I use to, but then I calculated how much money/value in dollars I was gaining from it, divided by the number of hours I was spending on CC portals and on the churning subreddit and general...
I use to, but then I calculated how much money/value in dollars I was gaining from it, divided by the number of hours I was spending on CC portals and on the churning subreddit and general management and realized that if it was a part time job, I wouldn't do for that hourly rate. So I stopped.
I still funnel all purchases through CCs, but I just keep a few nice ones with good cashback rewards.
Same. I know people who really enjoy the CC equivalent of extreme couponing, but to me it's not worth it. I have an Amex card that I've held for almost 10 years that I pay down to zero about once...
Same. I know people who really enjoy the CC equivalent of extreme couponing, but to me it's not worth it. I have an Amex card that I've held for almost 10 years that I pay down to zero about once a week. I treat it like a debt card. And they give me 1-6% cash back on stuff. I have some insane $30,000+ limit on the card because they keep automatically increasing it hoping I'll use it. Not a chance in hell. I don't think I've ever had a balance higher than $4000, and that was after making a large single purchase which I then paid off immediately.
It's like $95 a year or something. Before we got it the wife and I calculated that we would recoup that cost just from the cash back on gas in about 7 weeks. The 30k limit is rediculous. When we...
It's like $95 a year or something. Before we got it the wife and I calculated that we would recoup that cost just from the cash back on gas in about 7 weeks.
The 30k limit is rediculous. When we first got the card the limit was something like $5k. I have never asked for a limit increase, but they keep periodically increasing it the longer I'm a customer and a few times after I've made very large ($1000+) purchases.
To be very clear: I will never, under any circumstances charge that much to that card. The interest would be insane, and anything that expensive should be saved for or be financed via a bank loan. And if the bank won't finance it, that should be a very large neon sign that I shouldn't buy that thing.
insert disclaimer here about emergencies like medical expenses because fuckit you're going bankrupt anyway, and also how fucked up US medical financing is
It's not precisely a points or signing-bonus scheme, but we've been using a Chase Sapphire rewards card for large planned purchases that we've already saved cash for, like moving expenses or major...
It's not precisely a points or signing-bonus scheme, but we've been using a Chase Sapphire rewards card for large planned purchases that we've already saved cash for, like moving expenses or major appliances.
Pay the bill with the card, pay the card with saved cash, and effectively get a greater return than we would have keeping the cash in a standard savings account.
It was a huge deal when the company I used to work for stopped allowing people to collect personal travel points from corporate expense credit cards. I just started paying for my business travel with the Chase card and holding Corporate's feet to the fire on legally mandated reimbursement turnarounds. In a busy year, I could get to that $30,000 you mentioned quite easily, and we had some nice cash-back rewards to use. 😈
Same here, if I have a big purchase, I'll make sure I get another good card, but it's so much admin working going through all the cards, paying them off, making sure balance matches my records....
Same here, if I have a big purchase, I'll make sure I get another good card, but it's so much admin working going through all the cards, paying them off, making sure balance matches my records.
Churning was fun in college when manufactured spending was as easy as walking into a pharmacy and getting some VGCs.
I find the economics of points/airline miles extremely interesting. There may be no such thing as a free lunch, but there's very often a lunch that's subsidised by someone else. You have luxury...
I find the economics of points/airline miles extremely interesting. There may be no such thing as a free lunch, but there's very often a lunch that's subsidised by someone else.
You have luxury services like business class flights or high-end hotel rooms that retail for thousands of dollars, but have very little marginal cost. It's all up-front capital, so the day-to-day pricing becomes this weird multivariate equation of potential profit maximisation based on supply and demand; an airline seat has a notional value in potential profit, but the plane is flying whether it's full or empty.
So you take the points, rather than the cashback. You've effectively traded $150 cash for around 10,000 points, nominally valued at $100. But then the airlines have a seat worth a notional $900, which is closing towards zero value if they don't manage to fill it, that you can buy with those 10,000 points. So what are they really worth? The $100 Amazon voucher you could trade them for? The $150 you forewent in cashback? The $900 sticker price of the airline ticket? The $0 that the airline would have otherwise got for that seat? Or the $400 you would have actually spent on a different airline ticket?
It's a great microcosm of how abstract and disconnected the costprice of an item, its perceived value, and it's actual cost can be. The simplified idea of value as a function of cost and a set profit margin is so misleading as to be flat out wrong in a lot of cases.
As for the actual question, I don't really churn, but I do keep an active eye on my cards. I have a card that I funnel the vast majority of my day to day expenses through (plus any group activities that people want to pay me back for - dinners, gigs, holidays, etc.) and then make an effort to really maximise the value I get from those points. On a good year, I've managed £10,000+ of business class flights on the points from only a couple of years' spending.
If you look at it on sticker price alone that's a ludicrous, impossible, unsustainable return rate probably north of 40%. But those seats represented maybe £1500 of value to me, and an otherwise empty seat to the airline, so I get a 6% return in real terms and the airline gets whatever kickback Amex gives them. It's as close to an all-round win as you can get.
Well, yes, there are few things with as plastic pricing as the travel and leisure industry. That being said, I believe that not getting credit card rewards is effectively leaving money on the...
Well, yes, there are few things with as plastic pricing as the travel and leisure industry.
That being said, I believe that not getting credit card rewards is effectively leaving money on the table. Not a lot of money, of course, but it does add up over time.
Here in the US, it's essentially illegal to sell things for a different price with a credit card than they would be sold for cash1. The difference is that when you use your credit card, the merchant does not get the full amount because the credit card companies take fees from the transaction.
So if the effective value of the object is realistically 1-5% less than what I'm actually paying, it makes sense to have some way to recoup that value. The only problem with this system is if you have moral objectives with the credit card companies.
Note 1: Sure, it's not an actual law and there are plenty of exceptions, but the vast majority of transactions follow this rule.
I'm glad it's worked for you ... I tend not to go for these because my experience with credit cards is, the costs sort of sneak up on me, despite my best intentions. I've been stuck with pretty...
I'm glad it's worked for you ... I tend not to go for these because my experience with credit cards is, the costs sort of sneak up on me, despite my best intentions. I've been stuck with pretty much the same CC debt since graduate school myself, punting it between different 0%-interest deals, and I hope to be able to pay it off very soon. But after that I'm thinking of actually cancelling or not using credit cards any more.
I've got to admit I'm a little jealous of your restraint. Good job taking advantage of a system meant to take advantage of you!
Yup. I did this right before my last vacation and used it to get $600 worth of Ultimate Rewards. And those points are worth 25% more if I redeem them for travel or hotels through Chase's website....
Yup. I did this right before my last vacation and used it to get $600 worth of Ultimate Rewards. And those points are worth 25% more if I redeem them for travel or hotels through Chase's website. And now they have this new feature called Pay Yourself Back which let's you redeem your points at 125% value on purchases you make in certain categories.
I definitely didn't get into the churning and sign up bonuses, but for a while I did a bunch of research on setting up a bunch of credit cards so I could get 4/5% cashback on most of my major...
I definitely didn't get into the churning and sign up bonuses, but for a while I did a bunch of research on setting up a bunch of credit cards so I could get 4/5% cashback on most of my major categories. Over time things like rotating categories became too much of a pain, and the Uber card went from an amazing restaurant/travel card to a useless piece of plastic. Now I have a 2% cashback that I use for most everything and a the amazon prime card for amazon/whole foods. Maybe I'll keep an eye out for a new travel/gas/restaurant card in the future based on my spending, but its really nice to just put everything on the 2% card and call it good enough.
Basically I find that my capacity to care doesn't outweight the meager benefits. Less thinking is better (for me).
By the way, the Costco credit card is the best for gas, even if you do not use Costco gas (but you should). You can cash it out every year for actual cash if you don’t shop at Costco much.
By the way, the Costco credit card is the best for gas, even if you do not use Costco gas (but you should). You can cash it out every year for actual cash if you don’t shop at Costco much.
You would make about $104 each year with that amount of spending from the gas rewards. The membership is only $60, so you basically get a free membership. Also, if you can take advantage of Costco...
You would make about $104 each year with that amount of spending from the gas rewards. The membership is only $60, so you basically get a free membership. Also, if you can take advantage of Costco gas, they are around 20-30 cents cheaper per gallon. That makes the savings even better.
I'm not sure that math is right...getting $100 back from gas at 4% would mean I spent $2500/year on gas. I'm spending ~$40/month on gas, so ~$500 per year, which is $20 cashback with the 4% on...
I'm not sure that math is right...getting $100 back from gas at 4% would mean I spent $2500/year on gas. I'm spending ~$40/month on gas, so ~$500 per year, which is $20 cashback with the 4% on gas. The other thing is the opportunity cost compared to the 2% card that I currently use, so thats really only a gain of $10/year - which isn't near enough to pay for the membership. The 3% on travel would help, but its really just 1% more than the 2% card, and I think I usually spend <$500/yr on flights, so that still only adding $5.
If I was already doing a costco membership or was close enough to take advantage of their gas station, then it might be an option. But I'm buying food for 1 and the nearest costco is probably 20-30 mins away. So unless the card pays for itself, then it isn't worth it for me.
Like this? I have several credit cards entirely for the purpose of getting interest free loans on specific large purchases: items of furniture, a set of tires, etc. These are usually high rate,...
Like this? I have several credit cards entirely for the purpose of getting interest free loans on specific large purchases: items of furniture, a set of tires, etc. These are usually high rate, bad deals otherwise, with big penalties if you are late on a payment. I auto pay them at minimum amount to maintain the interest free deal, and cancel them after they are paid off.
I use to, but then I calculated how much money/value in dollars I was gaining from it, divided by the number of hours I was spending on CC portals and on the churning subreddit and general management and realized that if it was a part time job, I wouldn't do for that hourly rate. So I stopped.
I still funnel all purchases through CCs, but I just keep a few nice ones with good cashback rewards.
Same. I know people who really enjoy the CC equivalent of extreme couponing, but to me it's not worth it. I have an Amex card that I've held for almost 10 years that I pay down to zero about once a week. I treat it like a debt card. And they give me 1-6% cash back on stuff. I have some insane $30,000+ limit on the card because they keep automatically increasing it hoping I'll use it. Not a chance in hell. I don't think I've ever had a balance higher than $4000, and that was after making a large single purchase which I then paid off immediately.
Hot damn! Is there a yearly fee?
It's like $95 a year or something. Before we got it the wife and I calculated that we would recoup that cost just from the cash back on gas in about 7 weeks.
The 30k limit is rediculous. When we first got the card the limit was something like $5k. I have never asked for a limit increase, but they keep periodically increasing it the longer I'm a customer and a few times after I've made very large ($1000+) purchases.
To be very clear: I will never, under any circumstances charge that much to that card. The interest would be insane, and anything that expensive should be saved for or be financed via a bank loan. And if the bank won't finance it, that should be a very large neon sign that I shouldn't buy that thing.
insert disclaimer here about emergencies like medical expenses because fuckit you're going bankrupt anyway, and also how fucked up US medical financing is
It's not precisely a points or signing-bonus scheme, but we've been using a Chase Sapphire rewards card for large planned purchases that we've already saved cash for, like moving expenses or major appliances.
Pay the bill with the card, pay the card with saved cash, and effectively get a greater return than we would have keeping the cash in a standard savings account.
It was a huge deal when the company I used to work for stopped allowing people to collect personal travel points from corporate expense credit cards. I just started paying for my business travel with the Chase card and holding Corporate's feet to the fire on legally mandated reimbursement turnarounds. In a busy year, I could get to that $30,000 you mentioned quite easily, and we had some nice cash-back rewards to use. 😈
Same here, if I have a big purchase, I'll make sure I get another good card, but it's so much admin working going through all the cards, paying them off, making sure balance matches my records.
Churning was fun in college when manufactured spending was as easy as walking into a pharmacy and getting some VGCs.
I find the economics of points/airline miles extremely interesting. There may be no such thing as a free lunch, but there's very often a lunch that's subsidised by someone else.
You have luxury services like business class flights or high-end hotel rooms that retail for thousands of dollars, but have very little marginal cost. It's all up-front capital, so the day-to-day pricing becomes this weird multivariate equation of potential profit maximisation based on supply and demand; an airline seat has a notional value in potential profit, but the plane is flying whether it's full or empty.
So you take the points, rather than the cashback. You've effectively traded $150 cash for around 10,000 points, nominally valued at $100. But then the airlines have a seat worth a notional $900, which is closing towards zero value if they don't manage to fill it, that you can buy with those 10,000 points. So what are they really worth? The $100 Amazon voucher you could trade them for? The $150 you forewent in cashback? The $900 sticker price of the airline ticket? The $0 that the airline would have otherwise got for that seat? Or the $400 you would have actually spent on a different airline ticket?
It's a great microcosm of how abstract and disconnected the
costprice of an item, its perceived value, and it's actual cost can be. The simplified idea of value as a function of cost and a set profit margin is so misleading as to be flat out wrong in a lot of cases.As for the actual question, I don't really churn, but I do keep an active eye on my cards. I have a card that I funnel the vast majority of my day to day expenses through (plus any group activities that people want to pay me back for - dinners, gigs, holidays, etc.) and then make an effort to really maximise the value I get from those points. On a good year, I've managed £10,000+ of business class flights on the points from only a couple of years' spending.
If you look at it on sticker price alone that's a ludicrous, impossible, unsustainable return rate probably north of 40%. But those seats represented maybe £1500 of value to me, and an otherwise empty seat to the airline, so I get a 6% return in real terms and the airline gets whatever kickback Amex gives them. It's as close to an all-round win as you can get.
Well, yes, there are few things with as plastic pricing as the travel and leisure industry.
That being said, I believe that not getting credit card rewards is effectively leaving money on the table. Not a lot of money, of course, but it does add up over time.
Here in the US, it's essentially illegal to sell things for a different price with a credit card than they would be sold for cash1. The difference is that when you use your credit card, the merchant does not get the full amount because the credit card companies take fees from the transaction.
So if the effective value of the object is realistically 1-5% less than what I'm actually paying, it makes sense to have some way to recoup that value. The only problem with this system is if you have moral objectives with the credit card companies.
Note 1: Sure, it's not an actual law and there are plenty of exceptions, but the vast majority of transactions follow this rule.
My city in Michigan would like a word. It is made very clear on the sign, one price for cash, another for credit. Usually around $0.10 a gallon.
Like I mentioned in the note, there are tons of real-life exceptions; gas is one of the most major ones.
I'm glad it's worked for you ... I tend not to go for these because my experience with credit cards is, the costs sort of sneak up on me, despite my best intentions. I've been stuck with pretty much the same CC debt since graduate school myself, punting it between different 0%-interest deals, and I hope to be able to pay it off very soon. But after that I'm thinking of actually cancelling or not using credit cards any more.
I've got to admit I'm a little jealous of your restraint. Good job taking advantage of a system meant to take advantage of you!
Yup. I did this right before my last vacation and used it to get $600 worth of Ultimate Rewards. And those points are worth 25% more if I redeem them for travel or hotels through Chase's website. And now they have this new feature called Pay Yourself Back which let's you redeem your points at 125% value on purchases you make in certain categories.
I definitely didn't get into the churning and sign up bonuses, but for a while I did a bunch of research on setting up a bunch of credit cards so I could get 4/5% cashback on most of my major categories. Over time things like rotating categories became too much of a pain, and the Uber card went from an amazing restaurant/travel card to a useless piece of plastic. Now I have a 2% cashback that I use for most everything and a the amazon prime card for amazon/whole foods. Maybe I'll keep an eye out for a new travel/gas/restaurant card in the future based on my spending, but its really nice to just put everything on the 2% card and call it good enough.
Basically I find that my capacity to care doesn't outweight the meager benefits. Less thinking is better (for me).
By the way, the Costco credit card is the best for gas, even if you do not use Costco gas (but you should). You can cash it out every year for actual cash if you don’t shop at Costco much.
Thats more or less what I've heard - but even in non-COVID times I spend $25-50 on gas per month, so not really worth getting a card for it.
You would make about $104 each year with that amount of spending from the gas rewards. The membership is only $60, so you basically get a free membership. Also, if you can take advantage of Costco gas, they are around 20-30 cents cheaper per gallon. That makes the savings even better.
I'm not sure that math is right...getting $100 back from gas at 4% would mean I spent $2500/year on gas. I'm spending ~$40/month on gas, so ~$500 per year, which is $20 cashback with the 4% on gas. The other thing is the opportunity cost compared to the 2% card that I currently use, so thats really only a gain of $10/year - which isn't near enough to pay for the membership. The 3% on travel would help, but its really just 1% more than the 2% card, and I think I usually spend <$500/yr on flights, so that still only adding $5.
If I was already doing a costco membership or was close enough to take advantage of their gas station, then it might be an option. But I'm buying food for 1 and the nearest costco is probably 20-30 mins away. So unless the card pays for itself, then it isn't worth it for me.
Ooh yeah. I calculated from $50/week, not per month. Sounds like you have this calculated out well enough.
Like this? I have several credit cards entirely for the purpose of getting interest free loans on specific large purchases: items of furniture, a set of tires, etc. These are usually high rate, bad deals otherwise, with big penalties if you are late on a payment. I auto pay them at minimum amount to maintain the interest free deal, and cancel them after they are paid off.