extension of Amazon Prime. $99 per year gets you free two-day shipping, instant access to movies, TV shows, and songs, and a 15% registry completion discount (as opposed to the standard 10%). In addition, if you sign-up for monthly diaper deliveries, you receive 20% off those as well. Remember that both the American Express EveryDay and Everyday Preferred cards come with a year of Amazon Prime for free, and Amazon Mom can be added for free to existing Prime accounts, so this is a nice way to take advantage of these discounts.

2. Honest Company. Another option for monthly diaper shipments is the Honest Company, which counts Jessica Alba as a co-founder. You can sign-up for repeat diaper (and wipe) deliveries, and save up to 35%. Plus, their products are eco-friendly and completely safe for use on (or with) children. With free shipping and no up-front fees, this is a convenient way to get diapers to your doorstep.

Unfortunately, there isn't any type of online shopping portal you can go through to maximize your earnings, but the repeat delivery option can be a great way to meet an annual spend threshold on a credit card. For example, the Citi Hilton Reserve card gives you a free weekend night certificate after spending $10,000 in a cardmembership year. With a bundle price of $79.95 per month, a year's worth of diapers gets you almost 10% of the way there.

3. Diapers.com. A third option for diapers is the very originally-named Diapers.com. At a quick glance, their prices appear to be similar to those on Amazon. For example, a 216-count box of Pampers Swaddlers Size 1 goes for $47.19 on Amazon.com (or $44.83 with monthly delivery). Diapers.com has the same box for $47.99 (or $43.19 with the auto-ship option).

Here's where things get interesting. Diapers.com is available on multiple online shopping portals, and like Target, they're currently offering 4 AAdvantage miles per dollar spent. Unfortunately, you could only go through AAdvantage eShopping for a one-time purchases and not the auto-ship option. Let's assume you made the purchase with your Citi Double Cash card, which gives you 1% back on your purchases, plus another 1% back as you pay your balance.

Option 1: One-time purchase through AAdvantage eShopping
$48 x 0.02 = $0.96
$48 x 4 miles per dollar = 192 AAdvantage miles (worth $3.26)
Total value of cash back & miles = $4.22

Option 2: Auto-ship option
$43.19 x 0.02 = $0.86
Total value of cash back = $0.86

Option 2 is thus the better option. Even though you give up the bonus miles from the shopping portal, you're saving $4.80 by going the auto-ship route, which is more than the extra $3.36 of "value" you get with the one-time purchase through the AAdvantage eShopping portal.

Gift Cards

Gift cards are among my favorite items to give and receive for birthdays, holidays, and all other gift-giving occasions (yes, I am unoriginal!). If you have a friend or family member expecting a baby, consider purchasing a gift card for her, either in store or online. And if you just had a baby, gift cards can be a great way to earn bonus points on expenses that fall into a "standard" category for earning purposes.

You can find gift cards at many pharmacies, gas stations, and supermarkets, but my favorite method for maximizing points earned on gift cards is going to office supply stores and using my Chase Ink Plus card, which earns 5 Ultimate Rewards points per dollar spent. An even better option is purchasing electronic gift cards online from Staples, since that opens up additional earning opportunities with online shopping portals. You can also earn 5% cash back at office supply stores with the Amex SimplyCash Business card.

Here are some options that would be great for a baby (or even a toddler):

• Clothing: Kohl's, Sears, JCPenney, Gap, Nordstrom, Old Navy, Carters/Osh Kosh
• Baby items: Toys R Us (valid at Babies R Us)
• General items: Target, Kmart
• Pictures: Krome

You could also consider purchasing a restaurant or SpaFinder gift card to pamper yourself (or your friend/family member) either before or after the birth. After all, mommy and daddy deserve a little TLC too!

Childcare

Another common expense is childcare, whether you're paying for a private in-home nanny, full-time daycare, or even just a babysitter on a Friday night. Here are some things to consider when it comes to earning points and miles on these expenses:

1. Check your daycare provider's credit card policy. Many private daycare providers will accept credit cards as a form of payment. However, it's important to check and make sure that they don't charge a fee for doing so, as that could negate any earnings. For example, the daycare where we enrolled Evy (starting in March) charges a 3% fee for credit card transactions. I don't have any cards that would give me a return that would cover that fee.

However, if your daycare takes credit cards with no fee, go for it! According to the National Association of Child Care Resources & Referral Agencies (NACCRRA), center-based daycare costs an average of $11,666 per year in the United States. You could use a card like the Starwood Preferred Guest® Credit Card from American Express (TPG values SPG points at 2.4 cents apiece) to earn 11,666 Starpoints for those expenses, which is almost enough for a free night in a Category 5 hotel like the St. Regis Abu Dhabi. Expenses like this would again be a good opportunity to meet minimum spending requirements ad earn sign-up bonuses for whatever cards suit your needs.

2. Consider Care.com. While my wife and I have not yet considered a night out (after all, Evy is only three and a half weeks old!), Care.com is a popular site for hiring across the spectrum of child care services. You can also make payments directly to care providers using a credit card, so this is a great way to avoid writing checks or taking out cash.

3. Consider using a prepaid debit card. This is probably the least desirable option, mainly because retailers of reloadable prepaid cards have all but eliminated the ability to purchase these with a credit card. However, if you have a local supermarket or pharmacy that somehow still allows you to purchase things like Green Dot MoneyPaks, you can then apply those balances to your prepaid debit card, like American Express Bluebird or Serve. These cards then allow you to cut checks to individuals that don't take credit cards.

Bottom line

Having a kid can be an expensive proposition, but as award travel enthusiasts know, spending and earning tend to go hand in hand. I'm still navigating the ins and outs of fatherhood, but my wife and I are taking advantage of every opportunity to maximize our purchases for Evy. I hope these strategies have been helpful for parents (and soon-to-be parents), as well as those who need to purchase gifts for loved ones who are expecting.

What are your favorite ways to maximize purchases for your kids?