Yes, you can buy gift cards with credit cards. It’s not just a convenient way to pay, but it can also help you maximize your credit card rewards. However, there are a few things you need to know before heading to the nearest retailer. Let’s dive in and find out when you should and shouldn’t buy a gift card using your credit card.
How to Buy Gift Cards with a Credit Card
Buying a gift card with a credit card is as easy as purchasing any other item online or at a physical store. Simply choose the gift card you want and use your credit card as the payment method.
If you’re at a physical store, pick the gift card you desire, go to the cashier, let them know the amount you want on the card, and inform them that you want to use a credit card for payment. For online purchases, select the gift card, enter the desired amount, proceed to the checkout section, and provide your credit card information.
Where Can You Buy a Gift Card with a Credit Card?
You can buy gift cards with credit cards at most major retailers and restaurants. Some retailers not only offer gift cards for their own establishments but also provide options for other stores. Small businesses and restaurants usually have gift cards available exclusively for their own establishments. Additionally, online retailers and marketplaces offer gift cards for a variety of retailers.
Which Gift Cards Can You Buy with a Credit Card?
You should be able to buy any gift card with a credit card. There are two types of gift cards:
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Open loop: These gift cards are broad and usually issued by financial institutions like Visa or Mastercard. You can use them for any purpose as long as the retailer accepts payment from the gift card issuer. For example, if you have a Visa gift card, you can use it at any retailer that accepts Visa.
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Store-based: Gift cards specific to retailers can only be used at the establishments mentioned on the card. Some may allow you to use them at multiple store branches, but generally, you won’t be able to use a gift card for a clothing retailer at a local restaurant.
When Should You Purchase Gift Cards with a Credit Card?
To Lock in Rewards or Discounts
Purchasing gift cards is similar to buying other items, such as clothing or food. If your credit card offers rewards—whether it’s points towards travel or cash back on purchases—it’s wise to maximize your benefits whenever possible. This way, the next time you buy a gift card for a friend’s birthday, you can earn perks for yourself too. You can also take advantage of rewards offers by purchasing gift cards and using them later.
When Taking Advantage of Promotional Offers
Some rewards credit cards offer sign-up bonuses when you spend a certain amount within a specified period. Buying gift cards can help you meet these requirements. Additionally, if your credit card offers bonus earnings in rotating categories each quarter, you can purchase a gift card at a retailer falling under that category and earn more rewards. For instance, if your card offers 6% back for purchases at home improvement stores, buy a gift card from such a store to earn the bonus rewards.
Reasons Why You Might Not Want to Buy Gift Cards with a Credit Card
When Stores Have Stricter Purchasing Rules
While most retailers allow you to buy gift cards using a credit card, some may not. Smaller businesses may restrict the use of debit cards only or decline payment from certain credit card issuers. Others may require identification before allowing credit card purchases.
You Won’t Receive Credit Card Rewards
Although gift card purchases may seem like regular purchases, some credit cards do not count them as such. Credit card issuers have caught on to cardholders using gift card purchases to earn rewards. Therefore, they have stipulated in their terms that gift cards may not be eligible for rewards. Furthermore, some issuers may limit the number of gift cards you can purchase. Violating these terms could result in the loss of rewards or even the closure of your credit card account.
What Are the Best Credit Cards for Purchasing Gift Cards?
The best credit cards for purchasing gift cards depend on your needs and where you spend the most money. Generally, the Blue Cash Preferred® Card from American Express is a great all-around card, offering unlimited 6% cash back for purchases from certain U.S. streaming subscription services and U.S. supermarkets. Many supermarkets sell gift cards, allowing you to maximize rewards whether you’re buying groceries or gift cards.
If you’re a regular shopper at Target, the Target RedCard is an option that offers discounts on gift cards. While this card can only be used at Target, you can get 5% back on in-person and online purchases at Target, including specialty gift cards.
Gift Cards That Function Like Prepaid Debit Cards
If you have an open-ended gift card, which may be reloadable, it functions like a debit card. You can use it for purchases at any retailer that accepts the card network. Keep in mind that these cards may charge a purchase fee, so ensure you’re comfortable with the cost before proceeding. Credit card companies may also have restrictions on the number of gift cards you can buy, and some may impose daily limitations. Therefore, if you plan to buy multiple open-ended gift cards, you may be disappointed.
Does Purchasing a Gift Card Count as a Cash Advance?
In some cases, purchasing a gift card with a credit card can be classified as a cash advance. This means you might be charged cash advance fees and incur a higher interest rate on your credit card. Prepaid or open-ended gift cards typically fall into this category. Before making your purchase, check with your credit card issuer to understand the rules or consider purchasing gift cards alongside other items to reduce the likelihood of it being treated as a cash advance.
TIME Stamp: Buy Gift Cards Strategically
Buying gift cards with a credit card can be a smart way to earn rewards, but it requires careful planning. Make sure to read the terms and conditions of your credit card to avoid rule violations or having your purchase coded as a cash advance.
Frequently Asked Questions (FAQs)
Can you purchase a Visa gift card using a credit card?
Yes, you can purchase a Visa gift card with a credit card, although some issuers may treat it as a cash advance or impose other restrictions.
Can you buy a gift card from Walmart with a credit card?
Yes, you can buy a gift card from Walmart using a credit card. Walmart offers a wide selection of gift cards, with at least 34 currently available for shipping on their website.
Can you use a credit card to buy a $500 gift card?
Most likely, you’ll be able to purchase a $500 gift card with your credit card. However, always check your credit card’s terms to ensure the transaction falls within their guidelines and won’t be treated as a cash advance.
Can you use a credit card to buy an Amazon gift card?
Absolutely! You can use your credit card to buy an Amazon gift card. Amazon’s website offers a selection of over 1,000 gift cards across 11 different categories.
The information provided here is independently created and not affiliated with the TIME editorial staff. For more information, visit our Personal Finances Blog page.