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Living abroad and getting your wallet stolen- a veterans tale

If you travel a lot, live abroad, or study abroad, chances are that someday you’re going to lose something important or something important will get stolen. I’ve had both: I was confronted by a group of young men in a bus in Germany during which my wallet curiously went missing. On a recent trip to Toronto  which was a feat in and of itself, see previous post), my flight was delayed by almost three hours, we changed planes twice, I waited in line for almost two hours atScreen Shot 2014-04-15 at 6.38.58 PM immigration, my luggage was lost, and somehow during the chaos my wallet went missing. Although in both instances I had taken a number of precautions to avoid these situations, you can be the most organized and cautious person in the world and something like this can still happen to you. I’ll admit it, I got a little lazy with my wallet and other belongings. I’m used to backpacking in the Middle East or Central America where I thoroughly prepare my belongings and go through a checklist to make sure everything is in its proper place. Going to Canada for a conference, I think I took security less seriously than I typically do. Serves me right. Between having my wallet stolen while living abroad (including my passport), and having my wallet lost while on a short international trip, I’ve learned a few lessons.

Before you travel

Most of this stuff is common sense, but it helps to remind ourselves:

  1. Make a travel checklist with all the following on the list and keep it somewhere accessible.  Although I have a travel checklist that I continually update and edit in Evernote, I didn’t use it for my trip to Canada because I got lackadaisical.  Had I done so, I might have remembered to empty out my wallet of unnecessary cards and saved myself some headache.
  2. Put a travel alert on your credit and debit cards if you plan to use them abroad.
  3. Only bring the cards you know you will use. Rather than simply throwing your wallet into your carry-on as is, take the time to empty it of any unnecessary cards you won’t use (like a local library card) or can’t be replaced (like that spa punch card that is only one massage away from a free treatment–yeah, I lost that too). Empty your wallet of excessive amounts of cash (you will want some but not a lot until you get to an ATM in your destination country).
  4. Put a stash of emergency cash or credit cards or both somewhere other than your wallet. This could be in a special travel wallet (see number 10).  I normally take the time to do this before I travel but I didn’t do it before going to Canada. When I discovered my wallet was missing, I had nothing. Literally nothing. No cash, no ATM card, no credit card. No way to even pay for the subway to get out of the airport.
  5. Keep your credit and debit card information, as well as your ID cards somewhere other than your wallet. I didn’t have this the first time my wallet was stolen, and I had a hard time remembering everything that was inside.  Now I keep a copy of my cards in an encrypted file on a USB stick I carry with me.  I like this solution because I don’t have to carry physical pieces of paper with me which I think are more easily lost–and someone can  Screen Shot 2014-04-16 at 12.35.23 PMuse to steal your identity.  I have seen several travel bloggers suggest uploading documents to a cloud services like Dropbox or Evernote so your documents are available even without a computer and on all your devices.  This can be convenient but personally I don’t trust my sensitive documents on a corporate server–although I use a variety of cloud solutions, I’m not always clear what rights these companies retain over my data stored on their servers. Furthermore, many document syncing services have been hacked and compromised.  I prefer to keep my most important documents local.  If you do this, it is important to secure a digital copy of your wallet, in case you lose the USB stick, or the computer, or wherever you’re storing the file.  I use TruCrypt, free software that creates encrypted containers to keep sensitive information.  You can even use this software to create hidden containers that only you can see (they call this plausible deniability).  When I lost my wallet in Canada, I pulled up this file and I had a complete picture of what I had in my wallet when it was lost, as well as account numbers, card numbers, phone numbers, etc. This made it a little easier to immediately call and cancel the cards, and was also very helpful in filing a police report.
  6. Get a credit or debit card with a bank that has a really good program for lost or stolen wallet situations, especially designed for travelers or expats and always travel with that card. I learned this the hard way when I lost my wallet the first time. I was living abroad in Germany but most of my cards were from the States. My banks wanted to charge me $20+ per card to Fedex my new cards to me from the US. The phone number they provided ended up being just an automatic touchtone phone system where you couldn’t actually talk to a person. They didn’t make it clear at all that not only did I need to call to cancel my current card, I also had to make an additional call to a separate number to request a new one.  Because I didn’t need my American cards urgently since I had a bank account in Germany, I opted to have them send my replacement cards to my parents’ house in the US rather than paying to have them FedEx’ed.  I went to my German bank in person to get a new ATM card, and I survived on cash until I visited my parents for the holidays and picked up my new cards. By contrast, when I lost my wallet in Canada, I had absolutely no money to pay for anything.  But because I had a credit card that was supposed to provide extra help and protections for these situations, things worked out rather smoothly.  I called the lost wallet hotline, I talked to a very friendly person who immediately cancelled the card, had a new card overnight’ed to me in Canada, and arranged for a money wire via Western Union, all at no charge to me.  The charge to wire money internationally is normally quite hefty.  They also provided free credit monitoring for six months following the incident and a free copy of my credit report. They will also refund the fee I will have to pay to get the security freeze lifted from my credit report. Finally, they offer lost luggage insurance which I used to buy some essentials for the 36 hours or so I had to go without any clothes until the airline found my luggage and delivered it to my hotel.  All my other cards didn’t offer nearly the same level of service. Within minutes of my call, I already had cash in my hand, and only a day later, I had another credit card, both of which got me through my short trip to Canada. Meanwhile, with one of my other banks, I had to wait for more than three weeks to get a new debit card.  There are tons of identity fraud monitoring services out there by now, and I imagine these companies provide even better services in the case of a lost wallet.  But you have to pay extra for these services; with my credit card the only fee I’m paying them is a rather reasonable annual fee.
  7. Keep your passport and your drivers license in separate places. Again, this is another lesson from my fist incident. I had all of my ID cards in my wallet, which I normally wouldn’t do but due to a recent altercation with a transport ticket checker who threatened to fine me for showing him my American drivers license as proof of ID rather than my passport, I was carrying my passport that day. If you’re traveling or living in a country in which you are supposed to carry your passport with you at all times, I recommend keeping a local form of ID (drivers license, student ID) along with a pixelated copy of your passport photo page. Blur the passport number, and date of birth. A copy of your passport will satisfy local authorities that you are who you say you are, or at least buy you some time to go get your real passport at home and show them.  If your wallet gets lost with a copy of your passport, thieves can ‘t easily steal your identity if they can’t see the passport number and your date of birth.  Keep an unpixelated copy of it in an encrypted file on your computer that you can easily print if you need to go to the embassy and get a new passport.  Of course, don’t leave your passport in a hotel or hostel room that isn’t secure. Put your passport in hotel safe or in a small secret locked compartment in your bag. If you don’t feel comfortable, it is probably safer on your person rather than at home. When living abroad you don’t need to be quite as vigilant with your passport assuming you live in a relatively safe building, but still keep it in a safe and secret place.
  8. Keep phone numbers and addresses of emergency contacts both in your destination country as well as back home somewhere safe as well, preferably in a different place than your walletScreen Shot 2014-04-16 at 12.40.24 PM.  You may need someone back home to wire you money, or send copies of your birth certificate if you need to apply for a new passport.
  9. I know it goes without saying, but keep your wallet in a safe place in a backpack or bag while traveling. Many good backpacks have special wallet pockets that are hidden but are still easy to get to. Additionally, don’t keep any passwords or PIN numbers in your wallet.  Rather, store your passwords and PIN numbers in an encrypted file on a USB stick or your computer, or use a password management system like LastPass.  That way, you only need to remember one master password to de-encrypt that file.
  10. Even if you’re only traveling for a short period of time, invest in a special travel wallet, such as the kind that hangs around your neck and sits close to your chest underneath your clothing rather than one that goes into a bag or in a jeans pocket.  These are much more difficult to steal or lose.  Keep your most important documents and cards there, and keep only one credit card and a small amount of cash in your normal wallet for small everyday purchases.  Switch things out between the two wallets everyday before you leave your hotel room.  If you’re living abroad, this is less a concern but I would still encourage you to only go out with what you absolutely need in your wallet.
  11. Keep an emergency calling card somewhere other than your wallet.  If you’re traveling you may not have a convenient or cheap way to call the US to cancel your cards. If you have a Skypeout or other VOIP subscription, you can call 1-800 numbers for free. If you need to use a landline in a hotel for example, you can call collect using the number on the back of the credit card.  But, if you find yourself needing to use a payphone for lack of any other option, a calling card can save money on all the calls you’ll be making back to the US.  Although it normally wouldn’t be a problem for an American to use her cell phone in Toronto without incurring too many extra charges, my particular (very VERY cheap) American SIM card did not work in Canada.  I couldn’t call to cancel my cards until I got to the hotel and used WiFi to call through Skype.
  12. NEVER EVER keep your Social Security card in your wallet, even if you never travel.  This is the one mistake I’ve never made.  If someone has your SSN, in addition to your credit cards or your passport, they can easily do you harm before you’ve even noticed your wallet is gone.  Just memorize your Social Security Number and leave the card in a safe place at home, or better in a safe deposit box.
  13. Don’t carry your checkbook with you either, especially if you’re leaving the country.  I honestly don’t know why we Americans continue to use this antiquated and highly unsafe payment method, but your checks have your account number and routing number written directly on them!  You can’t write checks abroad anyway, so just leave these at home.  If you’re moving abroad for an extended period of time, either leave your checkbook in the hands of a trusted individual or just shred the checks.  You can order a new checkbook if/when you move back.Screen Shot 2014-04-16 at 12.46.06 PM
  14. Keep an updated list of payments that are automatically charged to your credit cardsThis way, if your wallet is stolen, you can immediately inform all of the companies that auto-charge your card, and replace that information with the new card number.  I forgot about this the first time my wallet was stolen, and an important subscription service (Skype!) was interrupted.
  15. Get a credit card that uses encrypted chip technology.  This isn’t directly related to a stolen wallet, but it does help protect your financial information from being stolen.  While it isn’t common yet in the US, many countries abroad (even Canada, as I discovered), use chip credit cards rather than “swipe” credit cards.  Swipe cards are vulnerable because thieves can put skimming devices on the swipes and get your account information.  Ask your credit card company if they offer chip cards and get one before your next international trip.
  16. Keep some fake family pictures in your wallet.  I’ve never done this but maybe I’ll start.  Keeping fake family photos in your wallet might convince anyone that finds your wallet to return it to you.  I suggest fake photos because, call me paranoid, I don’t want pictures of my actual family in the hands of a thief, especially if they have my address from my drivers license.


After your wallet is lost or stolen

  1. Try to figure you where you lost your wallet or where it might have been stolen.  If you lost it in a cab, you can call the company and see if they found it.  According to a new law, you are only liable for $50 worth of unauthorized charges that take place before you cancel the card.  Theoretically, this means you can wait and see if your wallet turns up before you begin cancelling everything, and the most you can lose on your credit cards are $50 per card (this doesn’t apply to debit cards).  If you cancel your cards and your wallet is miraculously returned, you can still use your drivers license and cash if they are still there, but none of your credit/debit cards will be useful.  In fact, if you try to use a cancelled credit card, you might be flagged for fraud.
  2. If you’re sure your wallet is lost or stolen and you haven’t simply misplaced it, call your credit, debit, and ATM card companies and cancel the cards.  This is both a blessing and a curse because while no one can use the cards, neither can you until you get the replacements.  This means that unless you have a backup card, you’ll have to rely exclusively on cash in the meantime.  Make sure that in addition to cancelling the cards, you also request to have new ones sent.  Make sure that the new ones will be repinned for you.  If you only took one or two of the most important cards with you while traveling, cancelling the cards won’t take very long to complete.  If you have a backup card that wasn’t stolen, you can use that card for cash or credit purchases until you get home.  If you don’t have a backup card, ask if they can send you a new card abroad and how much that will cost.  Ask about emergency cash services and how much that costs as well.
  3. File a police report and retain a copy of the report.  Even if you lost your wallet, get a police report.  This can be especially helpful when trying to replace cards or make claims with an insurance agency, and a police report is required when applying for a replacement passport.
  4. If you have no photo identification, this can be a serious situation if you’re abroad and you will be traveling back to the US in a few days, which is why having copies of your ID cards is helpful at the very least.  If you need a replacement passport, you’ll need to contact the nearest Embassy or Consulate immediatelyScreen Shot 2014-04-16 at 12.56.57 PM.  Bring whatever you have that can help prove your identity such as photocopies of IDs and credit cards, student IDs, copy of a birth certificate, and the phone numbers of people who can vouch for your identity.  I provide more detailed information on how to get a new passport in my book.
    • If you’re traveling soon, the Embassy may grant you a temporary passport to travel back to the US.
    • You can pay an extra fee to have your new passport expedited.
    • If you’re living abroad and can get a hold of some sort of ID such as a student ID, getting a replacement passport is not as urgent unless you need to leave the country.
  5. Call the major credit reporting bureaus and put a freeze on your account, which prevents anyone from opening up a new line of credit in your name, and alerts you to any attempt to do so.  This also makes it difficult and lengthy for YOU to get a new line of credit, but you can temporarily lift the freeze, for a fee (unless your credit card will reimburse you, like mine).
  6. If you have travel insurance, call your insurance company and ask about the proper procedures for filing a claim.
  7. Change your passwords and PIN numbers as soon as possible after using your wallet.  New cards should hopefully come re-pinned.  I use LastPass to manage my passwords and for the most part, it works very well. However, in this case it worked too well because my security settings prevented me from logging into my account from any other country except the US, Germany and Spain. At least I knew that if my own password management system was preventing me from getting access to my accounts, it was doing the same to someone else in Canada.  I was able to change my passwords as soon I got back to the US.
  8. Get a new driver’s license.  This can only be done once you’re back in the US.  When my wallet was stolen in Germany, I didn’t have a drivers license for several months until I came home to visit my parents.  You have to physically go to the DMV, get a new picture taken, and pay for a new one.  You also submit the police report so the police can flag your old license if anyone tries to use it.  I was told that I could drive temporarily with my passport on me in case I got pulled over, but this policy probably varies by state.  I got a temporary drivers license, and my permanent one arrived about 10 days later.
  9. Start cancelling and replacing any other cards you lost such as library cards, membership cards, rewards cards, health insurance cards, etc.  If you had a digital copy of all your wallet’s contents, you at least know what you have to replace.  If you emptied your wallet before traveling, this is a lot easier.
  10. Think about changing the locks If you lost your wallet close to the address on your license, this may increase the chances that it will be returned but it might also encourage a particularly bold thief to steal from your home.  Think about changing the locks.

Technology to Consider

I don’t have any experience with these things, but maybe someday I’ll give them a try, considering how often I seem to misplace my wallet.  There are several companies the make small Bluetooth-enabled chips you can put in your wallet (or keychain, or computer, or whatever).  You pair the chip with an app on your smartphone, and it alerts you if the chip gets out of range from your phone.  Some have more advanced technology that give you Screen Shot 2014-04-16 at 1.06.58 PMGPS coordinates of where the chip is located.  It seems like a good idea in theory, but I don’t think there is anything that is stopping a thief from removing a chip and discarding it.  I don’t know if I really want my phone ringing every time my wallet is faraway from my iPhone, because there are lots of occasions where I don’t take both with me.

I’m intrigued by mobile wallet applications that would allow you to keep everything in your wallet on a smartphone, with the ability to self-destruct the information if the smartphone is lost or stolen.  Of course, you’d still need a backup option if your phone goes missing, and it would have to be secure from hackers.  Ideally it would also be able to carry digital versions of your driver’s license, health insurance and other important cards.  A recent article in MacWorld Magazine is specifically encouraging Apple to move forward with more innovative mobile wallet technology…one that would actually be safer than credit cards and would eventually replace physical cards all together.  I love this idea, but unfortunately we’re not there yet.

The best thing to avoid these sorts of messes that is available today are biometric wallets that require a fingerprint to open.  I’m told there are some that display a central contact number in case it is lost (since the person who found it can’t get inside to find your address or name).  But these are extremely expensive.

For now, I’ll stick to my strategy of making a digital copy of my wallet and encrypting the file.  But going through this experience twice has made me consider what I would do if I lost something with a ton of valuable, personal information; namely, my phone, computer or tablet.  Although thankfully this has never happened to me, I have been taking extra precautions lately to keep those items safe.


The trip wasn't a total bust...I managed to find my way to Niagara Falls.

The trip wasn’t a total bust…I managed to find my way to Niagara Falls.


Have you tried one of the lost wallet applications, biometric wallet, or bluetooth trackers?  How do they work?  Do you have any other advice for someone who has lost their wallet while either traveling or living overseas?  Horror stories?  I would love to hear from you in the comments.




Manufactured Spending – a Rookie’s Tale

The biggest selling point of doing college abroad, besides the opportunity to live in another culture and experience it as an insider, is the cost.  As I’ve said many times, most countries in the world do not charge nearly the level of tuition that America does, and some don’t charge anything at all.  So simply by relocating you can save tens of thousands of dollars on tuition.  And while this in my opinion is already worth it, this doesn’t mean that there are no costs whatsoever.  The first cost that most people ask about are flights.  Indeed, the cost of flying overseas at least once a year can add up.  I’ve successfully flown for cheap and even free over the course of the past seven years between various destinations and the United States, and I go into detail on how I made that happen in the book.  However, up until now I’ve never really delved completely into the world travel hacking, whereby people find ways to quickly rack up frequent flier miles without spending too much money, and then use those miles for free flights and hotel stays.  But now I wanted to go to Toronto at the end of March for a conference, but the budget simply isn’t there to afford the trip.  So I decided to give the art of travel hacking a try and see if I’m able to get a free flight to Toronto as easily as some on the various blogs claim (check here and here).

Travel Hacking 101

After reading tons of blogs on racking up frequent flier miles quickly and cheaply, I felt confident I could pull it off.  Essentially, most of the blogs out there recommend what they call “manufactured spending” to take advantage of credit card bonus miles.  Many credit cards tied to an airline offer signup bonuses that are usually enough for a free round trip domestic flight.  The catch is that in order to get the miles redeemable for a free flight, you usually have to spend a certain amount of money within a certain amount of time.  Now, if you have money in the bank or a steady income, these thresholds can be easy to meet just by using your new card for everyday expenses.  BUT some credit cards, especially those offering really enticing signup bonuses will have rather large spending requirements, and for those of us without a regular income (like potential college abroad students!), even small spending requirements can be difficult to meet.  So the travel hackers out there have devised several techniques that allow you to charge the minimum amount on your card without actually spending the money.

The Manufactured Spend

Most of the blogs out there recommend some variation of the following system to spend money on a new credit card with a signup bonus without actually spending the money:

1.  Use your card for either a Visa prepaid debit card, an Amex prepaid gift card, or some sort of reload package that allows you to add funds to an account (see next step).

2.  Open an account that allows you to use a prepaid debit, gift, or reload card to add funds.

3.  Add funds to that account.

4.  Use that account to pay the credit card bill.

5.  Use the bonus to get a free flight.

6.  Keep the card open and make occasional charges.

7.  Close the account before the annual fee comes due, or negotiate to get the fee waived, or keep the account open if the continued rewards are worth it.

Manufactured Spend- caveats

But before I go any further, a few serious caveats:

1.  Travel hacking almost always involves applying for a credit card.  This in and of itself can be a risk, since it involves a credit check and this can have a negative impact on your credit rating.

2.  Having a credit card, especially for first timers, can be tempting and risky.  It is easy to charge purchases that you don’t really have the money for, and suddenly find yourself in deep credit card debt, which is probably the worst kind of debt to have due to high interest and other fees.

3.  Only attempt a manufactured spend if you have the money to cover the expenses in case it doesn’t work out.  New cards often give you a 0% introductory rate, which you can take advantage of if you aren’t able to liquidate your purchases into cash to pay down your bill right away.  But be VERY careful.  Do your best to pay down the bill every month, even if you have a 0% rate, and DEFINITELY pay down the entire balance before the introductory rate is over.

4.  Don’t apply for a ton of credit cards at once and don’t keep a ton of credit cards open at once either.

5.  This post is not meant to recommend or endorse manufactured spending.  Most of the travel hacking blogs usually only talk about successful experiences, so I thought a rookie’s talke would be a nice addition to this literature.  I am simply reflecting on various ways to try to travel or do college abroad in the cheapest way possible, and an opportunity for you to learn from my mistakes in trying to save money on flights.  And as you will see below, my manufactured spend was not entirely successful, and therefore, follow my lead at your own risk.

Manufactured Spend- A Rookie’s Tale

So after researching the most successful techniques online for more than a month, I dove in.

Choose an appropriate credit card

First, I researched the cheapest airline between Denver and Toronto, and I discovered that the cheapest and most frequent provider was United.  So I began looking for credit card offers that involved a miles bonus that can be used on United.  Most airlines belong to a larger network of partner airlines, so you can use your miles on other airlines within that network (United is in the Star Alliance with other airlines like Lufthansa).  However, sometimes your miles don’t go as far when you use them with partner airlines.  Therefore, researching the best mileage program for the trip you want to take for free is essential.  You also want to make sure that the bonus is big enough to make it worth it.  Look at the redemption charts before signing up, so you know how far the bonus miles will go and how much more you’ll need, if any.

Fortunately, I quickly came across an offer than involved 50,000 bonus miles on United’s frequent flier program, MileagePlus.  The minimum spending requirement was $2000 in the first three months.  This is enough for a free round flight within North America, so with those bonus miles, I could get to Toronto.  The only problem with this offer is that I applied at the beginning of January, and needed to have the miles in my account to get the flight at the end of March.  This is a tight schedule to spend the $2000 in enough time to get the miles credited and use them to get to Toronto for the conference.

I applied for the card and although I don’t have a steady income at the moment, I was approved due to my rather good credit history I suspect.  If your credit isn’t great, you may be turned down for these offers.  If you think you might be turned down, another option may be to have a very trusting friend or family member with better credit apply for the card, and then have them add you as an authorized user.  (Sometimes, adding an authorized user gets you more bonus miles.  I added my mom to my account even though she has no need to use my card, and I was awarded 5000 bonus miles in addition to the 50000 offer).

Use your card for some basic spending so it doesn’t look like you’re only interested in the mileage bonus

My card arrived in the mail, and I immediately began using it for everyday expenses.  This is, of course, the easiest and perhaps most honest way to earn your bonus miles.  However, I knew I wasn’t going to spend $2000 in everyday expenses, and certainly not in enough time to get the miles credit.

The Gift Card/Reload/Bluebird Technique

So I started following the advice of the travel hacking blogosphere.  I purchased a Visa prepaid debit card through  I connected to Gift Card Mall through the online portal called TopCashBack, which gives rebates for online purchases.  The rebate was only .5%, but every little bit helps.  The maximum dollar value I could put on the Visa prepaid debit card was $500.  Unfortunately, the card came with a $3.95 purchase fee and shipping.  The total cost was $507.95.

Shortly after, I discovered that TopCashBack was offering a 3% rebate on Amex prepaid cards, and for a limited time Amex was waiving the purchase fee.  So I attempted to purchase as many Amex prepaid cards as I could to reach the minimum spending requirement.  However, Amex limited each card to a maximum value of $200, so I needed to purchase a ton of separate cards.  I’m told that there is a way to increase the limit on each card so as to minimize the amount of cards you buy, but I wasn’t able to make that work (rookie mistake number one).  A few days later, I had several prepaid Amex cards in my possession.

The next step according to my blog sources was to add a PIN to the cards so they can be used like traditional debit cards.  This was easily done through GoWallet for the Visa card, but it is impossible to add a PIN to Amex prepaid cards (rookie mistake number two).

The next thing I needed was an account that would allow me to add funds using a PIN-based debit card that also has a bill pay function.  Nearly everyone in the travel hacking world seems to be using an account called Bluebird, which is an arrangement between Walmart and American Express (and for the most part, is free to use).  I signed up for one online, and a few days later, it was good to go (no credit check required).

I then attempted to add funds to the Bluebird account using the Visa debit card.  There is a limit on adding funds this way, which is set to $100 a day.  So I planned to send $100 a day for five days until the value of the card was gone.  This worked wonderfully for the first two days, and then on the third day, I got an error message with a 1-800 number to call for help.

When I called the 1-800 number, I was informed that only debit cards that are connected to an actual bank account are allowed to be used to add funds to Bluebird, and that the account number on the debit card I was using to add funds was flagged as a gift card rather than a debit card.  The woman warned me that if I tried to use the card again to add funds, my account would be shut down.  Fortunately, however, the $200 I had transferred remained in the account, $199 of which I used at the end of the month to pay down my credit card balance (Bluebird requires you to keep at least $1 in the account to keep it active, apparently).  But now I was stuck with a $300 Visa card that I had to find a way to turn into cash to pay back my credit card bill (not to mention the American Express cards).

The blog I was following was advising people to use Amex cards (with their higher rebate and no purchase fees) to turn around and buy a Visa card, and then add a PIN number to the Visa and use the Visa to pay the credit card bill via Bluebird.  I already knew this wasn’t going to work because I had already tried to add funds using my Visa “debit”card, so it didn’t make sense to use my Amex cards to buy more Visa cards.  How people are making this work is still a mystery to me.

My rookie mistake here might have been that I opened the Bluebird account and tried to add funds to it with a debit card right away, rather than letting the Bluebird account “marinate” for a while and add some funds in a more legitimate way.  But if what the operator told me is true, the days of using Visa gift cards and Bluebird to manufacture spend might be coming to an end.  Since this was by far the most popular technique discussed by the hacks, I really wonder if I did something wrong or if Bluebird simply hasn’t caught up to them yet.  My recommendation for anyone thinking about a manufactured spend is to avoid this strategy entirely.

The Gift Card/Money Order Technique

But never fear!  The travel hacks had another suggestion if Bluebird failed.  Apparently, all you have to do is go to Walmart and use your debit card to buy a money order for $.70 to pay your credit card bill with.  However, this didn’t work for me either.  I tried to use my Visa card to purchase a money order for $275.  But, my card must have been flagged by the Walmart system (since Walmart operates Bluebird), because my card was rejected.  Rookie mistake number three.  I wonder if I had purchased another Visa debit that wasn’t flagged by Walmart if it would have worked.  But purchasing Visa cards through Gift Card Mall costs $7.95 each, and I found another way to manufacture spend that would save me a trip to Walmart and would cost about the same out of pocket, so I decided not to buy more Visa debit cards (also trying to buy high value Visa cards with my $200 Amex cards was probably going to turn into a nightmare).

The GreenDot/Visa Rush Technique

So I began a new technique.  I signed up for another account that has free bill pay and can be loaded with money via “reload cards.”  This account is called VisaRush.  Blogs that discuss this technique recommend finding a store that will allow you to purchase these reload cards such as Green Dot Money Paks with a credit card.  Apparently many stores won’t allow you to purchase these things with a credit card, and therefore it can be hard to find a store that will.  I thought I was in luck because I actually DIDN’T want to use my credit card, because I had already charged a lot on my card and I needed a way to use all of the various gift cards I had accumulated.  So I began to search for GreenDot Money Paks.

According to the GreenDot website, I should have been able to find these Money Paks at my local Walgreens.  The first Walgreens I visited didn’t have them.  After several days, I went to a second Walgreens, and there they were.  I took them to the counter with Visa debit card in hand to pay for it.  I was immediately told by the cashier that I could only pay for those with cash.  Rookie mistake number (where are we??  four??  five??).

Using Amazon payments

In the meantime, I thought I would try another technique that is talked about on the travel hacking blogs, although with much less frequency.  This one is actually the most straightforward, so I was hopeful.  It involves using your credit card to send someone money using your Amazon payment account.  You send the person the money, and they turn around and give it back to you which you then use to pay back the credit card.  But again, I didn’t want to use my card for this purpose again, because I was looking for ways to liquidate my gift cards.  (In hindsight, I should have tried this first, and used the actual credit card to send a large sum of money, rather than the gift cards…rookie mistake number six or whatever).  So I tried to use one of my AmEx cards to make small purchase online to see if it would work for internet purchases.  The charge was denied.

I called the 1-800 number on the back of the card.  The menu of options didn’t include anything involving online purchases, and so I had to sit through several minutes of automated messages before finally talking to a human.  The operator explained that internet purchases require “registering” the card, and apparently unlike the Visa prepaid debit card, you cannot register an Amex card online.  You HAVE to call, listen to the automated message go through unwanted menu items until someone finally picks up the phone, and then give them the card number, CSV code, your name, address, and phone number orally over the phone before you can use the card like a credit card online.  That is extremely annoying and time consuming, especially if, like me, you have more than a couple of Amex cards.  Sigh.

I then attempted to make the online purchase again with the Amex card.  Success!  Now that I thought the card would work much like a credit card, I proceeded to my Amazon payment account to try to use it to send money to my sister, who also has an Amazon payment account.  However, when I tried to send her the money, it was denied.  I read through the terms and conditions rather carefully and it stated that there is sometimes a hold on newly registered credit cards.  So I decided to wait a few days before sending her the money again, but I wasn’t optimistic.   I’m also fearful that my account might get flagged or shut down if I send money to someone with my same last name living in the same city as me.  I was never able to successfully use my gift cards to send money through Amazon payments.

The Gift Card Churn and Burn Technique

Meanwhile, I began yet another project to liquidate my gift cards as recommended by travel hackers.  I began to research the used retail gift card market.  There are 6 or so websites that offer used retail gift cards at a discount, and also allow you to sell your retail gift cards for cash at slightly below their value.  According to the travel hackers, if you find a card being sold at a deep discount, you can buy it and then turn around sell it back to the used gift card market for a profit.  I quickly discovered that this wasn’t going to work very well by buying used from an online market and selling it right back.  The pricing on these sites make it so that if you do this, you would actually lose a few bucks on each transaction.  This can be acceptable if you don’t lose too much on each transaction, because it helps turn your credit card purchases into cash and pay for much of your credit card purchase, but not all.  Before doing so, I did some research on the gift cards that were fetching the largest returns.  Gas cards were the highest at 92%, and Walmart was the second highest at 89-90%.  To test this technique, I used one of my Amex cards to buy a $200 Walmart card for $193, a 3.5% discount.  I would then sell the card back to the used card market (a different website, of course), for 89% cash back, or $178.  In fact, I sold the card to CardPool, through TopCashBack again, which was offering 4% cash back for each card you sell on CardPool.  I haven’t seen this rebate show up in my TopCashBack account yet, so I’m not comfortable saying that this worked, but if it does eventually, I actually earned an additional $7 on this transaction.  Excluding the rebate, this worked quite nicely (buying and selling gift cards are all free to ship) but of course it represents a loss of $15 (only $8 if I get the rebate), and it left me with an Amex card with a balance of $7.  (The smaller the balances are on these prepaid cards, the more difficult it gets to liquidate them into cash to pay back your credit card).  Furthermore, if I did a similar thing for all of my Amex and Visa cards, this would have resulted in a loss of approximately $120 (again, excluding the rebate), plus a bunch of gift cards with small balances.  Now, if the rebates show up, that price will be reduced to approximately $64.  Add to this loss the cost of the purchase price and shipping of my Visa and Amex cards, which totaled $17.  Of course, I was also using the card for everyday expenses that I was going to spend anyway, but since I got something I needed or wanted for that money in addition to meeting my spending requirement and getting bonus miles, I’m not counting that money as a loss.

While researching the gift card market, I had another thought that I haven’t seen discussed on any of the travel hacking sites I consulted.  I set up a craigslist RSS feed which alerted me whenever a gift card was posted for sale locally.  When a card was posted, I would check how much cash back I could get, using the site Gift Card Granny.  If the seller was willing to sell his/her card for a very deep discount in the hopes of getting cash fast, I discovered that in some cases I would be able to sell the card back to the used card market at an actual profit.  For example, I found someone who had received three Starbucks cards for Christmas, each worth $100.  His craigslist ad said that he really needed the money and wasn’t much of a coffee drinker, so he was willing to sell each $100 card for $70, or for $60 if someone purchased all three.  According to Gift Card Granny, Cardpool would purchase $100 Starbucks cards for 75%, or $225 (again, excluding the possible rebate from TopCashBack).  So if I bought the gift cards for $180, and sold them back for $225, that is a profit of $45 (which may increase to $54 if the rebate comes through).  Now, considering that I had to “borrow” $180 from myself in cash, arrange for a time to meet and confirm the balance of the cards, and then wait for a check to arrive from Cardpool, a profit of $45 may not be worth the trouble for some people.  This particular transaction worked well because the seller and I are were motivated and honest.  However, when I attempted a similar scheme with another person advertising a J.Crew gift card, which I could have made another $40 profit on, the seller insisted on meeting at an extremely inconvenient time and location.  I tried to get someone else to sell me their Lowe’s gift card for what would have been a $56 profit, but he demanded that I meet him right away and wasn’t so flexible.  While my first transaction worked, I’m not sure how much time or energy I’m willing to put towards this technique in the future.  I also wouldn’t go to this trouble for only a $10 or $20 profit.  I think the least you should try to make is $30 or more.  Of course, for this to work, you also have to have to cash to front the transaction (which I tend to not have since I do as much spending on a credit card and hate carrying cash around with me).

I also posted my own gift cards on craigslist just in case someone was willing to bite.  I advertised each AmEx card for $185, and said that I would negotiate if someone would buy more than one.  I figured if I got $185, this would represent a total of $75 loss if someone bought all five of the cards.  (At this point, you can tell I was getting a little panicked).  But no one contacted me, and I’m not surprised.  These AmEx cards are a pain in the ass.

While most of the used gift card sites don’t accept Visa or Amex cards (which would have made this process much easier), Cardswapper does.  However, they only offer 86% of the value.  For some, that might be an acceptable loss.  I decided to hold out on this option and use it as a last resort if I couldn’t possibly find another way to reduce my losses.  (I would have lost around $140).  At this point, I’m really questioning whether it is truly possible to manufacture spend an recover most, if not all of your credit card spending.

Furthermore complicating the issue, some of the gift cards I bought using my Visa and Amex gift cards were rejected by the used gift card sites.  I got a call from one of them asking where I got the cards from.  In a slight panic, I told them the truth.  Knowing that I was churning and burning, they sent the cards back to me.  Therefore, I had to sell them to other gift card sites.  The other gift card sites didn’t have a TopCashBack rebate, and some of them didn’t offer the same high rate of return.

I won’t break down exactly what I ended up spending out of pocket with churning and burning almost $1500 worth of gift cards, but eventually I got rid of them all and turned them into cash using a combination of used gift card sites as well as craigslist.  I was able to get about half of the $2000 before my first credit card bill was due, so I had to front myself the other $1000 before the cash slowly started to trickle in from various used gift card sites.  In addition, there was an unexpected cost which none of the travel blogs mention, is the fact that when you book your flight using miles, you still have to pay surcharges out of pocket (there is no way to use miles for these fees).  Call me ignorant, but this was an additional out of pocket expense I wasn’t expecting.  So much for “free” travel.  But considering that a flight to Toronto normally costs between $450 and $600, I can confidently say I ended up paying much less than that out of pocket for the 50,000 bonus miles.  Still however, it is far cry from getting a truly free flight, the way many travel hacking sites claim.

My conclusion

My rookie foray into manufactured spending was by no means smooth and I certainly did not end up paying nothing out of pocket.  It was also very time consuming and because I’m risk adverse when it comes to money, it was  very stressful knowing I was charging several thousand dollars on my credit card.  I have yet to check my credit score after this, but I’m afraid it might have negatively affected it, although hopefully not by much.  Because of the trouble I had with the “classic” hack techniques that seem to work well for so many others, I can neither recommend manufactured spending nor can I completely dismiss it.  Perhaps you will have a lot less trouble.

However, I think in the future I might use some of the techniques not to earn bonus miles but to save money and earn miles.  For example, all of my online spending will go through TopCashBack or other rebates sites from now on.  I will also make use of discounted gift cards more often as well.  Since I plan purchases ahead of time, I know when I’m planning to go to a certain store.  Even though it doesn’t save a ton of money, I will try to buy discounted gift cards for an upcoming purchases, saving 3% or more on every purchase, and getting cash back as well.

Now that I have the various accounts such set up such as Bluebird, VisaRush, and GoWallet, and I know better what NOT to do, a future attempt may be more successful.  But I don’t think I’ll try this again anytime soon.  I’m going to continue to be on the lookout for deeply discounted gift cards on craigslist but I won’t focus on it.  Instead, if I come across a good offer for bonus miles, I might try one of the following techniques to earn those miles:


Other possible ways to manufacture spend or earn enough miles for a free flight


I am no way endorsing the microlending industry.  A lot has been revealed lately about how it can be just as predatory as payday lending corporations here at home, but I thought I would mention it solely for the purpose of manufacturing a minimum spending requirement.  You can use a credit card to make a loan, and the repayment rate for Kiva loans is upwards of 90%.  Therefore you can have a reasonable expectation to see your money back, but it will take time, so you have to be willing to front the money.


Another similar option discussed here and there by the travel hacks is using Square to transfer money from a gift card (or more directly from the credit card) to another person, who can go ahead and transfer it back to you.  Square is a smart phone application, and when you create an account they ship you a credit card reader that can be attached to your smart phone.  Square takes a 2.75% fee for every transaction.  This could be an acceptable loss–for a $2000 minimum spending requirement this would be $55, resulting in a $55 round trip flight.  I might consider this option in the future, but it isn’t clear to me if Square would flag your account if someone you obviously know (same last name) swiped your card for a large sum or series of smaller sums.

Amazon/Ebay Selling

I sell a lot of stuff on Amazon, and less often on ebay, but I have done so in the past.  One way you could potentially meet minimum spending requirements is to buy a high value item that might fetch a high price on Amazon or ebay (Apple products are always a winner here).  This is a risky technique though.  On both forums, you’ll probably have to sell your item for a slight loss, and you also have to pay various seller fees.  On ebay, you risk not getting the price you want and on Amazon you might have to wait a very long time before your item sells.

Gift Card for everyday spending

Although I didn’t see much discussion of this on the travel hacking sites, another way to meet a minimum spend requirement would be to buy a general gift card like the Visa or Amex cards, load these cards with enough money to meet your spending requirement, and then use those cards for your everyday shopping over the course of time.  This has the benefit of meeting your spending requirement quickly, and effectively using your credit card for everyday spending without doing so on an accelerated schedule.  Of course, to do this you need to have enough cash to cover the rather high credit card bill upfront, but after that, you probably won’t use your card much for the coming months.

Time your credit card application for a large purchase

In the event that you’re planning a large purchase and saving up for it, you could attempt to apply for a bonus mileage card before you make the purchase.  Then, simply use the card for the purchase, pay it off, and reap the benefits of the bonus miles.

Arrange with a trusted friend or family member to use your card for your everyday spending as well as theirs

Use the card to make everyday purchase for both you and others, and have them pay you back with cash or check OR through Amazon payments.  For example, you could offer to pay for a group dinner on your card and have everyone else give you their part of the check in cash.  Since a lot of people are playing the points/mileage game on their credit card, a person who owes you money for something you charged on your card could send you the money through Amazon payments using THEIR credit card.  This way, they also get the credit for their spending on their card.

Look for other offers through your card to earn extra miles

Most cards have “category” spending bonuses.  For example, you might double miles for gas purchases or triple miles on dining.  By signing up for United’s dining program, I simply registered my credit card and was awarded 1000 bonus points for using the card at a participating restaurant.  You can also get additional points by spending money through your credit card’s online portal.


Are you an experience travel hacker/mileage collector?  Are there manufactured spending techniques that would work well for a young person going abroad who doesn’t have a ton of credit? 

I would love to hear from you in the comments on what you do to collect miles for free flights, what I did wrong, why the classic manufactured spend didn’t work for me, or whatever useful information you might have on this topic.