Category: Wisdom

EDITOR’S NOTE: I’m on an annual blogging vacation for the last two weeks of the year. To make sure you still have content, some of the smartest members of the community have stepped up with guest posts in my absence. Special thanks to today’s author, my original churning buddy and longest friend in hobby, Tyler, for writing this post while I’m on vacation. I’ll see you on January 1!

I’m not interesting. At least I don’t think. It wasn’t until Matt (MEAB) encouraged me to do a guest post that I realized I may be slightly more interesting than a layover in Lubbock. I asked “why me?” and he responded “you have a unique and interesting view on the world”. Coming from him, that is an amazing compliment. Although, Matt encourages us to read between the lines so perhaps that’s not a compliment. So I’ll share what I’ve learned this year. Just consider today’s blog post like going to a restaurant to get a Coke, yet they bring you an RC Cola. Just hang your head in shame and take it.

I took algebra twice, so I’m pretty good at math and I’ve calculated I pulled in over six figures from various MS activities this year (eight figures if I count the two numbers after the decimal point). It’s happened with effort, luck, stupidity, diligence, and tips from others.

I scaled hard this year. Matt told us “if you’re not getting shut down, you’re not pushing hard enough”. I learned this the fun way in a shutdown by a local credit union. I first was a bit frustrated, and even scared as I was grilled by the fraud team while they froze thousands of dollars. The financial proctology exam included every question except my blood type and my favorite karaoke song (that award goes to Gangsta’s Paradise – RIP Coolio). The CU shutdown turned out to be great, as it forced me to look at every CU in my state where I opened as many accounts as I could. I discovered one that allowed cc funding for new accounts/CDs. There are 5,000 credit unions in the US. Frankly, if you haven’t found one that allows CC funding on your own, you aren’t looking hard enough. And it’s not just credit unions. There are even banks that pay you to wire money in.

I better defined my goals, primarily shifting from points/status/miles to max profit. I travel less now, and I previously found myself racking up points and status for airlines I didn’t use. This year I sold a lot of points/status/gift cards on various markets and while it may not have a high cpp value had I used them myself, the mental aspect of having profit vs points was well worth it.

Diversification has been a core part of my investing strategy. This has been a catalyst for turning my miles earn and burn practice into profit earn and burn.  I had a goal to find one profitable activity from each of the MEAB slack channels, I read all channels from cradle to grave where I have been able to find a profitable activity in more than half – the others are there I just haven’t had time to get to them yet. If I just did one from each channel, that is 30+ different opportunities. And each channel as we know has multiple opportunities, even dozens.  Diversification is critical to not just churning, but to your own financial well-being. You need a job, stocks, retirement accounts, multiple small businesses, real estate, etc. For me, churning has turned into a similar thing – although I need to find a balance of being a jack of all trades, master of none and specializing in one thing. Having stocks, retirement accounts, businesses, real estate, multiple players has opened a ton of doors for activities to legitimize my practices.

This year I’ve probed and challenged conventional wisdom at retailers and discovered a few nuisances in my territory that paid off well. I even showed MEAB once how to get free Dominos. He tried it but was not impressed – apparently he has ‘standards’ when it comes to food… What a snob. I discovered even in my Kroger footprint there are different limits based on the technology of the registers in the same store. I’ve found this out with other chains and retailers too. Coupon codes maybe don’t have limits, or discovering you can create plenty of other accounts to score a deal, or promos that apply to things beyond the T&C. The sky can be the limit with some of these – but I gotta put in the time to try them.

As I go into next year and think about ‘what’s next’, I’ve learned spending is easy, liquidation is hard. Liquidation is my main struggle from payment processors, overzealous clerks, account freezes, and more. I’m frequently looking for liquidation channels to help scale so I plan to really invest in this area. I’ve been lucky to be able to float a bunch, though this is an area I need to invest more in. I think I’m going to adopt “WWMD” (What Would Matt Do) into my practice, though that might result in a more upscale taste to my liking. I’ll be selective when I apply this new way of thinking.

– Tyler

Matt MEAB reacting to his free pizza.

EDITOR’S NOTE: I’m on an annual blogging vacation for the last two weeks of the year. To make sure you still have content, some of the smartest members of the community have stepped up with guest posts in my absence. Special thanks to today’s author, the always helpful and funny SideShowBob233, for writing this post while I’m on vacation. I’ll see you on January 1!

Chase has some of the best checking and savings accounts bonuses, often $500 or $900, and people often jump at the chance to churn these every 2 years.  It sounds great, but when mixed with MS this can be a recipe for a Chase shutdown. 

Chase got in trouble with the feds over their lack of anti-money laundering (AML) compliance a few years ago and as a result has enhanced their AML analysis to a ridiculous level to avoid getting slammed again.  As a result innocent churners and MSers who use Chase are at risk of shutdown by this team.  I know what you’re saying “But SideShowBob233 (you’re saying the 233 part too) I won’t get shutdown I’m not stupid enough to do something to get on their radar” and you’re right – you’re not that stupid but it doesn’t mean you’re safe either.

Many things can get you on their radar that you have no control over:

  • Fraud on a debit card linked to the account
  • Another financial institution having a glitch and pulling a payment multiple times (looking at you Barclays)
  • A fraudulent ACH
  • SideShowBob233 going in your local branch and stepping on a rake while filling out a deposit form and accidentally putting your account number on the deposit slip
  • Some other thing happens that neither of us (and not even your mom!) warned you about

Once one of these things happens, your account will be flagged for review by the AML team, and once they see your activity on your credit cards (and potentially pull your EWS report – more on that later) they will decide you are not worth the risk and shut you down.  OK, so my cards are closed, not the end of the world – but it won’t be just your cards.  It will be the cards of anyone who was an AU on your account, possibly anyone who lives at your address, and also possibly anyone who was ever linked to you via an AU or employee.  And those people will be banned from Chase for at least 7 years, maybe longer although getting back into Chase is YMMV. 

So how do you avoid this?  Simple, don’t have a deposit account (personal checking, biz checking, savings, CD, etc.) at Chase.  Without funds on deposit their AML team doesn’t get to look over your profile.  Their credit card team can still shut you down for rewards abuse or other reasons, but those shutdown for those reasons tend to be whales (although you never know). 

Yes, you are missing out on the potential for multiple checking bonuses but is your Chase relationship worth it (the answer is NO!).  Don’t be like SideShowBob233 (you read the 233 part aloud again because that’s how you roll) and get shutdown because you think it won’t happen to you.  I was in the it won’t happen to me boat, I barely used it other than a direct deposit to keep it free, then I accidentally over-drafted it on a Saturday night paying my credit card after a rake party. 

And finally, if you are going to do it anyway, please tag me when you do get shutdown so I can say I told you so.  But seriously if you do want to get the checking because you are cool enough to avoid the AML team, at least slow your Chase MS when the account is open. 

Stay tuned for my next rant sometime soon on the bane of churning existence (your EWS report). 

Even Canada is listening to SideShowBob233, going as far as naming bills after him.

NOTE: I’ll be going on a blogging vacation between Monday and December 31, during which there will be at least some guest posts. I’ve already gotten a few queued up from readers smarter than me, and I’m soliciting for more to complete the holiday. Posts should be non-sponsored, non-promotional, non-political, and at least travel hacking or churning adjacent. Please reach out to me if you’re interested, it’ll be the third easiest gig you’ve ever gotten!

Introduction

Between 2011 and 2013, it was possible to earn miles for any Amazon purchase through the US Airways and Hawaiian shopping portals. In 2011 I was relatively new to the game and I made a common mistake: I had earned a chunk of US Airways miles through promotions and a credit card bonus, so I decided that I’d earn Hawaiian miles instead whenever I shopped at Amazon, even though had exactly no clear use case. I was sure that at some point I’d use them, just like Southwest CEO Bob Jordan is (incorrectly) sure that Southwest will never have a holiday meltdown again.

Piles of Miles

Now, please join me in 2023 and let’s peek at my current Hawaiian Airlines balance, keeping in mind that I’ve redeemed exactly as many Hawaiian miles as the number of good menu items at Chik-Fil-A, or the number of times that Southwest CEO Bob Jordan has correctly predicted the meltdown future [drumroll]:

Zero (0)

By 2013 I’d earned 40,000 Hawaiian miles through the Amazon shopping portal, but eventually they expired – partially because I was inexperienced and partially because I didn’t ever have a redemption plan in mind. This is a common mistake, especially when you’re stating out. In the last couple of weeks for example, I’ve heard from churners who:

  • Have mid-six figures of IHG points and have never stayed in an IHG hotel
  • Signed up for two Southwest credit cards without even having a Rapid Rewards number
  • Lost 500,000 ThankYou Points after a Citi shutdown, never having used a single point

Obviously some of these are more catastrophic than others, but they all illustrate a common theme: A point isn’t worth anything if it’s never redeemed, and if you have no loose plan, there’s a good chance you’ll never redeem.

MEAB, Get to the Point!

Before you earn any loyalty currency, have at least a rough idea of how you’ll use that currency. Otherwise, you’re almost certainly better off earning cash because at least that doesn’t expire and can be used effectively anywhere, for any travel, as long as your airline isn’t melting down.

Happy Holidays friends!

The easiest gig you’ve ever gotten.

Historically American Express takes just a couple of days to post sign-up bonuses on Membership Rewards earning cards, statement credits, card-linked offer awards, retention bonuses, and employee spending bonuses after the terms are met. Perhaps due to cold weather, or maybe due to the launch of a new Membership Rewards program in India without enough infrastructure to handle it, those credits and bonuses that used to post in a few business days are taking longer and longer to post. Typical posting timeframes:

  • August: 1 – 3 business days
  • September: 2 – 4 business days
  • October: 3 – 5 business days
  • November: 5 – 7 business days
  • December: 7 – 12 business days

Beyond the obvious delayed dopamine hit, why should we care? Easy. For some statement credits tied to the calendar, your credit often counts in the month that it posts even if the charge was in the prior month (though even that’s not completely consistent).

So, I’d consider this week your last week to use your airline credits, wireless credits, garbage credits (Dell, Adobe, Clear, etc), food credits, and other coupons to guarantee that they post before the month’s and the year’s end. Don’t be #bonvoyed!

Good luck, and happy Tuesday!

Pictured: American Express’s messaging system between the charge department and credit department.

NOTE: I’ll be going on a blogging vacation between December 18 and 31, during which there may or may not be any posts. But, we’ll ring in the new year on January 1, 2024 with the 2023 version of Travel Hacking as Told by GIFs though, so no need to be up in arms. What’s this “may”, you ask? I’m soliciting for guest posts and I’ll use those during the regularly scheduled newsletter. They should be non-sponsored, non-promotional, non-political, and at least travel hacking or churning adjacent. Please reach out to me if you’re interested, it’ll be the third easiest gig you’ve ever gotten!

In person manufactured spend has multiple potential points of failure, but the most silently insidious is buying a Visa, Mastercard, or third party gift card and discovering that it’s been tampered with after you’ve bought it. Time isn’t on your said when that happens because it gives the scammer more opportunity to drain the card before you’re able to act.

Most tampering scams require the scammers to check cards at least daily to see if they’ve been activated, so you’ve got an expectation value of a few hours time between when you buy the card and the moment that a scammer discovers it’s been activated. That means a stack of gift cards on your desk waiting to be liquidated has an increasing likelihood of issues, and a decreased expected net value over time.

The obvious takeaway? Open and inspect cards you buy immediately and liquidate as soon as possible (whether or not you’ve been scammed, but obviously especially if you’ve been scammed.)

Stay safe out there!

The rule also applies to this, err desert, the longer you wait between eating and the food exiting your system, the higher the risk to your digestive health.

Card issuers like American Express and Chase famously have cards with:

  • Statement credits that reset every calendar year
  • An annual fee that posts on the 12th statement
  • The ability to cancel a card and refund the fee for 30 days after it posts

Taken as a whole, these three bullets mean that late November and December are the ideal times to get a credit card with annual credits. For example, the American Express Business Platinum card has:

  • $200 airline incidental credit every calendar year
  • $200 Dell credit every six months
  • $189 Clear credit every calendar year

If you get the card on December 1, 2023, then your 12th statement won’t generate until (at the earliest), December 15, 2024, and thus you can get an annual fee refund through January 14, 2025. That means as long as you hit spend early and cancel the card before January 14th, 2025 you’ll get:

  • $600 in airline incidental credits (2023, 2024, and 2025)
  • $800 in Dell credits (2H2023, 1H2024, 2H2024, 1H2025)
  • $450 in Adobe credits (2023, 2024, and 2025)
  • $567 in Clear credits (2023, 2024, and 2025)
    (though you should discount those Adobe and Clear credits significantly)

There are a few gotchas to watch for, such as how Bank of America’s annual fee refund after an annual fee posts isn’t guaranteed, or how the Chase Sapphire Reserve’s travel credit is tied to cardmember year, not calendar year. But, you’re enterprising people, right?

Good luck!

The triple dip visualized as jello. From top to bottom, red (2023), white (2024), and confused (2025).

The deluge of promotions between Black Friday and Cyber Monday is waning like the Joyland Amusement Park in Lubbock, TX, but that doesn’t mean that your favorite promotions will die when they’re supposed to. Famously in November 2021 for example, VanillaGift.com had fee free Visa gift cards using code SHOPEARLY2021. That code was scheduled to last for a couple of weeks (which should also be obvious from the name), but it didn’t actually stop working until Summer of 2022.

This isn’t an isolated occurrence either, it’s happened to multiple promotions over the weekend and some of them will no-doubt continue throughout the end of the year, or if you’re lucky into next. What’s the lesson? Companies don’t always bother with expiration dates. Always be probing.

Clearly Lubbock’s amusement park outlived its expiration date.

News

Before we dive back into the time value of points, there are a few relevant and leading news items to discuss:

Not only does maximizing the value of your points require burning early and often, but it also necessitates hitting smaller products with outsized value harder than products with average value.

Revisiting the Time Value of Points

With those notes in mind, we can derive an equation for the time value of points. If it doesn’t render correctly in your email client, see the website here. (And yes, I’m sorry to put you all through this, but sometimes I can’t won’t help myself):

FV = PV \times (1 + r - (q \times d) + i)^n \times (1 - p)

Where:

FV = future value
PV = present value
r = any promotional increase of value in a given period
q = the probability of a devaluation in a given period
d = the rate of devaluation in a program in a period
i = interest on points earned in a period (there is a program that does this)
n = the period (time)
p = the probability a program shutting down and wiping out all value

(Thanks to Jon for noting that the original version of this post lacked a definition for i)

The Point?

Is this formula useful? Sort of. It’d be more useful if someone would write a quick calculator web site. Do I actually expect anyone to use this formula? No, not really for anything other than mental gymnastics.

Points and miles still devalue, and sometimes they devalue a lot. Don’t forget that the second part of this site is titled “And Burn”.

Pictured, left to right: MEAB with glasses; The entire churning community after this post.