No, I will not be trawling banks for $9,998.50 cash advances

Blame me for lack of chutzpah, but I will not be heading to banks for $9,998.50 cash advances off My Vanilla Debit Cards.

I read about this method to earn miles on View from the Wing, which drew on a post from the realm of those who push the outer limits, Dan’s Deals. View from the Wing clearly discusses pros, cons, risks, commitment-level, so this is no criticism of his piece. It is a counterpoint to the often intoxicating excitement that follows originally sober argument, as many copycats will soon be touting this as the latest pot of gold.

I don’t see anything particularly immoral in this, it is between you and your card issuer, what I see is a ton of work, not insignificant fees, and a lot of time feeling uneasy walking into stores and banks. Maybe this is a mix of my Midwest sensibilities and my shyness, but living in the NYC metro area, where I need to produce ID at my local shopping mall to purchase a pair of socks with a credit card, I just don’t enjoy this and don’t need the miles that much. I don’t want to have to hire an armored car to shuttle me and my sacks of cash around the city.

The incremental miles to blow on a flight or hotel are not enough enjoyment for me to spend my days skulking the streets of NY, eyes darting as I slip into banks hoping they play ball on massive cash advances.

I have dabbled in Vanilla and Bluebird, it is a great method to pay my rent, a genuine expense. I don’t need to expand it beyond that modest time and cost commitment.

Others certainly get their kicks out of this and that’s great for them. For me, some ‘deals’ I am happy to pass up, no matter how electrifying.

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  • I am with ya! I ordered my BB for my house payment and that will just about be it. Maybe gas & electric. Too much for me (& I do 2+ day mileage runs and say that)! 🙂

  • So is it the shame/embarrassment or the time needed thats going to stop you. I would guess you’d be passing up 1-2million miles/points on the program of your choice.

  • @MileageUpdate – it’s a mix of both, I can’t say exactly what % breakdown. How much time and cost do you think it takes to get that 1-2 million, including incidental costs such as car and gas for drivers, etc?

  • Not much more than the normal errands. Just a few extra stops along the way. Certainly I feel its less than the cost of traveling Biz Class and staying multiple hotel stays on points. I agree that there is a trade off but $30k-40k worth of travel funds is worth some amount of effort.

  • @MileageUpdate – it seems to me that it is just the normal stuff, but as an example, last week, with wife and mother-in-law waiting the car during our holiday, I went into a CVS, took 20+ minutes to get through the purchase of 6 Vanilla cards, all the while Citi fraud prevention calling me for rejecting accounts and me switching to non-Citi cards. Scaling this up seems to require tremendous time or getting extremely lucky with Vanilla source and bank combo.

  • Its only painful until your CC knows your spending habit. Then again if its too much of a hassle then its never worth doing. Who among us hasnt had the MO printer run out of paper or jam etc etc. But everyone has a price on their time so I understand why you might not value the adventure in plastics.

  • john

    I agree and this is an interesting debate. Everybody has a different pain threshold. All of this funniness is way to painful for me… I dont like to leave the house for anything but work or recreation (no errands)… I buy everything online and pay everything online.
    For me the biggest issue with all this is the complication of getting it all right/remembering everything you have to do … ie avoiding fees for screwing up somehow…
    Everything is on auto pay its too hard for me to even figure out how to pay the mortgage with BB… what if I forget or it shows up late and I get the XXX$ fee… This just looks like way too much thinking and watching needed.

  • I agree. I don’t mind doing the Ink at OD to buy Vanilla GCs to buy VRs at CVS to load to BB to pay off my bills. But this just seems like asking for a bad time.

  • @Amol – yeah, something about activities where the average person’s first response is, “Is that legal?” and their second response is “Are you really sure that’s legal?” are not up my ally.

  • I will say that it prob takes a certain type of personal trait to delve into the process deeply. Organization is a necessity. As John says about fees and the like that it can get out of hand quickly. But it does become routine once you get a system down.

  • Robert

    For those of us in slightly more civilized areas of the country, neither armored cars or IDs at every turn are required…

  • @Robert – and every day I spend in my current domicile I want to be elsewere, sometimes sacrifices for family are necessary, and I drew the short straw.

  • michael

    Those who push the limits will have issues those who purchase 1- 500 dollar card a mth per card will most likely have no issues staying under the radar.

  • Robert

    @ Rapidtravel–I am thankful for each day since leaving DC…good luck!

  • Nick

    Great post, thanks.

    I have > $20k in fixed monthly expenses for my business. I’ve been looking for a way to create a points arbitrage but I fear if the limit of the vanilla cards is $1k it may be too much of a hassle to cancel all of my auto payments, etc. Am I missing something?

  • @Nick – it seems pretty uncontroversial to do a Bluebird card for the max of $5k/month in Vanilla loads, you do have to manually add them $500/day and then remember to do all your bill payments, which requires time and effort. You can’t do recurring payments with Bluebird which is probably good since it is hard to make sure you always have funds in the account if your Vanilla source is unreliable. If you have a spouse, that can be another card and another $5k. It keeps going from there with other family members and such, depending on your tolerance for hassle. All of this takes a lot of time and effort that the proponents dismiss.

    This cash advance thing I was referring to is to put money onto My Vanilla Debit Cards, potentially many thousands of dollars, use banks for huge cash advances, then take the cash to pay off the credit card bills. That is taking it to a whole different level and is not specifically relevant to your desire to pay actual bills.

  • Faye

    I just got my first vanilla reload debit card from cvs for $500. I do have a bluebird account. I’m not planning on over doing this, but maybe I can use this to pay a few bills (toll, parking, cable , Internet bills? I do have auto payment already set up, but if I go in there and use the bluebird to pay it before it charge my credit card that’s already on file, it should work, right?

  • @Faye – just to be clear, the Vanilla reload cards work with Bluebird and are useful for bill pay. Your existing autopay will pay the amount on the monthly statement, so you would want to make manual payments ahead of the statement date, and auto-pay would either have a zero balance or pay any remainder. I currently pay many of my bills, including my apartment rent with Bluebird, and I do not anticipate any problems, since that is one of the express intentions of BlueBird. The areas were people think there may be scrutiny is repeatedly sending large personal payments, such as to a spouse at the same address.

    The My Vanilla Debit Card is for purchases, not bill pay, which is why the post I linked to described efforts such as bank cash advances to pull the money out.

  • Sadly I can only do so many different angles. With debit cards, BB, VR and a few others it seems I almost am at max capacity. I guess I need to reevaluate which avenues are most advantageous and possible have some synergy. Either way their are many scale-able deals currently.

  • Sasha

    What are the RISKS in doing this?

    The way I see it…
    (A) The credit card companies profit tremendously because you are spending a ridiculous amount on your cards. They will definitely be on alert for fraud and will occasionally decline purchases, but this is a minor headache at worst.

    (B) The merchant stops carrying the cards. That means end of the game for sure, but its not a “loss” scenario

    (C) Getting cash advances becomes difficult. This is definitely the worst case because then you are stuck with useless illiquid MyVanilla Debit Cards, but all it really means is that you have to pay a slight premium to liquidate your funds

    So…. unless I’m mistaken, as long as you can afford the loss of liquidity and time commitment, theres no reason not to do this

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  • De

    Can you get a cash advance from a vanilla “gift” card? (Not black my vanilla) it is MC/VISA branded and has “debit” listed on the front?

    (Odd that I read “Sasha’s exact post above from another blog)

  • @De – my guess is no, but you should be able to see in the terms that come with the card, also, even if technically possible, as I understand most banks will only do a cash advance from a card with your name on it, not a generic card.

  • David

    I understand the intent of Bluebird is to pay off bills, but what happens if I use Bluebird to pay off the same credit card that was used to load the Vanilla reload? e.g. If I buy a $XXX Vanilla reload using credit card ABC, load onto my Bluebird and then use Bluebird to pay off the same credit card ABC, would that raise any flags?

  • @David – this is still new territory, most people are nervous about trying that with Amex cards, but other card issuers would not necessarily have any reason to try to connect the dots from, say, large CVS purchases along the chain to a payment received via Bluebird. You probably do not want your only card activity to be repetitive large purchases of the same amount from the same store followed by paying it off. None of us know what sets off red flags, but this does seem lower risk if you are mixing in with other kinds of spend.