My Credit-Card Strategy Has Gotten Me Discounts of Nearly 15%

For example, my Amex Platinum Card currently has an offer for $10 back on purchases of $100 or more at supermarkets; the offer can be used three times, for a total of up to $30 back.

I rarely spend $100 in a single grocery trip, and I do the bulk of my food shopping at our local co-op, but the Safeway near my house sells a variety of third-party gift cards. With this Amex Offer, I can get a 10% discount on future purchases at many of the merchants mentioned above.

Another way I save is to look for discounts or bonuses on gift card purchases. For example, Best Buy might offer a 10% discount on Netflix gift cards, or Lowe’s might offer a bonus $15 Lowe’s gift card to customers who buy a $100 third-party gift card. So long as the eligible gift cards are ones I’ll use, the discount or bonus is as good as cash to me.

Finally, I keep an eye out for deals on prepaid Visa, Mastercard, and Amex gift cards, which I can then use just about anywhere that accepts credit cards. These prepaid cards typically tack on a purchase fee, but Staples and Office Depot (among others) frequently offer promotions that waive those fees, meaning I can buy them at no additional cost while earning 5% cash back on my Chase Ink card. I then use the prepaid cards on purchases where I would earn fewer rewards otherwise, like at my gym or auto mechanic.

I stack savings for an even bigger net discount

One great aspect of these strategies is that they can be combined not only with each other, but also with other savings and rewards like online shopping portals and member discounts. One recent example is a sale Staples had in early July on several brands of gift cards, including $100 Airbnb gift cards for $90. By paying with my Chase Ink Business Cash® Credit Card, I earned an extra 5% ($4.50) back, giving me a total discount of 14.5%. 

Another common example is using my Shell Fuel Rewards membership to save 5 cents per gallon on top of whatever discount I’ve gotten on my Shell gift cards. There are lots of creative ways to stack, depending how much effort I feel like putting into it.

The downside of gift cards

Speaking of effort, when I consider a way to save money, I try to look at the big picture. Saving money is great, but at what cost?

First and foremost, I’m protective of my time. Saving a few bucks isn’t personally worthwhile if I have to squander significant time in the process, so I’m mindful of how long I spend taking advantage of deals. If I can save by purchasing a gift card online or tossing it in my cart when I’m already at the store, that’s an easy win. If I have to go out of my way, then the savings need to be commensurate with the extra time spent.

Part of that calculation is the time I put into keeping my gift cards organized. I used to just toss them loose in a box, and while I don’t think I ever threw out a loaded card, I can’t say for sure. Now I have a system for cataloging gift cards when I get them and disposing of them when they’re drained. It doesn’t take long, but ignoring the time I spend on that extra step would yield a dishonest accounting of my process.

The system I use to keep my gift cards organized

There are two parts to my system. One is keeping them physically organized; to do that, I use a cardboard box that I think is meant for storing baseball cards. I arrange them alphabetically by brand so they’re easy to find and all cards of the same brand stay together. I used to keep them loose in a box and I’d forget about some of them or not realize I had multiples for a single merchant, so I wouldn’t use them together when the opportunity arose.

The other component to my organization is keeping track of their value, which I do on an Excel spreadsheet. When I buy a gift card, I note the brand, the dollar amount, the date of purchase, and the gift card number/PIN where applicable. This helps me track partial balances, and is useful if I ever do misplace a gift card or have to return an item I used a gift card to purchase. Once a gift card is drained and I’m confident I won’t need it again, I move it to a different tab on the spreadsheet.

Apart from the effort I put into buying gift cards, I try to keep in mind a few potential pitfalls. First, shopping with a gift card means I can’t rely on benefits like purchase protection or return protection that I get when I use a credit card. That’s not a problem for purchases I consume quickly, like gas or groceries, but it’s a concern for goods like electronics or household items, or anything I might want to return, since funds typically go back to the original method of payment. The less certain I am of a purchase, the less inclined I am to use a gift card.

Next, gift card purchases are generally reliable, but not infallible. Sometimes cards don’t activate properly, or they’ve been compromised and the balance is drained as soon as they’re loaded. Both scenarios have only happened to me once, but getting my money back was a hassle in each case.

Gift cards may also have unexpected rules or limits on redemption, such as the Shell station I frequent only accepting gift card payments inside, not at the pump. That adds time to the fueling process, which I have to factor in as discussed above.

Finally, like the gift cards themselves, the rewards or discounts I expect to earn don’t always work out as planned. For example, the terms of the Amex supermarket offer described above specify that gift card purchases don’t qualify. I know that in practice third-party gift cards do trigger such offers, but there’s always a chance I won’t get that extra cash back.