One of my favorite ways to think about relationships with banks and FinTechs is “how much would you have to pay me to never use [institution] again?” (The severed relationship question)
My answer varies greatly depending on the institution, ranging from probably $500 (let’s say RobinHood), to $1 Million.
When a shutdown from a bank or a FinTech happens, I like to reframe the shutdown in terms of the severed relationship question and look back on my earnings. For example, if RobinHood gives me the almighty 🪓 and I earned over $500 from games with their app, then I got at least the value of the severed relationship question, so I can frame the shutdown as a success rather than as a blow.
As a bonus, I may find my way back into an institution that shut me down, which lets the game start over; sometimes when you’re shutdown, it’s just another opportunity to answer the severed relationship question for a second (or third) time.
How many miles should you hold in a loyalty account before you start liquidating them or choosing to earn something else instead? My hand-wavey answer is: Hold as many as you’ll redeem between now and the next devaluation. Of course, we don’t really know when the next devaluation will happen, but we can look into the last 10 years to try and find patterns on a program specific level.
Why Programs Devalue
Before we do that, let’s remind ourselves why devaluations happen:
Inflation happens, and mileage earning is tied to prices
Airline CASM increases over time
Hotel CPOR increases over time
Devaluing a currency helps a balance sheet
Devaluations suck, but they’re entirely predictable over time. If we take as a given that programs will devalue, the next logical question is “how often?”
The Frequency
I collected data for frequent flyer program devaluations from the year 2015 until now for the major five US airlines. For this dataset, I only considered redemption devaluations; I excluded elite program changes, the removal of free-stop overs, and similar perks that aren’t directly tied to the mileage redemption rate. Some of these devaluations were only for specific types of redemptions (for example, partner awards to Europe), but that didn’t matter for this study. If redemptions devalued in some way, they were included here.
Now, let’s go airline by airline, sorted by frequency of devaluation:
Ok, now what’s the expectation value for a devaluation in each program, just taking the number of devaluations divided by the time period (10 years)?
Airline
Devaluation Time (Expectation Value)
Standard Deviation
Delta
1.00 years
0.42 years
United
1.67 years
1.05 years
Southwest
2.00 years
0.88 years
Alaska
2.00 years
1.11 years
AA
3.33 years
1.82 years (sqrt(3/10))
What do I do with that?
Alright, how do you make this data actionable? Well let’s go back to my hand-wavey metric for when you should stop holding miles in a particular program: Hold as many as you’ll redeem between now and the next devaluation.
That means that I wouldn’t hold more Delta SkyMiles than I’m likely to redeem in the next 1.00 years, or at least the next 1.00 years after October 2023 (😬 Spoiler alert: It seems likely that we’re going to see another Delta devaluation soon.) It’s also yet another argument about why you should be holding flexible currencies that transfer multiple places and can be cashed out directly.
Long holiday weekends provide plenty of opportunity for churners and manufactured spenders, like:
Discount gift cards
Portal bonuses
Sales on airfare and stays
Discount goods for resale
They also provide another great unlikely benefit: In-store crowds.
Say what now? Crowds are a benefit? Yup. In crowds, cashiers and customer service desk personnel just want to keep lines moving. That gives you two ways to play holidays for in-person games:
Just keep running back to back transactions at self check out. As long as you’re quiet and not actively causing problems, you’ll be ignored. Holidays can be huge volume days
Try new things, if something hits wrong, customer service is too busy to make up rules and cause problems, they’ll usually just clear the error and move on
Good luck, and have a nice holiday friends!
Labor Day self checkout secondary effects, Kroger style.
In manufactured spend, churning, or practically any other walk of life, there’s always someone going bigger or having more success than you.* You can take that information in multiple ways, but the most common reactions I see are some form of:
I need to try harder, my volume is tiny
I doubt it’s even possible to do that much volume
After those initial reactions though, consider:
If you’re earning enough to sustain your travel, spending, DoorDash credits, or streaming habits (I guess), then you’re golden
If you earn more points then you spend, the points left behind are worth exactly $0, so earning more doesn’t make even sense without learning liquidation via the churning black arts
Churning and manufactured spend is a hobby, but it’s also a form of work – your work-life balance needs aren’t the same as anyone else’s
So run your own race, and have a nice weekend friends!
* Yes yes, mathematically that’s a stupid statement, but as a physicist who believes in the power of the spherical cow, it’s close enough.
EDITOR’S NOTE: Yep! We finally got another alliteration wisdom post.
Some credit card issuers really don’t like charge amounts that look like an integer multiple of a gift card purchase, like $1,000, $1,013.90, or $2,027.80, especially if they see lots of them. If your account has too many of those, they’ll either claw-back rewards, shut you down, file a SAR, or in the worst cases, call the local police department.
The typical work-around to avoid exact charges is to also buy a banana, tabasco, or a serrano pepper with each purchase. Those are great options until you forget them in your trunk, then come back days later to a candidate for /r/MoldlyInteresting hiding in your car.
There’s another way to avoid the exact multiples though: Bring some coins and dollar bills with you and stick those in the self checkout register before you swipe your cards.
Good luck, and happy spending!
Yes yes, some banana mold patterns are pretty cool, I get it.
Generally, the quickest way to move cleared funds between deposit accounts in the US is via wire transfers. Churners often like wires because:
Limits are huge
Funds are guaranteed (they can’t bounce)
Fees are often minimal
Wires have a dark side though: For the exact same reasons that they’re useful for a churner, they’re risky for a sending bank. Because of that risk banks often have fraud analysts look at your wire and your account activity before releasing funds, and if you play lots of manufactured spend related games, I’m guessing a fraud analyst won’t like what they see.
I get a report at least monthly from someone who had a bank or credit union shutdown after sending a wire, so keep your activity, bank history, and profile in mind before sending one from an account you care about.
Happy Tuesday!
An analyst looks into an infamous churner’s deposit account.
What does credit card unicorn hunting look like in 2025? Well, unicorns come in many forms and are often very tied to different manufactured spend techniques. But once you’ve moved past sign-up bonus hunting, you should be looking for some combination of:
Credit cards that take lots of different types of payments
Good base earning multiples
Category specific earning multiples unique to your situation
Bill payment methods that earn rewards
An issuer that doesn’t mind cycling
You’re not going to find the full deck with American Express, Chase, or other giant banks, but you’ve got a great shot of finding your own unicorn by scouting credit unions and regional banks. Always be probing.
EDITOR’S NOTE: Today’s post is a Friday guest post in a short summer series running on Fridays while I’m traveling. Today’s author is irieriley, a manufactured spend gigachad who’s been featured on the blog multiple times in the past.
One of the most exciting parts of this hobby is the emergence of a new play. When you find something, especially if it’s particularly lucrative, it’s tempting to start scribbling some ballpark math on the back of a cocktail napkin.
After all, you need to start planning what color of Lambo you’re going to buy when you hit this play every day to the deposit limit for the next year straight. There’s no way this play won’t last forever, right?
Unfortunately, nothing actually lasts forever in manufactured spend (MS) and plays die without warning. For example, a growth stage fintech that lets you make “kalls” on election results will quickly wonder why they are paying so much interchange (and how “debit cards only” didn’t actually apply) to users that aren’t profitable.
Even archaic financial institutions founded in the 1800s will eventually have a Western region VP of accounting realize they’re absolutely hemorrhaging money.
Knowing that lucrative plays have a finite lifespan from the second they’re discovered, here’s my advice. Outside of very rare situations (i.e. causing a shutdown at Amex or your primary hub, and also, don’t break the law, for obvious reasons), you will regret not going hard on a target vs. pacing yourself, trying to keep it alive long-term.
You may not be hitting it hard, but whales, miracle doctors, and their small army of players are, and you’re collateral damage. Make your money, accept the shutdown because you aren’t a profitable customer, and move on (hopefully with an increased balance that matches your napkin optimism).
I speak from experience on counting my chickens too early. 2 years ago, I did some napkin math on profit based on maximizing employee card slots across Amex charge cards for myself and P2, since we had been targeted for them a ton in the months preceding. Guess who has virtually never been targeted to add ECs since that exercise?
I ended up making more money that year than my napkin math suggested, through entirely different plays. And yes, those plays are all dead now, too. But as my P2 loves to say, “there always seems to be a new scheme around the corner when you’re sad about one dying”. Stay frosty, my friends.
– irieriley
Pictured: a whale opening the gullet to inhale 100k lbs of chicken, er, krill.
