Category: Wisdom

Introduction

The motivation for today’s post is ostensibly that the Bank of America Travel Rewards Visa has an increased $250 cash back or 25,000 points portal bonus when applying through Rakuten. That’s cool and all, but let’s talk about the darker side of maximizing credit card applications instead, because that’s funner.

Who Gets Paid?

When you apply for a credit card, there are generally up to three payouts from the bank after an approval:

  • Affiliate commission
  • Referral bonus
  • Sign-up bonus

It’s hard to get both a referral bonus and an affiliate commission on the same application, though gamers gonna game and it can be possible in certain cases. It’s also getting harder to get a referral bonus period (thanks Chase).

I think we have a good idea of how much sign-up bonuses and referral bonuses pay, but there’s a lack of transparency in affiliate link pay. It’s probably higher than you think though. Current payouts, for example, look like:

  • Low end: tens of dollars
  • Medium end: hundreds of dollars
  • High end: $1,000+

Yes, you read that right, there are high end cards that pay more than $1,000 in commission, and sometimes not even just a little more.

Maximizing Your Pay

Churners generally think of affiliate commission as something they’ll never earn, but it doesn’t have to be that way. The most obvious example is the one we led with: Rakuten effectively gives you a rebate on their commission. This is definitely the most public example, but seeking other affiliates may lead to much higher rebates on commission. Always be networking, and always be probing. Before anyone asks me, I refund 100% of the $0 affiliate I get for every credit card application, so 100% is the high bar to beat.

Good luck, and happy Wednesday!

A couple springs for a nice dinner with extra affiliate income.

A favorite past-time in the hobby seems to be to confuse the law with the terms and conditions of a card issuer, FinTech, website, bank, or other third party. So, let’s go over a couple of ironclad truths:

  • You can break the law and still be within the T&Cs
  • You can break the T&Cs and still be legal

To crib from Mike Ehrmantraut, I’ve known good churners who break the T&Cs, and I’ve known bad churners who comply with T&Cs. Something something about the law too.

Good luck out there!

I’ve also known churners that broke the banana bed terms and conditions.

Based on my personal observations from watching hordes of travelers stare at flight board delays and cancelations in abject horror yesterday, approximately 104.4% of travelers flying in the US had their flights either delayed or cancelled over the weekend. In no particular order, let’s talk about what a good travel hacker does when their flight is, err, impacted:

  • When your plane is delayed more than an hour, or when your captain tells you that they’re returning to the gate to “….” (it doesn’t matter what the “….” is, trust me), book a backup non-basic economy award flight on another carrier immediately. Why an award flight? So you can cancel it fee-free. If you don’t do it right away, inventory might be instantly gone when the cancellation is official. Why another carrier? You don’t want it cancelled as a double booking. Once you’ve done that, do it again on a third carrier if there’s an option.
  • Do three things simultaneously and immediately when a cancelation is official, and when one of them works you can cancel the other two:

    – Reach out to the airline on twitter X and ask to be rebooked
    – Call the customer service line and ask to be rebooked
    – Go to the airline lounge and ask to be rebooked

    Note that none of these are waiting in line at the gate or the customer service counter. Don’t do it, it’s not going to go well for a dozen reasons, not the least of which is the garlic burger from Carl’s Jr shoved in the person’s now-translucent-from-grease backpack in front of you.
  • If you have a forced overnight, don’t take the airline’s hotel voucher; in the best case it’s going to be at an airport Marriott Courtyard overlooking a dumpster and the room’s smoke detector will beep once every 42.5 minutes, but only when the lights are off. We’re not going to talk about the worst case.

    This is why you booked with a premium card for travel insurance, right? Let them pick up the hotel and your extra elite night credit too. Oh, and on that note, this will probably be a rare paid stay for you, so use up those FHR credits, Bilt stupid hotel credits, Citi hotel credits, etc. Don’t use points or a free night certificate though because you’ll have to fight with insurance about the value.
  • Meal vouchers often work on Starbucks, McDonald’s, and Chick-fil-A wallet loads, and if you want to cosplay a Paze churner, Dunkin too. You can do these from your FHR room too, no need to do it at the airport.
  • Sure, travel insurance will cover a replacement $3.94 tee-shirt from Walmart, but it’ll also cover a $39.40 shirt from American Eagle.

Good luck, and at least be thankful you didn’t have travel between TN and CO via TX and CA, that is, unless you wanted to because reasons. Have a nice Monday!

PS: Special thanks to everyone in Denver over the weekend (and the ones still stuck there today!)

Ok, maybe the beeping isn’t the most concerning part of that Courtyard smoke detector.

I’m certain you don’t need another article about how AI is changing everything, I mean, I think it’s obvious that it is and you already knew that. But, we’ve entered a new era of disinformation in churning, and as a shrewd churner, there’s a newly popular kind of redirection to watch out for.

Background: The Forum Problem

Search results in AI are wildly overfit on forums. When there’s only a single answer or two in those forums, your AI overview will quite confidently give you a summarized version of those posts. This can be, and is being, actively weaponized in churning.

Do you want to spread FUD to protect your own play? Good news, it’s simple as long as there’s not a lot of discussion out there. Just respond to a question on reddit or on FlyerTalk with FUD, and Google, Perplexity, and even Bing (remember Bing? How about Alta Vista?) will spread your FUD to everyone who asks. Need an example? There’s nuance to be clear, but sure.

Result: The “Gemini said ….” Problem

Obviously, this feeds into a lot of the current state of the world and the kinds of discussion happening in private. Let’s take a really basic example: “Gemini said I could use a Mastercard at Costco, so I got the new stupid Citi AA Executive Mastercard and I’ll hit the bonus spend at my local store”. Gemini might be sort of right (Mastercard debit cards with PIN will work at Costco stores), but I hope you have a fallback when you find that your Mastercard credit card won’t actually work.

Dealing with It

Cool story bro, but what do I do with that? Well, in churning and manufactured spend, those who dig just a bit deeper, think just a bit harder, and trust but verify often do orders of magnitude more volume than average. So, I guess do whatever you want with that.

Happy Wednesday friends!

Sometimes AI generation is very meta.

Sometimes there’s a deal that’s worth traveling across the country, like say when Meijer used to offer 15% off of Choice gift cards, something about Nobby Hills, or seeing UFOs in Lubbock, TX I guess?

Similar deals come and go, and often they slide by because analyzing whether it’s worth traveling takes a mental load that’s never lifted. To that end, Having that number ready to go might mean you make it. Sample:

Earn side:

  • Return on spend from your credit card: 4%
  • Return on spend from the deal: 5%

Cost side:

  • Round-trip ticket: $360 (30,000 miles at 1.2 cents each)
  • Rental car: $100
  • Hotel room: $300
  • Meals: $100

Let’s call that about $1,000 to keep it easy (just like physicists use π=3 to keep it easy), which means you’d have to spend around $11,100 to cover your costs, excluding opportunity cost at home of course. There are lots of places that will let you spend that amount in a single transaction, so it can be a quick return.

Of course there’s opportunity cost, you might hate traveling, you may have a family or job to consider, or maybe you don’t believe in UFOs. This isn’t a complete analysis, just a go number. So, what’s your go number?

Have a nice one friends!

#neverforget

It’s been a hot second since we’ve talked about The Velocity of Money here, so as a tl;dr: Taking a small cut when moving money between different ledgers can be rewarding, and doing it a bunch of times makes it a bunch more rewarding.

We can deconstruct that into features we should probably look for in FinTechs, some of which aren’t normally gathered by average due-diligence as far as I can tell:

  • Quick posting
  • Fast transfers
  • Frequent rewards posting and cash-out
  • Real-time payments / FedNow support
  • Cycling tolerance
  • Account scaling

Of course the regular things that we’re looking for like low fees and high limits matter too, but I think most of us have a good handle on those.

Good luck out there, and remember that it’s often better to have a small slice of a huge pie than a big slice of a small pie.

On the other hand, sometimes it’s best to have no slice of a gross pie (sorry for multiple reasons to the singular hot dog pie lover out there).

There’s a simple principle that we can either (1) get all economisty about it and brandish words like “specialization”, or (2) we can just state the somewhat obvious:

When a small group works together toward a common goal, they minimize individual weaknesses and amplify individual strengths.

This is absolutely true in churning and manufactured spend too. When you’re forming your close-knit circles, non-toxic personalities that are different than your own are probably going to lead to much better results.

Happy Wednesday friends!

Next up: How the “Apex Diners Club Churners” in the 1970s gave birth to rational ignorance.

Memorial Day, like Labor Day, Mother’s Day, Christmas, National Bubble Bath Day, and a few other favorites, typically presents a great opportunity for one-off manufactured spend and travel hacking deals. We’ll see opportunities like:

  • Gift cards for sale under spot resale prices
  • Travel packages priced at relative minima
  • Extra inventory for award redemptions
  • Old apple products for really cheap

Broadly speaking, if you play the game today, you’ve got two choices:

  • Stick with what you know and can earn on any other day
  • Follow slickdeals, deal blogs, chatrooms, reselling slacks, and everything else to find great quick hits like those mentioned above

Either works obviously, but when you’ve built a war chest of manufactured spend volume, you’re probably going to earn more by sticking with what you know then you’ll earn or save by staying in front of a computer looking for today’s deals all day. So, unless you’re in this for the chase and the thrill of the new deal, consider spending your time today either doing what you normally do or learning more about how to build your war chest.

Or, we can summarize this post simply as:

Try and get the expected value of what you know bigger than the expected value of today’s quick hits.

Happy Monday friends!

Not all $15 apples are a good deal, even today.