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Credit Card Churning: How You Can Save $6,000 Every Year of Travel

What is Credit Card Churning?

If you’re not familiar with the practice, the practice of churning is to sign up for new credit cards to get the promotion points or miles. You move onto another as soon as possible to earn points, and then close it immediately or before the annual fee is charged.

Click here on how to open a credit card.

Won’t This Hurt Your Credit Score?

Yes, only in the short-term. When you open up a new credit card, you take a hit to your credit score of about 10-25 points, which bounces back in 1-2 months. Even if it does hit your credit score, there is not much of a difference between a 750 vs. 800+ credit score in terms of getting approved for a home, car, and other bank loans and credit card applications.

Despite having applied to three new cards over the last month, my credit score only dropped by 7 points.

Tips for Credit Card Churning

1. Have enough spend to meet the minimum spends

You will need to several thousand dollars in just a few months to meet the spending requirements. If your expenditures aren’t high enough to meet the minimum spending requirements, you won’t get the sign-up bonuses, and will typically need to wait another 2-years (depending on the credit card) to obtain another sign-up bonus for the same card.

Tip: Move your monthly expenditures forward. If you have monthly gym membership or insurance payments, inquire about an annual fee. Many insurance companies, gyms, and membership programs will let you pay for 6-months or a year up front. You may even get preferred pricing and a discount for the lump-sum payment.

The minimum spend requirements are usually posted when applying for a card.

2. Have enough spend to meet the minimum spends

You may not want to churn credit cards if you’re preparing for a mortgage, car, or another major loan within the next 2 years. The number of inquiries and opened accounts can affect temporarily affect your credit score and make it harder to get approved for new accounts.

3. Keep Track of all Your Cards

The hardest part about credit card churning is usually keeping track of all the cards and points. Usually people keep a spreadsheet of which cards or open, how much spending needs to be done, and when the 3-month promo is up. You can also record the annual fee date so that you can close before the anniversary.

Tip: I personally use a website called Award Wallet, which is free for 6-months. There are a few other websites that keep track of your miles and points, but Award Wallet has compatibility with the most number of reward programs. You can join Award Wallet here.

Award wallet is a great way to keep track of your frequent flier and hotel membership accounts and points.

4. Using the Whole Household

For a typical credit card, you are only eligible for bonus promotions once every two years. But in my household, there are three adults, including me (myself, mother, and father). For the Citi® AAdvantage® Platinum Select® card, we can theoretically take advantage of the sign-up bonus three times.

Tip: Credit card sign-up bonuses are limited by individual, as opposed to your reward program membership number. For instance, what I do to pool all the airline miles or hotel points into one place is to use the same airline or hotel membership number for my whole household’s cards.

5. Doubling Down: Business Cards Anyone?

Business cards are not the same as regular personal cards! If you applied and received bonuses for the Citi® AAdvantage® Platinum Select® personal card, you can apply for the business one and receive the sign-up bonus for the business card.

Tip: You do not need to have a small business to obtain a business card. Just simply use your social security number in place of the Tax EIN number.

Chase has a great selection of business cards that offer excellent sign-up bonuses.

6. Get the Chase cards first

Chase won’t approve applications for customers who’ve opened more than 5 new credit cards within the past 24 months. Therefore, when churning, always get the Chase cards first to start the countdown on the 24-month rule.

  1. Chase Freedom
  2. Chase Freedom Unlimited
  3. Ink Business Cash Credit Card
  4. Ink Business Preferred Credit Card
  5. Chase Sapphire Preferred Card
  6. Chase Sapphire Reserve
  7. Chase Slate
  8. Southwest Rapid Rewards Plus Credit Card
  9. Southwest Rapid Rewards Premier Credit Card
  10. Southwest Rapid Rewards Premier Business Credit Card
  11. Southwest Rapid Rewards Priority Credit Card
  12. United MileagePlus Club Card
  13. United MileagePlus Club Business Card
  14. United Explorer Card
  15. United Explorer Business Card

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