This forum needs a "like" button

Payday Loans and MS, oil and water ?

I'm actually in that situation. I'm self employed as an independent contractor service professional. It's normal in my line of work for clients to take months to pay. I'm currently floating about 7k. When the statement closes for personal cards, or when the payment due date comes for business cards, I MS on another card and pay off the one that's due. I just need one or two clients to pay, and then I pay it all off.

It's basically a cheaper way of taking a cash advance from your cards. It's more of a budgeting tool. Actually that's the line I use when somebody asks me why I buy these cards.

The way I see it is that MS needs discipline, and if you're taking payday loans at those high rates you might be lacking that discipline and is forced to get loans at those rates. So like one poster said, they are totally different kinds of people, Oil vs Water.

Been floating money with MS now for a couple months now. Works really well and the only real limit is how much you can get into a Serve/Bluebird/Target/etc prepaid card per month.

I actually had been doing this for a while. It is great way to borrow money without the fees/interest. Floated about $10K (bb/serve, amzn payment, AFT) for 2 years instead of taking out a loan. And at the same time get at least 10,000 pts/miles every month for "borrowing" the money. I say at least 10,000 miles because for the longest I was buying VGC with ink ($5000/month so 25k UR) and loading bb/serve at WM. It is such a crazy concept of getting paid (pts/miles) to borrow money at 0% interest. It's not easy and extremely stressful and risky because if MS were to die/stop, then you are basically screwed. It was pretty much a job, and forcing myself to MS 10K every month to pay off the previous month's bill (most of the time JUST being able to make the payment by due date). As of today, I have paid off my "loan" and relaxed a bit on the MS ^ (because many MS options are dying!) and just enjoying the hundreds of thousands of miles I have accumulated! :cool:

Also, I would not recommend doing this in today's environment, unless you are doing like $1-2K/monthly or can pay it off if MS were to stop one day.

this makes no sense. what kinda service is this where you don't get paid upfront or at the end? and assuming you've been doing this for a while, and this aint your first rodeo -- why are you in $7k debt to begin with? you'd think past profits and savings would hold you over for a new contract/client.

slow clap for the person who clearly doesn't know what he's talking about. most GC fees are an effective 1% loan, so not 0. and since you're using Ink that's effectively a 2.5% loan.

$1-2k/mo LOL ok bud. this forum reallyyyyy requires some kinda entrance test.

Ink is 2.5% fees (back then with Visa Savings Edge) - we both agree here. But I get 5% CB essentially if I were to turn my UR points into cash. I am now up 2.5% in profit for every $200 vgc I bought back then. But I rather keep the UR points and redeem it for 3-4x that value. But you can essentially redeem the UR points for cash and hedge your fee costs and maintain that 0% interest or even net a profit.

Also, for using other CC's, all cc's essentially give you 1% cash back thus it negates the gc fees.

I apologize for this assumption because I thought this is an MS thread and that this was kind of like given that cc gives at least 1% cashback. MY BAD. you are right. this forum needs an entrance exam.

cept that's not what you did. you "accumulated 100s of thousands of UR points" for presumable future redemptions. so you paid the 2.5% fee.

so what you're saying is that you like running around in circles like a hamster to buy and liquidate GCs just to end up in the same spot every month? surely there are much easier ways of making/floating money with that time, for a net profit like you like to say :)

and no NOT all CCs are 1% CB cards.

I guess it's perspective. You see 2.5% fee, I see saving money on my vacation. At the end of the day, I am saving money overall (netting a profit). I don't look at it like paying a 2.5% fee because I would/did redeem it for 3-4x its value when I go on vacation. So 15K UR gets me 1 night in Andaz Costa Rica which costs $500/night. Even better of a redemption since I am Hyatt Diamond. If I am going to go on vacation there anyways, instead of paying $500, I am using 15K UR ($150 Cash value), I save myself $350/night. So instead of using my UR pts to negate the fees, I am "transfering my vacation funds" aka a portion of the $350 that I saved to pay for the fees and in the end I am profiting since I saved money on my vacation.

Fortunately, my office building is very close to a walmart, target, and fee free atms. And there is a staples along the way as well. But now you can just order VGC online anyways. So didn't really take a lot of time; I go during lunch. And I do not liquidate to end up in the same place every month. As a result of the MS, I was up $10K in cash, which I used to invest in something, and after two years, as a result of my investment, I net a profit which I used some of it to pay off this $10K amount that I have been floating. I am sure there are many other ways to float money; but getting paid to do it? I do not know of any other at this moment. Care to share your ideas?

You are right, not all CC's are 1% cashback. You must be the only person on the entire flyertalk using one of those credit cards.

Scary thought.....Payday loans and MS. And I had thought not being able to float MS funds was bad

You may want to let go of trying to rationalize your opinion here. You're just digging deeper and looking more like you have no clue. zzrayzz has pretty much laid out how it works and the %'s.