By: Revanche

Credit card churning: a plan!

September 11, 2015

or in ye olde Fatwallet lingoe: App-o-Rama! The last time we did this was for a handful of cards at once, in 2013, before our wedding.

We just finished the minimum spend ($3000 in 3 months) for a United mileage card earning a 50K mile bonus but we need at least another 40K miles to book flights for the family so I’ve lined up a second United mileage card with another 50K mile bonus. It’s taking forever to reach us. *taps foot impatiently*

I’ve also decided to make this an actual routine rather than taking it as our trips are dreamed up. My nerves can’t take wondering if we’ll hit the right number of award points or miles in time to book before the awards rooms or flights run out.

Our regular large expenses that can be charged on a card are mapped out in a spreadsheet so that we can line up our cards for churning against our regular, required purchases so we don’t find ourselves “needing” to spend oohhh say $500 just to hit the bonus and find ourselves the proud and chagrined owners of, I don’t know, some ridiculous thing we wanted. Right, that’s not likely but one can get caught up in the chase for awards.

I’d love it if we could charge our property taxes but I’m pretty sure the city or county still charges some silly non-insignificant percentage if you pay by credit card and that narrows our profit margin on the bonus too much to be worth it.

Instead, we have regular auto, property, and life insurance policies that come due in the fall and the spring. In fact, one just came in the mail! Hello, bill. Also food. We eat a lot of food. Food will go a long way to meeting our quota.

Leigh & Mrs. Crackin’ raised excellent points in the comments: look for cards that waive the annual fee for the first year and don’t pay with CC over cash unless the rewards are overwhelmingly profitable.

9 Responses to “Credit card churning: a plan!”

  1. Churning would be so much easier if I could use CC’s to pay my mortgage. I’m probably going to start again soon though (maybe October once my refi is done) so my partner and I can rack up points for a 2017 international trip.
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  2. Linda says:

    I’ve never been tempted to use this approach for miles because it just seems way too complicated for me to keep track of. The closest I came to doing something like this was meeting a special Discovercard challenge that ran from December through April and earned me an extra $500 cash back bonus. I do use my rewards cards all the time, but they are simply cash award cards and not mileage cards. How do you keep track of when to close the accounts so you don’t get hefty fees?
    Linda recently posted…Thoughts on love and personalityMy Profile

    • Revanche says:

      Spreadsheet! I like to track what I’ve applied for, what rewards are associated with it, what’s required by when, and the cancellation date on one sheet. Then on another, I keep track of the bills that should be paid for using the cards so that I can time the applications to match. And like Leigh, I only apply for cards that waive the annual fee the first year.

  3. Leigh says:

    I only decided to start doing this because I can put all of my grad school tuition on a credit card, so that’s one new credit card every 3-5 months or so, which seems reasonable to me. My plan is to just get cards that have the annual fee waived for the first year and then if we don’t end up using the points, that’s okay because it didn’t cost me anything!
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    • Revanche says:

      Yep, definitely the cards with the annual fees waived for the first year. There’s only been a couple cards where I didn’t have that but the value of the miles I earned there was well worth the $150 I paid in fees (used to redeem an approximately $1000 flight).

  4. I’m typically too cheap to pay any bill with a credit card if there is an additional fee for doing so. I won’t pay our electric, gas, or daycare bill with a credit card because of the fees. I did check it out at the daycare when they begin accepting credit card payments and they told me the fee was $5.00. Maybe I should ask again! I pay it once month so if I could get away with a $5.00 additional fee maybe I should go for it…..

    I did pay our property taxes one year ($2,600) and I think I paid an extra $50 or something. It was well worth it because I didn’t have anything else going on and it was a cash back card where I earned $500. So it was an easy subtraction $500 – $50. Mentally I have trouble paying extra for points even though I know the value can be there.

    Oh, I enjoyed your links yesterday. I think I got distracted and left before I even left a comment!
    Mrs. Crackin’ the Whip recently posted…Pimp the grocery budgetMy Profile

    • Revanche says:

      Totally fair – I do the same. The profit from miles / points / cashback has to be a LOT more than the fee I’m paying so I won’t pay most things that add any CC use fee because it doesn’t come out to be worth it. The property tax though, you make a great point, I might have to run the numbers on that to see if it’s worth running on the card when we have a bonus.
      And yay, glad you liked the links! It’s nice to have the validation that it’s worth doing them 🙂

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