Churning is Dead; Here’s What’s Next

Once upon a time you could sign up for the same credit card every couple of months and rake in hundreds of thousands of points in the span of months.

This is what was known as “churning.”

Even though some people now use that term to describe heavily pursuing credit card rewards, churning at its core had an element of rapid turnover.

It was about waiting months to get the same card — not years. 

On top of the churning opportunities, there were opportunities to meet minimum spend requirements that did not even incur costs and required very little time. 

For example, people could purchase coins at the US Mint and meet their minimum spend requirements (on top of earning tons of additional miles).

Then there were all of these different avenues with prepaid cards that allowed people to purchase gift cards and liquidate them in an effortless fashion.

If you had a $5,000 minimum spend requirement, you could literally just load purchases onto a prepaid card and you would be done in seconds.

People could rinse and repeat with this and meet tens of thousands of dollars of minimum spend requirements in a weekend.

So with a couple of trips to a grocery store and perhaps a Walmart or Target you could essentially fund a first class trip to pretty much anywhere in the world.

It was crazy.

But then things started to change.

First, a lot of those “manufactured spending” opportunities dried up. They simply got too popular and eventually went away.

Then, we started to see more restrictions on earning bonuses and even getting approved for various cards. These rules popped up with major issuers like Chase, American Express, Bank of America, and Barclays.

At first, some rules only applied to a select few cards.

For example, the Chase 5/24 rule initially only applied to Chase house cards for a while before moving on to select co-branded cards and then to all Chase cards.

The Amex once per lifetime rule did not initially apply to business cards.

So we started to see more widespread adoption of stricter restrictions.

And along with that we started to see extended waiting time periods for eligibility. 

People had to now wait 18 to 24 months to receive bonuses again or get approved and eventually even wait 48 months.

There has also been a clamp down on gaming with banks shutting down accounts.

Banks like American Express added anti-gaming language to their terms and conditions and started to use their discretion when offering bonuses based on the activity of the customer.

All of these changes made it much more difficult to hit credit cards going 100 mph like you could do in the past, and I know my personal strategy has changed a ton. 

Over the past few years, Brad and I have taken a couple of pretty extravagant around the world trips (using miles and points to fund the flights and hotels almost exclusively).

Our first around the world trip in 2016 required around 1,000,000 miles while our much bigger trip in 2018 required around 2,000,000 miles

Earning the miles for those trips was honestly not that difficult but in 2020 it definitely would be much more difficult.

And that is one of the biggest changes that has occurred.

In 2020 and beyond, credit card rewards is about a more methodical and long-term approach where you use precision and patience to fund your travels rather than going crazy to apply for as many valuable cards as you can.

It’s about seeking out bonuses and earning them at an opportune times for specific types of redemptions and optimizing your spend.

If you are like me and like to use your points for business class or first class flights then you need to keep tabs on all available bonuses and go for those bonuses efficiently so that you don’t waste any time.

For example, there are still ways for you to pretty quickly earn a few hundred thousand points in a hurry that could get you very far with your travels. 

You could jump on a card like the Chase Ink Business Preferred and the Chase Sapphire Preferred and come out with 149,000 Ultimate Rewards points from only two cards (after meeting the minimum spend requirements of $5,000 and $4,000).

That would be enough to transfer points to United for a round-trip in business class from the US to Taipei — a value of $5,000+.

And then you have offers like the limited-time Delta offers, offering up to 80K miles — enough for a business class flight from the US to Europe. 

So there are still great opportunities for you to quickly get outsized value for your travels.

The difference is that if you want to do this on a repeated basis you need to follow the anti-churning rules the banks now have. 

These have longer wait times of 2 to 4 years so “churning” is no longer an option.

Instead, you need to be more patient and you need to keep tabs on your eligibility in an efficient way.

But that means keeping tabs on a lot of different rules (that also tend to change over time).

And this is what I believe the new app WalletFlo does best.

WalletFlo is not just a tool to help you get approved for credit cards, but it is a response to a shift in the way that credit card eligibility is headed. 

As more restrictions come in, eligibility is going to get more time-consuming to keep up with which means it will be harder to earn more bonuses. 

If you fail to consider one rule, that could force you to miss out on big future opportunities.

For example, if you were not aware that Citibank has different rules for each of its American Airlines cards, you might not realize that you could get each one of those cards which could end up costing you tens of thousands of miles. 

But if you have a roadmap like the one WalletFlo offers then you will see when those opportunities will arise for you to earn all of those miles. You’ll also be able to optimize your points with spend which for some people can make a pretty dramatic difference. 

A lot of people seem to be dismissive of the value of optimizing your spend on different categories.

Sure, the value does not compare to welcome bonuses but those 4X and 5X earning rates can add up very quickly. And in some cases by putting a lot of spend on your card, you can also trigger retention offers which can lead to even more points.

These are all things that WalletFlo is working to help you with, so you will be much less likely to leave miles and points on the table. It’s never going to be quite like it was several years ago but I do think that WalletFlo will help you get as close to the gold era as possible!