Using Amex’s Bluebird

Wouldn’t it be great if you could earn points/miles/cash back for things you can’t normally pay for with your credit card? Amex has a solution: Bluebird.

Bluebird works like a bank account in that you can deposit money to it and from there you can use its bill pay system to have Bluebird send out checks or you can get checks for that account and write them yourself. It comes with an Amex-branded card that you can use like a debit card to make purchases or ATM withdrawals.

The difference is that you must first add funds to your Bluebird account and only then can you spend the funds. You can add up to $5000 per month to your Bluebird account though I believe there is a maximum of $2500 per day.

How does this earn points/miles/cash back?

Adding cash to the account is where the points & miles comes into play. First, buy Visa gift cards using cards that earn points, miles or cash back. From personal experience I can state that the cards issued at Simon Mall and the Metabank cards from Kroger work just fine.

Simon Mall cards are cheaper at $3.95 for up to $1000 while the Metabank cards are $5.95 for up to $500 cards. Which should you choose? It depends on what type of points/miles/cash back you’re trying to accumulate. Simon Mall doesn’t count as a bonus category for any cards so you’ll just get the base points – AND American Express does not give out points for purchases made directly with Simon Mall so if you’re trying to accumulate Membership Rewards or points on one of their co-branded cards (Marriott, Delta, etc.) you won’t earn those points at Simon Malls. Depending on the card you have you may earn 1%-5% cash back or 1-6 airline/hotel points at Kroger – so the choice may become obvious.

Personally, I do a mixture of airline/hotel points and cash back each week. That way the cash back I earn can help to offset the expense of buying the gift cards.

Where do I start?

Go to Bluebird.com and open an account for free. You’ll get your card in the mail within about 7-10 business days.

How do I add cash to my account?

There are several ways to load your Bluebird account with cash but to use the gift cards you’ve just purchased you’ll need to go to either a Wal-Mart or a Neighborhood Grocery by Wal-Mart. Go to the Money Center or Customer Service desk and tell them you want to load your Bluebird and for how much. They’ll enter something on their keyboard then you’ll swipe your Bluebird card and confirm the amount. Next, tell them how much cash to load from the Visa gift card. They’ll enter that amount then you swipe the gift card and enter the PIN. For any single transaction you can have 4 swipes, which means one swipe of your Bluebird card and three more. With the $2500 limit per day you could swipe 2 x $1000 cards + 1 x $500 card. With the $5000 per month limit you could also do $1000 five different times during the month – it just depends on how convenient the Wal-Mart/Grocery locations are for you and how much time you’re willing to commit to this process.

My account has money in it, what now?

Now, it’s time to pay the bills. This process has been around for several years and I used it to make mortgage payments. You can also use this to make payments on your credit card bill and pay off the very cards you just used to buy the Visa gift cards!

Note: any time you pay a bill, whether it’s sent out in the form of a check or an electronic transaction (like to a credit card company) the money disappears from your account immediately. There’s no “waiting for the check to clear”, the money is gone instantly.

Use this method to pay your rent/mortgage, other people, the guy who mows your grass, your church, charities or anyone else that will accept checks but not credit cards.

Other advice?

Take. It. Slow. Bluebird has been around for a number of years and 2 years ago thousands of us across the country were shut down. We typically met a certain pattern: load up the maximum amount of the cash in the first 2-3 days of the month then spend everything right away. Bluebird is targeted to folks who don’t have a bank account and this is not their typical spending habit. Earlier this year after hearing it might be possible, I was able to open another Bluebird account. While I used the same Social Security Number, I used a different email address and login name. I don’t know if that made the difference or not but it’s been a number of months now and my account is still open. The difference this time is my pattern for loading and spending. I’m only loading about $1000 per week and am paying off credit cards once a month instead of making multiple payments to the same card throughout the month.

As long as you take it easy, you should be fine. Feel free to ask any questions you may have in the comments!

Categories: Advice, Manufactured Spend | Tags: , | Leave a comment

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