Credit cards Charge your savings bonds to a credit card to earn a valuable bonus - Brief Article

Kiplinger's Personal Finance Magazine, May, 2001 by Joan Goldwasser

Go into debt to buy savings bonds? It sounds like heresy, but there's method to this madness. If you buy bonds with a credit card at the government's Web site, you can rack up any perks your card offers. For example, charging $25,000 worth of bonds on a MilesOne Platinum MasterCard from Capital One can get you a round-trip ticket to anywhere in the contiguous U.S. That's on top of the current 5.54% yield on EE bonds or 6.49% yield on I bonds.

Unfortunately, the Bureau of the Public Debt (www.savingsbonds.gov) limits each transaction to $1,000. But you can make multiple purchases. Web purchases are considered merchandise transactions, so they qualify for perks offered by Visa, MasterCard and Discover. (You can't use American Express.)

Low-interest premium cards Best if you carry a balance

                                RECENT    CASH-ADVANCE   ANNUAL
ISSUER                          RATE(*)   RATE/FEE(c)     FEE

Pulaski Bank & Trust (G)         7.99%    7.99%/none      $50
USAA Savings Bank (G,P)           9.50     9.50/none       45
Simmons First National (P)        9.95     9.95/none       50

                                 LATE/        TELEPHONE
ISSUER                        OVER LIMIT        NUMBER

Pulaski Bank & Trust (G)        $20/$20      800-980-2265
USAA Savings Bank (G,P)         20/none      800-922-9092
Simmons First National (P)      20/none      800-636-5151
No-fee premium cards Best if you usually pay the balance each month

                              RECENT    CASH-ADVANCE     GRACE
ISSUER                        RATE(*)   RATE/FEE(c)     PERIOD

Security First Network (G)     9.90%      9.90%/2%     25 days
Wachovia (G)                   9.90       19.99/4      20 days
Capital One Bank (G,P)         9.90     19.80/2.5      25 days

                                LATE/       TELEPHONE
ISSUER                       OVER LIMIT      NUMBER

Security First Network (G)    $15/$10      800-736-2321
Wachovia (G)                    29/29      800-842-3262
Capital One Bank (G,P)          25/25      800-548-4593
No-fee premium cards Best if you usually pay the balance each month

                            RECENT   CASH-ADVANCE      ANNUAL
ISSUER                      RATE(*)   RATE/FEE(c)         FEE

Amex Cash Rebate (P)         18.49%     21.49%/3%        none
Fleet Cash Rebate (P)         14.99       19.80/4        none
First USA GE Select (P)       15.90       19.99/3        none

                            REBATE      TELEPHONE
ISSUER                       TERMS        NUMBER

Amex Cash Rebate (P)        up to 2%   800-467-8462
Fleet Cash Rebate (P)       up to 2%   800-394-0472
First USA GE Select (P)     up to 3%   877-533-9656

(*) As of March 9; rates are adjustable, often tied to the
prime rate.

(C) Cash advances often have no grace period;
additional fees may be charged.

(G) gold card

(P) platinum card

SOURCE FOR LOAN RATES AND CREDIT CARDS: Bankrate.com, N, Palm
Beach, Fla.