People are always finding new ways to game frequent flier programs, and a lot of people are learning this week about a very clever one. Several national media reported this week on a phenomenon CreditCards.com reported back in April: Some travel addicts use airline credit cards to purchase U.S. dollar coins, which are shipped for free from the government. The consumers then go to the bank and deposit the coins, and use them to pay off the credit card bill. They are getting enough in credit card rewards to get free flights, but they aren’t actually paying for it.
According to an NPR report this week, “their purchases from the Mint contribute to a huge and growing buildup of one-dollar coins in Federal Reserve vaults.” A 2005 act of Congress directed there to be more dollar coins minted even though there just wasn’t the demand for them. The program where you can order the coins directly from the Mint was made so that more of the coins would go into circulation, but these frequent travelers are causing them to do the opposite.
Mint spokesman Tom Jurkowsky tells NPR that they first caught on to the funny business in 2008, when they noticed that a small group of customers kept ordering hundreds of thousands of dollars of coins. They also learned that some of these frequent travelers showed up at banks with the coins still in their packaging. Jurkowsky says while it isn’t technically illegal, it’s an abuse and violation of the system. The Mint sends letters to the worst offenders, and set up a restriction that only 1,000 coins can be bought every 10 days. NPR says that as long as credit card issuers don’t intervene, people will continue to game the system with their airline rewards credit cards.
What do you think? Is this a fair way to get frequent flier miles? I do find it a little immoral in the sense that you’re messing with the U.S. Mint and getting free flights that you didn’t truly earn. Then again, if you’re clever enough to pull off this travel hack, maybe it’s worth it.
Read on for my roundup of my top 10 favorite personal finance blog posts from the past week!
1. My Dollar Plan discusses the trend of boomerang children — young adults who have to move back home with their parents — and offers tips for how to co-habitate with your parents and work out financial issues.
2. Budgeting in the Fun Stuff lists some of the top sites you can use to save money, from finding free couches to buying cheap airfare.
3. Len Penzo debates the pros and cons of married couples sharing their finances versus keeping them separate.
4. Consumerism Commentary explains why it’s possible for you to have excellent credit but still be denied a mortgage.
5. Family can either be a huge help or a huge hindrance when it comes to getting your finances in order. Debt Free by 30 discusses the different types of family members you will encounter on your journey to get out of debt.
6. Many of us leave money on the table without even realizing it. Bucksome Boomer lists many things you should be sure to do to bring in more cash, like using the right credit card and mailing in rebates.
7. It’s easy to blow through money when you go out often as a family. Barbara Friedberg Personal Finance provides users with five ways to have a cheap family night out.
8. The Financial Blogger uses an anecdote to explain why it’s important to start organizing your finances in your 20s and offers tips on how to get started.
9. Still looking for a job? Cash Money Life gives some counter-intuitive advice on how to boost your job search: begin volunteering.
10. Money Reasons offers several great ways to get creative with your saving and keep your spending under control.
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