Spring Rolls and Loyal3

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Spring is springing around here.

Nettles and dandelions are poking through my raised beds. Grasses are stubbornly shooting through the cracks in between my patio bricks.

There is a strange yellow orb in the sky where the clouds used to be.

The air is warm and redolent with Pollen and other allergens.

And the miles game is undergoing a rebirth as well.

I have been seized by new energy and I’m trying out a bunch of different new manufactured spending approaches. I am breathing life into the way I play miles game and learning new skills.

And this is (honestly) my favorite part of the miles game. This fitting together of all of the pieces of the puzzle. The research and reconnaissance. And the thrill of executing something small for the first time.

It’s all immensely entertaining. And it stimulates many of the brains same pleasure centers as shopping and gambling.

What’s so amazing is that not only does it not cost anything but it actually pays big bucks (miles!)

So I’ve got about three new angles to share with you, but I want to iron out all of the wrinkles before sketching them out here.

Suffice it to say these approaches are quite exciting and filled with promise. (So you should definitely stay tuned.)

In the meantime I’d like to give you an update on my loyal3 experiment.

Here are the steps and timing of the workflow.

Step one: sign up you and your spouse for loyal3 accounts.

This only takes a few minutes.

Step two: sign-up to buy $50 orders of every single stock available on both accounts on a monthly basis.

This probably takes a good 15 to 20 minutes.

Loyal3 makes it easy to buy one or two stocks but difficult to place a bunch of orders at once. My sense is that this is intentional in order to dissuade people from taking advantage of the free credit card purchase of stocks angle.


Nice try loyal3.  We laugh at your deterrence.

One thing to be cognizant of during this step is that each time you place an order for a stock, loyal3 will default to a bank transfer as your preferred method of payment. You must manually switch it to credit card payment each time.

Step three: call your credit card company and let them know that you will be placing multiple $50 orders so no fraud alerts are triggered.

This will allow the purchase transactions can go through without a hitch.

Step four: wait for the transactions to go through.

This usually takes 2 to 4 days from the time of your order.

Step five: after a predetermined amount of time(I usually wait three business days) sell all of your Stocks.

This takes about 10 to 15 minutes.

Step six: wait 2 to 4 days for the shares to be sold, and for the money to credit to your account.

Step seven: once the shares have been sold note any big losers.

My cut off is one dollar (or 2%) lost. Make a list and write down these stocks.

Step eight: cancel your next monthly order for your stocks that have lost significant money so that you can harvest these losses.

You will buy them once again in two months to avoid the “wash sale” rule which prevents you from harvesting the losses.

Step nine: transfer balance to your linked bank account.

This will take another two or three days.

Step ten: rinse and repeat the following month.

I’ve gone through two such cycles now (one for both me and my wife,) and we’re about $35 up with $20 worth of tax losses harvested.

It’s worth noting that we could easily be $200 or $300 down by this point. My suspicion is that over time we will come out slightly ahead. But it’s crucial to note that this is money that we can afford to lose.

Each cycle takes a minimum of seven or eight days and usually more like 13 or 14 days with my three day waiting period before selling.

The process is not seamless, but it’s not that hard.

And, of course,  the one great unknown that I will not be able to address until next winter is how much of a challenge it will be to file my 1099 come tax time.

There are certainly easier and less risky ways to accumulate credit card charges, but I enjoy this angle and will keep it going as long as Loyal3 will let me.

Any questions or thoughts on the process?  If so, please leave comments.

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5 Responses to “Spring Rolls and Loyal3”

  1. Mo June 2, 2014 at 11:32 pm #

    this is very juicy. I’m gonna get online and look into setting up an account.

    • Miles Dividend M.D. June 3, 2014 at 4:28 pm #

      Nice Mo,

      Maybe I should have called this post Loyal3 and xiao long bao (juicy pork dumplings)!


  2. Robert June 3, 2014 at 8:42 am #

    Alexi, I’ve been digging into the tax situation. I’m no tax expert so don’t hold me accountable, but…I think we have good news. According to http://www.irs.gov/instructions/i1040sd/ch02.html, it looks like you can just report the aggregate amounts in your Sched. D–PROVIDED THAT (a) Loyal3 reports 1099-B amounts to the IRS, and (b) no wash sales occurred or adjustments to basis are needed. So it may not be that bad, provided Loyal3 does things right. Hopefully your $1 limit is what Loyal3 follows too; if they round off differently, then I suppose you might have some wash rule violations and then have to do things the hard way.

    • Miles Dividend M.D. June 3, 2014 at 4:28 pm #



  3. Sebastian June 4, 2014 at 4:49 am #

    Great to read this Alexi. And how much SPENDING do you generate per month with this? As much as you need on each new credit card to get the bonus?

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