Buying groups: Big risks / big rewards | Ep223 | 10-7-23
Oct 7, 2023
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The podcast discusses the benefits and risks of buying groups for credit card spending. They also touch on loyalty statuses at Caesar's, extending Marriott free night certificates, airline status match offers, and maximizing rewards with buying groups. They delve into the risks and controversy surrounding buying groups and share personal rules for decision-making.
Joining a buying group can lead to big rewards and benefits, allowing users to easily meet high minimum spending requirements for credit card welcome bonuses and earn substantial rewards in the process.
Additional stacking opportunities, such as shopping portal points and bonuses, can further increase the rewards obtained through buying groups.
Individuals should exercise caution when participating in buying groups, conducting thorough research and only investing what they can afford to lose to mitigate potential risks and financial loss.
Deep dives
Overview of Buying Groups
Buying groups are communities or companies that aim to purchase products at a discount and resell them for profit. They offer a way for individuals to spend big on credit cards and meet minimum spend requirements quickly. Members of buying groups contribute their purchases to buy products in larger quantities, allowing for bulk discounts that wouldn't be possible for an individual. The main advantages for members are the ability to earn rewards on their credit cards while contributing to the group's purchases and the potential for significant profits.
Big Rewards and Benefits
Joining a buying group can lead to big rewards and benefits. It allows users to meet high minimum spending requirements for credit card welcome bonuses easily, earning substantial rewards in the process. The group's bulk purchases often qualify for category bonuses on certain credit cards, multiplying the rewards earned. In some cases, users may make a profit on their purchases, adding to their overall rewards. Additional stacking opportunities, such as shopping portal points and bonuses, can further increase the rewards obtained through buying groups.
Potential Frustrations and Risks
Although there are potential rewards, there are also risks and frustrations that come with buying groups. When dealing with merchandise, there's a risk of items being lost, damaged, or stolen during transit. This can result in financial loss for members if the buying group doesn't assume responsibility. Additionally, dealing with large volumes of products and shipments can be challenging and increase the potential for complications. Other risks include the potential for scams or fraudulent behavior by certain buying groups, as well as unexpected closures or bankruptcy, leading to financial loss for participants. Individuals should be aware of the risks involved and only participate with what they can afford to lose.
Lessons from Past Instances
Past instances, such as the case of the Plastic Merchant buying group, highlight the importance of caution when participating in buying groups. Some instances have resulted in financial loss for participants due to sudden closures or scams. Members should conduct thorough research and due diligence before joining any buying group. It is advisable to start small and gradually scale participation based on personal comfort level and experience. Taking precautions such as ensuring shipments or diversifying participation among different groups can help mitigate risks.
Risk and Consequences of Participating in Buying Groups
The podcast episode highlights the risks and potential financial consequences of participating in buying groups. The host shares personal experiences of deals gone wrong, such as a concert ticket deal where buyers were promised a commission on top of the ticket cost. Due to low demand and falling ticket prices, buyers were not paid as promised, resulting in financial losses for some participants. The episode emphasizes the importance of being cautious and not investing more money than one can afford to lose in such ventures.
Ethical Considerations of Reselling and Buying Limited Quantity Items
The podcast explores the ethical implications of reselling and buying limited quantity items, such as concert tickets and hot toys. While some argue that reselling drives up prices and limits availability for genuine fans, others see it as a natural product of supply and demand in a free market society. The hosts discuss the gray areas and individual comfort levels when it comes to reselling and highlight the importance of personal values and consideration for others in making ethical choices.
Buying groups can be a highly effective way to increase credit card spend and earn big rewards, but they can also be a perilous path toward problems. Greg and Nick discuss what they are, why you might want to use them, and why they may not be right for you.
1:12:34 Question of the Week: I got the Citi Premier card and forgot to meet the spending requirement, so I never received the bonus. If I close the card and apply new, would I be eligible for the bonus?
Music credit: Annie Yoder
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