Churning Your Credit Cards: Is It Worth It?

Churning Credit Cards for free airline tickets

Credit Card Churning Defined:  The act of applying to and receiving credit cards with the highest sign-up bonus possible.  Many also have additional bonuses once you have spend a certain amount (“minimum spending requirements”).

Credit Card Churning was quite popular in the last 5-10 years.  It is still done but not as much as before as issuers have changed their policies to prevent this activity.  American Express for example, instituted a “once-in-a-lifetime” clause for obtaining sign-up bonuses per card type.

That means you can’t obtain a card, cancel the card, and then reapply hoping to get the sign-up bonus again.  Many of the banks are adopting anti-churning policies making the churning process much more difficult (and slower!).

There are four major things you need to know about credit card churning: 

1) You need lots of time and good record keeping!!  Churning airline credit cards is a time consuming process and you must keep good records to be able to track what you applied for and the overall status of the applications.

2) GOOD CREDIT.  You MUST have good credit (scores of 740+) to do this or you will be wasting your time AND will damage your overall credit scores with the increased credit card activity.

3) You don’t carry balances on your credit cards (you are able to pay off your balances every month).  If you are the person who has balances on your credit card month-to-month, you should not be churning.

4.  If you plan to buy a house or car (or boat, or other big ticket financed item), DO NOT CHURN for at least 18 month before you begin applying for your big loans and churning WILL hurt your loan chances.

Each time you apply for a credit card, the issuer will pull a copy of your credit report (a “hard pull”).  In my case, I have had two “divisions” of the same issuer pull separate credit reports before which really hurt.  Too much activity on your credit report can negatively affect what you are trying to accomplish.

“Soft Pull” — an inquiry for advertising and promotional offers; you are reviewing your own file; or employers view your file as part of background checks (this is usually BUT NOT ALWAYS a soft pull).

“Hard Pull” — an inquiry from a company who is interested in lending money to you (ie: credit card).  Only a hard pull will affect your credit score, and too many of them will definitely affect your ability to obtain credit.

For example, you should not apply for more than 3 new cards every 90 days.  90 day breaks are enough to push the “inquiry” dates far enough away to make it look like you aren’t trying to accumulate too much debt.  And you should apply for the cards on the same day.  Most people don’t believe that is a benefit — but I think that you have a greater chance of your issuer NOT seeing the pulls from the other applications if they do it about the same time.  To me, it is better than nothing!

If you want help keeping track, there is an excellent spreadsheet you can download at

Spreadsheet to help keep your credit card churning actviites clear and safe!

As part of this “record keeping”, you are monitoring a variety of items, including when the annual fee will be due.  In most cases, you will receive the “first year fee” waived, and will want to cancel the card before the second year fee is due (about 11 months after receiving the cards).

To dive into this and become the person pursuing 30 credit cards is beyond the scope of this post; and truthfully, beyond the scope of my knowledge.  My churning has been limited to targeted and specific cards for pre-planned trips.

A good example would be the real-life example of travel-by-points availability I posted.  In that summary, I found that one round-trip ticket to London from Lax would only cost me 40,000 points on American Airlines — 20,000 less than all the other carriers.

So I looked for cards that earned American Airlines cards and found that it was restricted to CitiBank (points directly transfer into AA).  I also noticed that there were two credit cards programs that provided 30,000 – 75,000 bonus miles when you were approved.  Both had minimum spending requirements, but the 30,000 bonus program had a very reasonable $1,000USD spending requirement in the first three months.

The Easy Plan?  You apply for a card; and the person you were planing to go with applies.  After acceptance, you both have 30,000 and need to work on earning the last 10,000 miles through spending.  From this point forward, until you have met your goal of 40,000 miles each, both of you put all your purchases on this card — this becomes the “goto” card for all purchases.

If you have a small business, you can also apply for the business card and obtain another 30,000 miles.  The important thing to consider — it is possible to fly free!

Can you apply for the same card again after cancellation?  Yes — but only after you wait TWO YEARS after cancelling!  Churning CitiBank cards has changed.

But we have another idea:  Apply for the American Express Starwood Preferred Guest Card and get 25,000 bonus Starpoints after the $3,000USD minimum spend in three months.  Those 25,000 Starpoints will DIRECTLY TRANSFER to American Airlines mileage program 1:1!

Or if you are traveling alone and want to go to somewhere else that American Airlines flies, obtaining these two cards would earn you 55,000 to 100,000 miles with only two applications!  Not a bad deal if you space it out correctly and make SURE you meet the minimum spending requirements.

These deals are out there — but they change often so search for “credit card airline bonus”.  Plan where you want to go on rewards; determine how many miles will be needed, and then implement your plan to earn miles.  It can be done — and you can fly free anywhere in the world if you want!

Churning reward cards is NOT dead — but it is substantially more difficult.


PS: How to meet minimum credit card spending requirements:

In previous years, many people met the minimum spending requirements by using “manufactured spending”.  The market has changed so much and has become so difficult that I chose not to include it in my example.  If you have time, search “manufactured spending” and you will find dozens of sites with information. HOWEVER, look for posts with an updated date within the last 90-120 days!

Quickly, “manufactured spending” allowed you to buy gift cards and refill cards with credit cards and liquidate the cards, getting 95% of your money back.  [That is a pretty simplistic explanation].  Most of these opportunities are gone.

The last technique that comes with some costs such as “credit card convenience fees” is “PAYING FOR THE SPEND”.  This technique allows you to use your credit card to pay your taxes and other items, but makes you pay a “convenience fee of 2-4%”.  Look at this page for a list of companies that allow you to pay any bill with a credit card.

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