Question: If I buy a EE bond with a face value of $5,000 for a purchase price of $2500, how is the interest on this bond calculated?

Is it based on the face value (3.96% * $5,000) or is it based on the purchase price?

$2,500

Has somebody charged the purchase of Savings Bonds with the Amexco SkyMiles Credit Card in order to get 2 SkyMiles for 1 dollar?
Or is the purchase of Savings Bonds exempt of the 1 $ to 2 Miles exchange?

I have purchased US Savings Bonds on the card three times when they have offered double miles: late last year, during the month of June and currently during the July 15 to August 15 promotion period. Although they cap the number of bonus miles one can earn, it is still a very good mileage generator.

I don't think so from what I just read
on a credit card info website:

Two (2) miles for every dollar ($1) spent at stand-alone grocery stores, gas stations, drugstores, Delta Airlines, home improvement stores, the U.S. Postal Service, or when used to pay a wireless phone bill.
Read Terms and Conditions for more details.

So unless a lot of your purchases fall into those categories, most of your miles will be one for each dollar. A nice thought, though, if they'll ever let you do that.

Yes. I've done it in the past and just purchased $20k in bonds for the current promo. The remaining $15k for my annual limit is going on my UA/MP Visa card to take advantage of that promo. 40k DL points, 30k UA points, adequate interest on the bonds since the money is currently in money markets at ~1%. Not bad http://www.flyertalk.com/forum/smile.gif

There's a DL/AMEX promo from 7/15 to 8/15 for double miles on all purchases.

Also a double miles on United Airlines Visa, but you have to register (1-800-359-8252 ).

According to AMEX customer service the maximum bonus allowed on the double mileage promo is 20,000. I bought 10k of bonds, but anything over that is 1-1 miles.

Thanks to all.

And yes, you also have to register at American Express in order to get the double SkyMiles until August 15, 2002.

http://www10.americanexpress.com/sif...41,9316,00.asp

I don't think that's how it works. If you buy $10k in bonds (or whatever) you get your 10k DL points for the actual purchase plus 10k more as bonus. You are counting the actual purchase value into the bonus total. You should be able to buy $20k in bonds and thus receive 20k "bonus" points as wells as 20k points for the purchase. Please correct me if I'm wrong on this http://www.flyertalk.com/forum/smile.gif

Just got off the phone with a supervisor at AMEX to find out that you are correct. Spoke to two people at AMEX yesterday before buying my bonds and was told that 10k was the max. to get the bonus of 20k. Wish these people knew what they were doing!!!

There is enough evidence (this forum and others, even the government web site) that purchase of savings bond against a credit card is considered a "purchase" and not cash advance.

Last week I bought savings bonds using SkyMiles AMEX card. As of today, the charges have not appeared on my account. When asked, I am told that these charges have been "authorized" but have not been presented yet for a payment, so the funds are locked but not paid yet.

Fine...but

when I inquired about mileage accrual, I WAS GIVEN A SHOCK.

The CSR told me that these purchses are considered "cash advances", will be charged 3.5% transaction fee, will not earn miles, and will start interest from the day charged. when i asked for a supervisor, ALL WERE BUSY. She was pretty confident about her answer, so I did not argue.

Someone please tell me she is wrong!!!

She is wrong! All of my recent purchases have posted as purchases. Call back and speak to somebody who is more knowledgeable.

Here's what my statement reflects:

SAVINGS BONDS DIRECT304-480-6112
XXXXXX SAVINGS BONDS DIRECT

She is (fortunately!)

WRONG, WRONG, WRONG!!!

If you look on the Govt website, I believe it can even be found there. I'm certain if you get someone who is the slightest bit in the know at the CC company, you can work around this minor problem. Just play CSR roulette until you hit on someone who appears to know the skinny, and get their name/phone #/company identifier or whatever else you need and you should be fine.

Best Wishes.

I'll tell you too, that she is wrong. I've bought them before in smaller demoninations (I and EE bonds) but only recently in larger demoninations to earn frequent flyer miles. It's a purchase, not a cash advance. A cash advance is going to a bank and getting cash from a credit card, sticking it in an ATM and getting cash, or using a service such as Western Union's cash transfer service. All these transactions have the word "cash." Buying savings bonds is a purchase. Either for yourself, or as a gift (I have purchased bonds as gifts too). They're not cash, but an IOU from the Federal Government. You can't get cash them in for a minimum of six-months, anyway, so U.S. Savings Bonds don't even fall under the category of "cash."
Also, Series EE Bonds are now also called "Patriot Bonds." How patriotic would it be for a bank to charge you a cash advance fee, a higher interest rate, plus interest starting from the day of purchase until the day you pay it off, for you being patriotic for purchasing these things?

question about cashing the patriot bonds after 6 months,can we do it in any bank?can you give me some bank names where we can cash them.what would be the total interest for 6 months for 10000$
396$-198$(penalty for 3 cashing before 9 months)can someone explain this please

As I have stated elsewhere, when AMEX first was added as a credit card option, it was pulled temporarilty because they wanted to treat it as a cash advance. The govt made it very clear that that was not their purpose for bond putchases - that people borrowed money to buy them. It got settled, and AMEX was added back in. So it is AMEX's aggreement with the US govt that these bonds be treated as purchases. I received e-mails from the US Savings Bonds dept in regard to this. Every purchase (AMEX Starwood) has been treated as a purchase. Why don't you wait a few days, check on-line - probably you will see it correctly handled.


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Ms.DtG

Bring them to a teller at your local bank, and they should be able to deposit the proceeds into your bank account with no problem. If you don't have an account with the bank, I believe they can limit the amount of bonds you can cash, which I think is $1,500. Yes, there is a three month interest penalty for cashing the bonds from six months to five years from their issue month/date (printed on the bond). There is a calculator on www.savingsbonds.gov, which you put in the face value of the bond and the issue date, and it will tell you what they're worth, including computing any interest penalty.

Which type of bond should one purchase if they are planning on cashing it in 3-months: EE or I?

It is hard for me to tell a real difference between the two. Why should I choose one over the other?

Thanks for your help!

You cannot cash either in 3 months - the minimum is 6 months. For a 6 month horizon, I would go with the EE Bonds - they have a higher current interest rate, and probably will the next adjustment period.

So if you need it in 3 months, don't do it - but otherwise the EE should be better short term.

Probably just pick the one offering the higher interest rate (although rates change every six months). But the way inflation is, the EE bond rates should be exceeding the I bond rates for the immediate future.
Only other consideration is your credit limit and how much you wish to buy. EE bonds are limited to $15,000 of purchases per individual per year, and I bonds you're limited to $30,000.
Also, you have to hold them for six months until you can cash them. But buying them near the end of the month (but don't wait until the last few days), should get you an issue date for that month with interest starting from the first of the same month. So buying near month-end, theoretically you could hold the bonds for five months and a couple of days before you're allowed to cash them in.
One other bit of advice. Make sure you're not carrying a balance on your credit card from the previous month. The way Citibank computes interest (probably similar to AMEX), if you have a continuing balance, some large purchase (like $5,000 worth of bonds), will immediately increase your average balance, and could result in large finance charges you didn't expect. So make sure the account is paid in full for the previous billing period and the billing period you're purchasing your bond in.

Great advice. Thanks everyone!

I was trying to purchase savings bond using my corporate AMEX card from the website. I got a message that the card could not be authorized. I tried other (personal) card and it worked fine. When I called the customer service rep, they mentioned that the purchase is coming thru as "retail purchase". I also tried for the lowest denomination of savings bond but the amount of the bond did not make any difference. Also, the available credit limit on the corporate card was enough for the purchase of bond(s). So credit limit was also not the problem.

I have used corporate card for some other personal purchases and have never defaulted on my payments. This was the only time I had trouble using the corporate card for personal expense. I'm using corporate card becoz my personal card does not have enough credit line and plus I would like to get Membership Rewards.

Did anyone of you had the same experience? Any thoughts on how can I get around this problem. Is there any way I can purchase these bonds over the phone and have AMEX CSR on the second phone line.

Thanks in advance.

Using a corporate AMEX to buy personal US savings bonds sounds like a fool-proof recipe to get fired. Hope that won't be the case here, but the miles are not worth risking your job.

Not necessarily. Depends on the policy of the individual company. At some places, the employee gets REIMBURSED for business expenses and pays the Amex bill him/herself (rather than the company paying the Amex bill). There isn't anything wrong with using the card for personal expenses, as long as the company isn't billed for them!!! The bottom line is, you must familiarize yourself with your company policy and follow it. (I don't at present have a corporate cc of any type, but did have one several years ago and this is how it worked.)

Kathy

Even if your corporate AmEx is set up with the bill going to the employee, you should still be very careful to read the fine print regarding non-business purchases on the card; I've had corporate AmEx cards with many different employers, and in every case non-business purchases were prohibited; as corporate budgets get tighter, it's more and more likely personal purchases will get flagged. My two cents...

What's the point of having a corporate AMEX if you have to pay the bill yourself first?
(show of hands everyone, who has a corporate AMEX, not discover, visa or mc, but an AMEX, that does not get paid directly from your company?) Sounds more like a personal card at that point. Sure, if you have bad credit and/or are a foreign worker, you may not qualify for a personal CC and your company has to "sponsor" your credit card, but this is probably an extreme example.

"What's the point of having a corporate Amex if you have to pay the bill yourself?" Well, for one thing, the annual fee is paid by the company and not by the employee. Believe it or not, there are still apparently corporate Amexes where the employee (not the company) pays the bill!

Kathy

I work for a rather large fortune 10 company. We get the bill sent to us but they pay the bill when we fill out our expense reports. We used to have to pay the Corp AMEX charges ourselves. They want us to justify the charages and it has to be approved before the bill is paid.

Christian

Christian

I've had problems with purchases over the internet not being authorized because the address I'm trying send the purchase to, and the address on my credit card account is different, even slighlty. Sometimes I have to check my bank statement to make sure I'm entering it in exactly as they have it, or the purchase may not get approved.

Not unless you own the whole corporation. One must then fire themselves for using their card not correctly.
But, seriously, I have a corporate travel card (issued by Citibank). The bank sends me the bill, which I must pay myself. I must submit documentation for reimbursement. My employer won't get bent out of shape if there is some small purchase there that they don't understand in which I paid it immediately. Buying $10,000 in U.S. Savings Bonds on the card is another story. I don't think I'm going to try that.

As someone responsible for the Corp Card program at our company let me clear up the AMEX issue:

1. AMEX has a T&E program and a CPC (Corporate Purchasing Card) program

2. T&E can by Individual or Corp Liability cards. Most companies choose Individual. Employess pay for travel expenses etc. Submit expense reports and pay their own bill. The advantage to the company is they get a rebate from AMEX each year on the total volume of charges while not being on the hook for the bill itself.

3. CPC cards are always corporate liability and are used to lower the cost of procurement for companies. These are not travel cards. Most companies use these to purchase everyhting from copier paper, office supplies to computers and software.

4. So when someone refers to their Corporate card they most likely have a T&E card.

Sohu,

What's happening is that the merchant (in the case the US Treasury I suppose) is being asked to phone AmEx and verify your identity, by asking you for a driver's license or the like. Obviously that can't happen for an online transaction, so it's treated as a failed authorization. AmEx customer service reps will insist till blue in the face that the charge was not "denied", but if you can't use the card it's a distinction without a difference.

They *can* do something about it, but there's a good chance the first rep you speak with will either insist that there isn't, or more likely insist that there's no problem. What they need to do is have an authorizer in (I think) the credit department enter an override in the system so that the authorization will be approved automatically without an ID check.

Get to the screen where you've entered your card number, then call AmEx and square things away. When they tell you it's taken care of, click "pay" and ask them to hold on just a few seconds until the charge goes through.

Keep at it until your problem is resolved. Sometimes, it seems, they only begin to help in earnest once they see that helping is going to take less time and effort than convincing you that they can't.

--ss

SS,

Thanks for your suggestion. I'll try doing that next time.

Fellow FTers,

I do get billed for my Corp card every month. And my company has no problem if I use the card for personal expenses as long as I do not default on my payments to AMEX. I just submit my T&E with travel and other work related charges to the company (with merchant receipts, etc.) which gets paid after verification. Obviously I don't enter my personal charges on my T&E.

Regards,
Sohu