Note: I owe a huge hat tip to PDX Deals Guy for telling me over and over why I should do this instead of just cashing in my money!
Discover Cash Gift Card Reselling
One of the greatest joys in life is taking something and making it grow. We do that with money by investing it and children by feeding them, but rewards are a different beast. In fact, rewards generally go the opposite way. Over time they become LESS valuable due to devaluations.
Of course cashback rewards are a bit different. For example, Discover Cashback earned is worth the equivalent amount of U.S. Dollars. You can get them to mail you a check or simply redeem your Discover Cash as a statement credit. But what if there was a way to make it worth 10% more? Well, there is and I just did it with $2,000 worth of Discover Cash.
Discounted Gift Cards
One nice thing about Discover Cash is they give you an option to redeem it for gift cards. Why take gift cards instead of straight cash? Because they often give you a discount of 20% or sometimes even more!
The key though is that all gift cards are not created the same. For example, look at the screenshot above. Athleta cards can be sold for about 80% these days if your lucky. If you cashed in for those, then you would do a lot of work for nothing and other cards would be huge money losers. But then there are the occasional good cards. The $25 iTunes cards at 20% off is a good example of a card that might be a winner. There are others. Believe me.
Cashing In a $200 Profit
One of my Discover cards recently received its year end doubling and I had over $2,000 worth of Discover Cash sitting there. After searching the Discover site to find which gift cards were available, I settled on purchasing 50 of the $50 Nike gift cards for $40 in Discover Cash each. The total came to $2,000 in Discover Cash and the cards were at my door within a week.
After receiving the cards it took awhile to peel them off of the backing they came on and to remove the glue and the strip above the PIN code. For 50 cards it took me about 20 minutes of prep plus another 20 minutes to submit them to a company I sell to. If you factor in research and ordering time, let’s just say the whole process took about an hour. (I did use a Scotty Peeler and barcode scanner to move a little quicker.)
The Math
Since I was able to sell the cards for 88% of face value, I essentially earned $4 per card. The math works out like this:
- Cost: $2,000 Discover Cash
- Payment Received: $44 X 50 cards = $2,200 Real Cash
- Profit: $200 Real Cash
For about 60 minutes worth of work I earned $200 (10%) more than if I had just redeemed my Discover Cash for a statement credit. Not bad.
Conclusion
Beyond Nike there are other gift card deals that may be worth pursuing so make sure to take a look at their site to find opportunities. I do admit that I was not going to do this at first, but after looking at the math I am glad I did. While it did take a little time, I think the payoff was large enough to justify the effort.
Have you ever juiced up your Discover Cash by gift card reselling? Please share your experiences in the comments!
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[…] since they often give you better than the $.01 cash value. For example, a couple of months ago I covered how I redeemed my Discover Cash for Nike gift cards at 20% off. I then re-sold those gift cards for a profit. See my original post for more […]
@spencer
if you use “the internet” you can do more (i.e.$2k). takes about 12 seconds…
This post is solid though, if you have the time and patience,
however you may create tax issues as you should be reporting any profit.
Slightly off-topic, but since you mentioned the year-end doubling, have you had success churning Discover cards? Is there some time limit between canceling out a card and getting a new one that allows you to get the 1st-year doubling again?
Thanks!
Unless something has changed very recently you can have up to 2 Discover cards open at a time and to get a second one the first needs to be open for at least a year.
why you didn’t get staples gc
Compare this to cash deposit to your bank. Discover limits that to $199.99 per day and the phone call takes about 5 minutes. To redeem $2k, you would have to make 11 phone calls over 11 days at a total time spent of about 55 min. No profit this way, unlike this post.
I tried to do it on eGCs and wasn’t able to resell, note to self, next time I’ll just get the cards mailed instead of using the eGC
How do you know which cards have the potential of being sold easily and with max profit?
Perhaps it’s obvious with iTunes vs Athleta, but if you have to choose, say , between Banana Republic and Gap? How do you decide?
Is there a resource that can help you compare and decide what’s worth your effort?
GiftCardWiki. Then do the math. Won’t give you bulk rates though.
BR and Gap gift cards are interchangeable and as such are usually around the same rates, which is 70-79%. My guess is without a bulk seller relationship the best option are the Staples $25 gift cards which can be sold four 84% online to ABC/Cardcash and I’m guessing something similar for SaveYa. That would leave you with a 4% profit plus not needing to deal with statement credits. They’re electronic so you can wrap it up in less than an hour from start to finish.
I mentioned this route to you a while back when you were touting the BR card promo. Why the sudden interest?
I tend to write about things I have recent experience with. I wasn’t claiming to invent the wheel and wrote about it now because I had just sold the cards. Thanks for pointing it out back then and for commenting and contributing!