Many credit cards offer large, attractive amounts of bonus miles on new accounts after spending a minimum amount of money within a certain period of time.  The amounts vary: sometimes they are as low as $2,000 or $3,000 but as high as $20,000.  The timeframe in which you must spend this amount is typically 3 months but it can be as long as the first year of account ownership.  To meet the minimum spending requirements (or just plain increase the amount of miles or points that you earn) on credit cards like the recent American Airlines or British Airways offers, there are some ways that you can achieve this without having to spend much or any of your own money.  This practice is known through blogs and various forums as “manufactured spending” and I’ll describe two of the easiest and most common methods in a posting today and tomorrow.  As with anything, moderation will be the key to your success.

Method #1: Amazon Payments

Set up a free account on https://payments.amazon.com/home and you can send up to $1,000 per calendar month with no fees using a credit card to anyone else who also has an account on Amazon Payments.  Once you send the payment, Person B should receive an email within a few hours with notification that there are funds in their account.  Person B can then withdraw the money to their checking account for no fee and it will post in a few business days.  Person B can then send $1,000 back to you on Amazon Payments using their own credit card.  Once you receive the funds in your Amazon account, you can transfer them to your checking account and use the cash to cover the $1,000 charge you made on your credit card.  The bottom line is that both of you appear to have spent $1,000 on your credit card, which counts towards earning rewards and meeting minimum spending requirements, but you’re not actually out any money.  A few tips for using Amazon Payments:

• Use this with people you trust!  After all, you’re giving someone up to $1,000 and expecting them to do the same.
• Two people are fine but a group can be even better.  In the above example, Person A pays person B, they withdraw the amount from Amazon, then Person B pays Person A back and then they withdraw the amount from Amazon.  Another way to do it is Person A sends money to Person B, Person B sends money to Person C, and Person C sends money to Person A.
• Don’t use the same IP address as the person with whom you send/receive payments.  This means don’t use the same computer or the same WiFi network.  Amazon looks for suspicious patterns and if they suspect that you might be abusing their system, they could shut down your Amazon Payments account.
• Send several smaller amounts that add up to $1,000.  Get creative and send, for example, $250, $400, and $350 over the course of a few days.  Sending smaller amounts as opposed to $1,000 is less likely to raise any red flags at Amazon.
• Withdraw the money as soon as you receive it.  It’s your money so transfer it to your checking account as soon as you can.  I also recommend that you transfer all available funds to your checking account before you send money to someone else.
• Try to utilize the month to spread out your activity.  For example, Person A could send a few amounts to Person B during the first 2 weeks of the month and Person B could send money back to Person A during the latter half of the month.
• Remember, the limit is $1,000 per calendar month.  In theory, you could send someone $1,000 on January 31 and then again the next day on February 1.

Look for my posting tomorrow on my favorite manufactured spending technique, Vanilla Reload Cards.