Usually when investing, I use money back ("shop with Amazon points") when purchasing already nicely discounted items. For example, I used $14 Amazon points when purchasing Jabba's Palace last Spring when it was $87 before points. This maximizes cost savings to the fullest.

How do you feel about using points when buying items when they are slightly overpriced? For example, I can get a recently retired set for $10 more than it's "ebay going rate" ($120) but I have $58 in Amazon points to offset the higher than liked selling price. In this case, my purchase price would be w/in close striking distance of it's original MSRP.

Your thoughts are welcomed.

The way I think about these kind of thing (points, rewards, cash back) is: from the moment they are awarded to me they become part of my "regular" capital, so I don't really discount them when purchasing anything and that makes me continue to look for the best deals.

 

For example, say I have $ 10 in Amazon points and want to buy 1 Orc Forge for $40. In my calculations I consider the amount invested the whole $40 and not only the reduced amount because of the points (in this case $30)

 

If I were in your shoes, I would not be able to consider the points as a $ 58 discount, so I would go directly to eBay to get it instead of Amazon. Don't know if I explained myself well lol.

I am sort of in line with FC's point. I think about it slightly differently I guess. First it depends on where you are getting the points from. If you do a ton of Amazon buying, then I would tend to agree that it is basically capital similar to a gift card. If you buy mostly Lego to get the bonus points, then I consider it more realistically a discount spread across all items I buy. It's really like an additional 3% off (in Amazon's case) across all of your set buys, you just apply the discount on a single item. If that makes sense.

The way I think about these kind of thing (points, rewards, cash back) is: from the moment they are awarded to me they become part of my "regular" capital, so I don't really discount them when purchasing anything and that makes me continue to look for the best deals.

 

For example, say I have $ 10 in Amazon points and want to buy 1 Orc Forge for $40. In my calculations I consider the amount invested the whole $40 and not only the reduced amount because of the points (in this case $30)

l.

Great example...

So the Orc Forge cost you $30+$10 in points ($30 gets billed to your credit card) and you consider the entire $40 as cost, what does the $10 saved classify as? I know you typed regular capital so I assume you mean, it is like having an extra $10 in your wallet...

The way I think about these kind of thing (points, rewards, cash back) is: from the moment they are awarded to me they become part of my "regular" capital, so I don't really discount them when purchasing anything and that makes me continue to look for the best deals.

 

For example, say I have $ 10 in Amazon points and want to buy 1 Orc Forge for $40. In my calculations I consider the amount invested the whole $40 and not only the reduced amount because of the points (in this case $30)

 

If I were in your shoes, I would not be able to consider the points as a $ 58 discount, so I would go directly to eBay to get it instead of Amazon. Don't know if I explained myself well lol.

 

This is how I treat it. Just extra capital - not free money.

Great example...

So the Orc Forge cost you $30+$10 in points ($30 gets billed to your credit card) and you consider the entire $40 as cost, what does the $10 saved classify as? I know you typed regular capital so I assume you mean, it is like having an extra $10 in your wallet...

 

Yes, those $ 10 I treat just as I would cash in my wallet. Basically my point is this: when you use the $ 58 in points to get your $ 130 item that sells for $ 120 on eBay at the end of the day you are still spending $10 more than you should have.

 

This is how I treat it. Just extra capital - not free money.

 

We agree on that!

I think you have better options for how to invest that capital.

I mostly use my points to reduce the cost of sets that I want to build. Like a 9515 Malevolence. I want to build it, but not enough that I'll pay $95. So I get one with a damaged box from warehouse deals on amazon for $81 and throw $21 in points at it to book it as a $60 expense. Or a 10228 HH for $38 (threw $100 points in), or a couple of battle packs for $5 each. If I happen to pass on a set, and then decide later that I have to have it, I would throw some points at it to get it near retail, if I want to build it.

I don't typically use them to reduce my cost basis on an investment set, though I have done so just to achieve round numbers sometimes (like 2 Unexpected Gatherings for $100 instead of $111.46)

Not all points are "free money" but the amazon card really is (no fees, free money to spend on amazon), so I do tend to use them for things I may not use my own dollars for on that particular day. That's just how I look at it. The additional capital perspective is also valid. I could use the points to buy paper towels instead, so it is no doubt real money, but I'm mostly in this to build cool sets with the family.