The rule of 2 reasons

A reader asked me the other day on the time it took me to accumulate all of my points in April.  I think it is a very legitimate question that I don’t think I fully know yet.  I think when I’m done with the AMEX $20K Reselling challenge, I’ll have a better understanding of it.  Actually, I can give some real numbers on my reselling time right now.  Every day for the past week, I spend 30 minutes unpacking, labeling, and re-packing packages to ship to Amazon.  There are some days I begrudgingly do it, but it needs to be done if I want to ‘make money,’ right?  If you’re the type that lets the dishes pile up before doing the dishes, then reselling may not be for you.  Let’s come back to this though.

Bluebird/Serve/RB Loads

I have a Walmart and a Target on my way to work.  When I decide to stop there before work, I get into work 15 minutes later than normal.  I have to ask myself what I would have been doing in those 15 minutes at work.  If I would have been talking to my coworkers about Taylor Swift’s ‘Bad Blood’ music video, then I consider that pit stop a net positive ROI (Return on Investment).  Now if I was a lawyer and billing clients $600 an hour, then clearly that pit stop was a net negative ROI… well unless I was able to bang out $4K of loads/MO’s using a 5% card in those 15 minutes.  But you get the picture.  For the most part, I value that pit stop as extra money in my pocket.

Now, at night, when I am already cozy in my pajamas, it’s a different story.  It usually takes me 30 minutes to drive to a Kroger and buy more gift cards.  I have to ask myself if it’s worth my time to do that because the most I can buy at Kroger these days is $2K per trip; thus my net profit with a 5% card and 1% fees is $80.  That means I have to ask myself if the time at home with my wife is worth more than $160/hour, which it is 99% of the time (the other 1% is when she’s mad at me.)  For you, it may be different.  If you have kids and a big family, you may value your time at home more.  If you’re a single guy, then it may be worth it for you to make that drive.  However, there is a caveat to this…

The rule of 2 reasons

Back in college, my roommate and I were pretty lazy, and we were mostly home-bodies.  Then one day, I forgot who came up with it, but the rule of ‘2 reasons’ came up.  The rule is simple – if you want me to leave the house, give me 2 reasons unless it’s a very compelling reason.  For instance, if I need to go return something to Best Buy, that’s not enough of a reason to leave the house.  But if I also need to buy a birthday present, then that’s 2 reasons for me to leave the house.  Now if I was starving and all we had was Gatorade in the house, then that’s one compelling reason to leave the house.  This rule of ‘2 reasons’ has followed me through adult-life and even into this MS hobby.  For instance, there is a kate at a Walmart 40 minutes away from my house.  There are also 2 Walmarts nearby as well.  In a good week, when kate is functional, I can bang out $10K on that 3-4 hour trip.  The problem is sometimes kate is down, or you get that cashier that says, “No prepaid cards,” which then makes that trip A TOTAL WASTE OF TIME.  That’s why I only make that trip once a month.  And I decide on which weekend to go using the rule of 2 reasons – “What other store can I stop by up there?  Oh there is a Kohl’s there.  Oh a Target is nearby too.”  You get the picture.   So now you guys understand how much time I spend per month MS’ing for cash.

It now begs the question – if I can MS at $160/hr, then why don’t I do this full time?  Well, I know people who do this full time, and you have to think about how BORING it must be.  The same stores…the same cashiers….the same ripping off cards…typing in PIN codes.  Eventually, you get burnt out right?  Or worse, the store shuts you down because you’ve been doing too much volume.  Therefore, this is an inherent limit on how much you can MS in a given month.  That’s where reselling comes into play.

Reselling Time

The thing with reselling is that it’s very much like MS opportunities.  It may take you hours finding what to buy to net you the highest profit margin, but when you find it, you GO ALL IN ON IT!  I must have sold over a 100 Nutribullet’s from Kohl’s when they had 20x UR.  The only reason I stopped was because a) Kohl’s eventually put a 5 per household limit on it b) Chase stopped paying out 10X, and c) eventually people caught on and started doing it too, thus lowering my profit margin.  Doesn’t that sound familiar?  Then you spend hours finding the next item, and when people start doing it too, you move on to the next.  Usually, you have a ~3 month window before the peloton catches on.  The great thing about reselling is that you can do it from your pajamas.  Take a picture for ebay…pajamas!  Pack boxes for Amazon…pajamas!  Schedule a Fedex ground pickup…pajamas!  So this is why I don’t mind reselling as much as MS.  I maybe only do 1/10 the volume as I do MSing, but other than signup bonuses, this is the easiest way to accumulate miles.  You’re not going to MS on your Alaska Visa card at 1X.  If you are, you’re doing it wrong.  I can buy and resell $1,000 worth of stuff through the Alaska portal at 8X in less time than you can MS 8K points using your Alaska Visa card.

Conclusion

I MS for cashback; I resell for points.