Plan before you Churn Credit Cards!

There is a lot of talk around the blogosphere about credit card churning, where you utilize sign up bonuses to get some pretty sweet perks. Once you collect the bonus, close the account, find a new credit card sign up bonus and repeat the process.

Well, I’m here to tell you…. Plan before you Churn.

When I started my new job, I also signed up for a new credit card. The offer for opening the card was pretty sweet, but for it to be sweet you have to spend $3500 in 3 months. I thought I could make it. I really did. Well, my 3 month period is nearly up and I’m not going to make it.

Please learn from my mistakes.

Here are a few things you need to think about before Churning.

1. Get your Significant Other onboard. 

My husband had been paying for nearly everything before I got my job. For at least the first month of my Churn, he challenged me every time I tried to pay for anything. He’d say things like “Are you sure?”, “You don’t have to do that.” or “No, let me get it.” I kept telling him it was fine, that we will balance it later. But he didn’t like it. He didn’t like me reaching into my wallet to pay for things. He didn’t want people to think that he couldn’t provide for me.

He also didn’t open up his spending. I could have been paying for his cell phone (which earns me double points) and his gas fill-ups this whole time.  I know some of these kinks are due to the fact that we hadn’t fully integrated our finances, but these last 3 months would have been a lot easier if he was onboard the whole time. His extras may not have fully put me over the edge, but it would have made the final stretch possible.

2. Know Their  Terms.

Credit card offer terms vary. Make sure you know all the details before you sign up. Specifically, how long do you have and how much do you have to spend? I was 100% convinced I had 5 months, not 3, to reach my goal. Five months would have been easy peasy. Three months is hard… especially when I thought I had 5.

3. Know Your Spending.

You need to have a good grasp on how much you spend every month and any major upcoming expenses. We paid our 6 month car insurance bill a week before I was offered my job. That could have helped a lot in reaching $3500. I had a rough idea of our monthly spending, but rough doesn’t cut it. During this time, we started following a budget to see where our money was going. We plugged any identified leaks. This does not bode well for meeting a spending limit.

4. Learn the Loopholes.

Before I started this failed attempt, I didn’t know much about credit card churning. I understood that you needed to spend a certain amount in a certain period of time but I didn’t know that there were so many creative ways to do that.  Until the last week or so, I didn’t think about buying gift cards to places where I already shop to spend later. Oftentimes you can do this at grocery stores, where I earn double points anyway. Others use Bluebird by American Express, a prepaid debit card. There is also Amazon Payments, where you can allegedly send anyone money using a credit card with no fee. If you want to churn, you should probably learn about these things.

5. Watch for other Promotions.

If I had waited a week to sign up for my credit card, I would have earned half of the promotional bonus without spending a dime. This was on top of the regular bonus. So instead of getting a sweet bonus and a half, I am getting nothing. Churn Fail.

6. Don’t Spend more than you Normally do. 

During my churn, I spent money on things I normally wouldn’t have. My husband and I went on a few extra (cheap) dates. I ordered a drink places I normally would have ordered just water. I love the dickens out of my Momma, but I bought her flowers for Mother’s Day that were delivered to her work. They ended up being more expensive than I planned because I wanted to earn frequent flyer miles on top of using my credit card.  If I would have just picked up a bouquet on my way to her home, I would have saved money and I could have seen her face when I gave them to her. Daughter failure. At least now she gets to be the envy of the office because her daughter is so wonderful. (<- This is what I keep telling myself to make it okay for what I did)

If I add up how much I’ve spent to try to get the perk, I may have spent more than the perk is worth. That feels icky so I refuse to tally up my frivolous spending.  Don’t feel icky. Don’t spend extra just to reach your spending limit.

Please learn from my mistakes if you are going to churn credit cards!

Have you tried to churn a credit card? Do you have any tips?

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4 comments

  1. I don’t have a credit card since before, but thanks to all the bloggers I really learned a lot from you guys, from card churning and travel hacking tips. I’m still thinking if I should get a credit card this year.

    1. Credit cards aren’t bad if you can manage them. But they can easily get out of control. None of the rewards are worth it if you go crazy with your spending! Figure out what’s best for you.

  2. I don’t churn cards, because that’s just tempting fate 😛 But I did do a balance transfer (0% interest for 12 months) so that’s saving me a bunch… kind of like a signup bonus.

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