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 who is infamous enough to not need an introduction but get one anyway, SideShowBob233. I’ll see you on January 1!  If you’re interested in writing a guest post, please reach out!

So it’s been about a year since my Chase post, which has been mostly well received.  I’m a year older, a year wiser (really you’re thinking, are you wiser SideShowBob233 – and yes you’re still saying the 233 part), have a lot more rakes behind me (but still too many in front of me) so do you still think Chase deposit accounts are a bad idea?  

The answer is yes.  After my post I continued to hear many people report shutdowns with deposit accounts, including quite a few shutdown within a couple of weeks of opening the account for a bonus.  Each one makes me want to put a rake in front of them and watch gleefully (which is how I do all my watching, sometimes with only my clown shoes on – get that image out of your head!) as they step on it.  Why people risk their Chase relationship over less than $1,000 is a mystery to me, as is how to walk past a rake without stepping on it.  

What really gets me mad (about this – I’m not talking about my anger over Bart and definitely not about my anger over people who spell “lose” as “loose”) are the people who argue with me that it’s fine and that I’m making a big deal over nothing.  Some people took issue with my characterization that you are more likely to get shut or that you will get shutdown, which is a fair argument if you take my posts as fully serious, which is something only a clown would do.  

When I say you will get shutdown I’m talking odds, but with odds there’s never a guarantee.  However, my trusty buddy Chad ran the numbers for me and there is a 420.6969000000000012% increased chance of being shutdown by Chase when you have a deposit account (I believe Chad had some assistance with his calculations from the Fluz interns).  Now that doesn’t mean you will be shutdown, but I don’t like those odds (OK maybe I like parts of the odds, but not all together).  And again $1,000 is nice (I could get a gold-plated rake!) but you can get that from a single Ink card bonus so why risk it?  Not to mention Chase deposit accounts report every penny to Early Warning System (EWS).  

“So SideShowBob233” you’re thinking (let’s face it you’re not thinking that you’re saying it out loud and your family is wondering whether your meds have worn off and you’re talking to your imaginary friends again), what if I haven’t heard of a single Chase shutdown ever caused by this?  To that I say you need to get out more, especially out of the rubber room they keep you in because it happens often, both to people who know better and to people who don’t know better but should (and even to random people who don’t churn at all, because Chase really doesn’t care if they screw you over for no reason).  Even if you don’t hear about them, I hear about them, and if you dig enough you will too (or they’ll restrain you for trying to dig in your rubber room, if that happens definitely don’t mention the clown with the orange hair and rakes, it won’t help your case).  

I’d like to end this by pointing out there are tons of banks and credit unions (and I weighed them all to confirm there are in fact tons, not just metric tons) all of which are not Chase, do not report to EWS, and also have bank bonuses.  So please stay away from Chase (and Citi) bank bonuses.  There are even some lovely fintechs that are not banks and for a fee (but often for free!) will lose your money for good.  

Now I’d really like to end this (and I can hear you muttering SideShowBob are you ever going to really end this, but you left off the 233 this time because the elf on the shelf told you to stop saying it because it makes you sound crazy) by suggesting you use a business bank account for anything you can, especially one that does not report to EWS (some do, like BOA business checking for some sole prop businesses). Stay tuned for more.

– SideShowBob233

SideShowBob233 (pictured) dictating this article to MEAB (pictured?)

MEABNOTE: I’ll be going on a blogging vacation at the end of the year and there won’t be any daily posts between December 18 and December 31. After that, we’ll ring in the new year on January 1, 2025 with the 2024 version of Travel Hacking as Told by GIFs though, so no need to be up in arms, but I guess it’s ok if you’re up in legs.

By popular demand we’ll have at least a few guest posts during the break. If you’d like to write one, please reach out, I’d like to find guest posts for the whole break!

Echo Chambers

The internet is full of echo chambers in which opposing viewpoints mostly don’t exist because of something like: selection bias, moderation, “the algorithm”, or another reason. Because I know you need some examples, there are a few you may already be familiar with:

A recent FlyerTalk post titled “Any Success Stories of Living Off [Manufactured Spend]?” is a perfect illustration of how we can get stuck in echo chambers without realizing it. The thread itself is rather short, and if you read it in its entirety you’d think that maybe a couple of people lived off of manufactured spend in the past but it’s probably not happening much anymore and might also have weird tax consequences. Everyone in the insulated forum is reinforcing what they already believe, and it makes sense because it’s aligns with their world views.

On the other hand though, I personally know at least a couple of dozen people that live off of manufactured spend, and I’m sure there are plenty more that I don’t know of. Also, I’m not a tax guy and I’m definitely not your tax guy, but it’s not hard to account for and to pay taxes on your manufactured spend based earnings. Based on my personal experience, the FlyerTalk thread is naive at best and gate keeping at worst, and it illustrates a lesson that can take you a long way in churning and manufactured spend:

Sometimes the prevailing discussion in your echo chamber is wrong, and you can use that to your advantage.

– MEAB

Or, to rephrase in Michael Scott form:

“Trust but verify – Ronald Reagan“

– MEAB

Happy holidays and I’ll see you next year!

(I think it was actually John Quincy Adams, but ok)

MEABNOTE: I’ll be going on a blogging vacation at the end of the year and there won’t be any daily posts between December 18 and December 31. After that, we’ll ring in the new year on January 1, 2025 with the 2024 version of Travel Hacking as Told by GIFs though, so no need to be up in arms, but I guess it’s ok if you’re up in legs.

What happens with your points when a major bank shuts down your accounts? If you’re in New York, you’ve got 90 days by law to redeem your points, though the options for redemption may change on shutdown. If you’re not in New York, here’s what the landscape looks like:

  • Chase: You’ve got 30 days to redeem or transfer your miles
  • Capital One: Your miles are immediately redeemed at 0.5 cents per mile
  • American Express: Your points are forfeited at the end of the business day
  • Citi: Your points are forfeited at the end of the business day
  • Wells Fargo: Your points are forfeited immediately

With American Express and Citi, if you’re quick at noticing the shutdown, you can call their redemption departments immediately and likely get your points redeemed or transferred out. The phone numbers for each:

  • American Express Membership Rewards: 800-297-3726
  • Citi ThankYou Points: 800-842-6596

If your points are forfeited, you may be able to mediate or litigate to get your points back, but of course I’m not a lawyer and I’m definitely not your lawyer.

Good luck and stay safe!

Captured: The moment a Membership Rewards bucket drains.

The last week of November saw groups of shutdowns from three major banks: Discover, Wells Fargo, and Chase. If you were affected, sorry – that sucks. But even if you weren’t, we can learn from what happened. Let’s go bank by bank:

Discover

Summary: Repeated negative balances pushed the risk team over the edge.

Explanation: One of the tricks of the trade in high volume manufactured spend is to prepay your credit lines, creating a negative balance on your account in order to be able to spend more than your credit line. Some banks don’t care when you do this, but Discover isn’t one of those banks.

Lesson: Be cautious about overpaying credit lines. Discover isn’t the only bank that doesn’t like it.

Wells Fargo

Summary: Non-standard payment methods spooked the risk team.

Explanation: Sometimes paying a credit account directly via ACH isn’t the best way to pay; as a /r/OldSchoolCool inspired example, CheckFreePay at Walmart Money Centers used to be a great way to pay your Visa and Mastercard bills using Visa and Mastercard gift cards. In the case of recent shutdowns, a payment method that a regular customer wouldn’t normally use was advantageous, at least until Wells Fargo decided it wasn’t.

Lesson: Consider the source of payments to your credit accounts, often banks don’t like abnormal payment methods, and side note: that’s especially true with anonymous payment methods.

Chase

Summary: Prior chargebacks related to fitness club associations finally caught up to bag holders.

Explanation: There was a private manufactured spend group a few years ago that imploded, leaving hundreds of people with outstanding money that wouldn’t be paid back (no, this isn’t Synapse). Some people initiated chargebacks on that money, occasionally well into five figures or more, and Chase finally decided that those chargebacks made account holders personae non gratae.

Lesson: If you ever need to use chargebacks to bail yourself out, make sure the value of the chargebacks exceeds the value of your relationship with the bank.

Good luck out there, and happy Wednesday friends!

Another potential shutdown affecting all churners: Failed identity verification.
(Thanks to Vince for the unfortunately real screenshot)

One of the best pieces of business advice I ever got was at my first startup: “It takes just as long to do a small deal as it does to do a big deal.” That’s often a slight exaggeration because in business, bigger deals usually mean more people are involved, but the sentiment is still roughly correct. Focusing on the big deals is a better use of time when you’ve got a good pipeline.

We can apply that wisdom to all of this weekend’s opportunities in gift card reselling, buyers groups, online arbitrage, point alchemy, and to an extent with travel bookings too. My companion advice to the above for this weekend, specifically, is:

Set a minimum deal size and minimum effective hourly wage for all of your shenanigans. If something flashes by and it’s below that threshold, wait for the next thing. It’ll come.

Have a nice weekend!

Pictured: My first startup, or something.

Bank of America, Wells Fargo, Chase, Citi, and plenty of your favorite credit unions offer premium (or sometimes even fee-free) cards that offer annual credits tied to the calendar year. Most issuers also let you refund an annual fee up to 30 days after it posts too. Combined, that means December is often the best time of the year to get a card because:

  1. Your first statement is usually issued 30 days after getting a card
  2. Your annual fee posts on the 12th statement around 360+30 days after opening
  3. Most issuers give you an annual fee refund if requested within 30 days of posting pushing that to 360+30+30 days
  4. 12 statements will straddle three calendar years: 2024, 2025, and 2026

Let’s take the American Express Business Platinum. Annually, you’ll earn (amongst other things, like I dunno, prolly a $1.50 monthly credit to Dollar Tree):

  • $200 airline incidental credit
  • $400 Dell credit ($200 in the first half and again in the second)
  • $199 Clear credit

So if you apply for a card in late November or December, your 12th statement won’t generate until between mid-December 2025 and mid-January 2026. Once that happens, you’ve still got another 30 days for games and an annual fee refund. You’ll get:

  • $600 in airline incidental credits (2024, 2025, and 2026)
  • $800 in Dell credits (2H2024, 1H2025, 2H2025, 1H2026)
  • $450 in Adobe credits (2024, 2025, and 2026)
  • $597 in Clear credits (2024, 2025, and 2026)
    (though you should discount those Adobe and Clear credits significantly)

There are a few gotchas to watch for: Bank of America’s annual fee refund after it posts isn’t guaranteed; Capital One’s is guaranteed, but the guarantee is that they definitely don’t offer fee refunds; or how the stupid Dell credits may be going away from the American Express Business Platinum in July, 2025.

Happy Tuesday!

Next time: The Halloween triple dip?

The Stunt

Sometimes travel hackers get stuck with a ticket that’s got a cancellation fee (I’m looking at you and your stupid $75 award ticket redeposit fee FlyingBlue) or a ticket that simply isn’t cancellable for any fee even if you’re Steve Buscemi (actually, especially if you’re Steve Buscemi). You’ve got two choices if your plans change and you’re not going to take one of those flights:

  • Pay the fee to cancel if you can, or just eat the ticket cost if you can’t
  • Play the odds and hope that you don’t need to do either of the above

Playing the odds means waiting for the airline to offer free changes or refunds due to one of:

When one of those things happens you won’t be taking off for Lubbock, but instead you’re headed to refund-town (but you’ve probably got to request the refund from the airline, and in some cases before departure). The odds aren’t great though; at best the chances of this working are somewhere between 1/6 and 1/10, unless you own a pregnant turtle.

The Gotchas

There are a few ways this can malfunction:

  • You forget to cancel before the cancellation window expires after the game didn’t work, which matters especially with programs like Virgin Atlantic that require you to cancel before the check-in window opens
  • You don’t request a refund in a timely manner from the airline
  • The airline disagrees about what a significant delay is (but 2+ hours is usually sufficient)

Personally I put a reminder in my phone for an hour before the flight or cancellation window, whichever comes first, to figure out whether the stunt is going to work and to pay the cancellation fee if I can and it didn’t.

Good luck!

AA’s new Flagship First catering meal concept: “playing chicken with an airline”. They’ll end up cutting the ketchup at launch for cost savings though.

Introduction

One of my favorite travel tools is seats.aero, a site that shows you inventory for award flight redemption availability across about a dozen mileage programs. It’s got limitations in that data is only available for certain routes, award discounts for elites and card holders aren’t included, data isn’t refreshed for hours or days depending on which searches have been run, and plenty of other small things too. But the tool is perfect for illustrating a concept in churning and travel hacking: By finding your perfect redemption, sometimes you also find someone else’s perfect redemption.

Background

I was looking for space to open on an international First award, and while I generally knew about when award space opened up on the potential routes that I wanted to fly, I wanted to fine-tune the timing with fresh data-points. So, a few weeks before when I thought the route would open:

  • I looked for where inventory was opening up on the routes I might take, using seats.aero and a couple of airline partner’s mileage programs
  • I saw that the routes I wanted usually opened up the morning US time, and usually 3-5 days out
  • I also saw that seats.aero wouldn’t see inventory right away, exactly as expected given how it works

My takeaway was that at five days out, I needed to search for the inventory I wanted every couple of waking hours, but especially in the morning.

The Ouchee

Starting five days out, here’s what happened:

  • T-5: No inventory
  • T-4: No inventory
  • T-3: No inventory

I did have a backup flight booked on British Airways, so there wasn’t a concern about getting home, but it’s British Airways. So late on the evening of T-3, let’s call it approximately T-2.5, I used seats.aero to look at business class availability on major routes from Europe to my preferred US airport to see what my best options were that weren’t British Airways.

Seats.aero showed plenty of cached results for my search, and I began investigating those on different airline websites. While I was exploring, seats.aero was running a real-time search in the background in another browser tab. I kept exploring and saw a notification from seats.aero pop-up, but because I’d just looked for space and it wasn’t there, I assumed the alert was for some other route that I was also monitoring.

Fast-forward a few minutes later to when I looked at the alert. It was for the flight and route that I wanted! So, I confirmed the space with a partner airline’s award search, then started to book it. But, the space vanished before I could complete the booking.

What happened? I’m certain that someone else had a seats.aero alert for the same route that I did, and they got the same alert after my real-time search showed that space had opened. Because I delayed by a few minutes, they got the flight before I did, and they found out about the flight because of me too.

The Band-Aid

I was annoyed at myself for a couple of minutes, but in my research I found that when one route had award availability open up, other routes usually did too. Since I’d only searched for one airport, seats.aero had only refreshed its inventory for that airport. No other alerts for other routes had likely gone out.

I searched my second best airport option, and First space was open there too. I booked that instead and got (mostly) the redemption I wanted.

The Takeaway

When you use a tool like seats.aero, PointsYeah, point.me, or Award Tool, that alerts based on the results it finds, you might trigger alerts for your competition too. When space really matters, consider skipping those tools and use airline award sites directly.

Of course the concept applies to manufactured spend, churning, and other branches of travel-hacking too, the implementation is just slightly different.

Happy hacking!

The magnitude of my ouchee.