Category: Wisdom

Let’s roll with a hypothetical and single out Capital One while we’re at it, because reasons.

Assume that you’re shopping for exactly $1,500.00 worth of hot Takis at the local Kroger affiliate. After ringing up your cart full of Takis, you swipe your Venture X card. The charge goes through, but then you get this message on your phone:

Hi, it’s Capital One. It looks like you may have purchased a gift card from FRYS-FOOD-DRG #0073 on your Venture X Business ending in 1111.

We want to remind you that Capital One and government agencies will never request payment in the form of gift cards.

If you think a scammer is trying to convince you to pay them with a gift card, don’t give them the gift card information. Instead, call us at the number on the back of your card.

Obviously, Capital One has already algorithmically determined that (1) your Takis look a lot like gift cards, (2) you’re either a manufactured spender or a rube, and (3) they don’t want to pay for your chargebacks once the jig is up whether or not you’re a rube.

If, on the other hand, you toss a few coins into the register or swipe a nearly empty gebit card and watch it auto drain before swiping that Venture X, you’ll never hear a peep from Capital One’s automated systems because rubes don’t buy $1,499.22 worth of gift cards (obviously).

So, carry some extra change, nearly drained gebits, or go to an actual cashier and ask them to split payments before buying hot Takis in the future; your account’s longevity probably depends on it.

Have a nice weekend!

Alternate method: buy a bag of hot Cheetos with the hot Taki’s, but be aware that this may cause the spontaneous and abrupt end of the universe.

A credit union account that you opened years ago can often be your best friend when new techniques are discovered. For example, one of my favorite credit union accounts has been useful as:

  • a money order dump
  • a bill payment target
  • a CD funded with credit card target
  • a debit load target
  • a basis for a credit card with the same credit union
  • other games

There are often dry spells between plays though, and if you’re not careful, an account primarily useful for gaming might be closed for inactivity during your dry spell, with any remaining funds being sent to your state’s unclaimed property division. To avoid that, I do the following:

Set up a recurring $1 (or whatever the minimum) monthly ACH to the account from a central checking account, or from another credit union target account.

If you’re worried about the monthly drain on your central account, there’s no reason you can’t set the transaction up in reverse a few days later.

Good luck, and happy Thursday!

Sadly, not all games keep credit union accounts active.

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.

Have a nice day friends!

There are benefits to severing too maybe?

Introduction

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:

Delta (10 devaluations): February 2015, August 2016, August 2017, June 2018, March 2019, October 2020, February 2021, April 2022, October 2022, September 2023

United (6 devaluations): October 2016, November 2017, November 2019, April 2020, May 2023, April-May 2024

Southwest (5 devaluations): April 2015, April 2018, April 2021, January 2024, March 2025

Alaska (5 devaluations): March 2016, July 2018, October 2019, March 2023, March 2024

AA (3 devaluations): March 2016, April 2023, July 2025

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)?

AirlineDevaluation Time (Expectation Value)Standard Deviation
Delta1.00 years0.42 years
United1.67 years1.05 years
Southwest2.00 years0.88 years
Alaska2.00 years1.11 years
AA3.33 years1.82 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.

Good luck out there, and have a nice weekend!

Coming soon to Delta, probably.

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.

Close enough, right?

    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.