How are we able to get the most bang for our buck? Nowadays one of the easiest ways to do so is through credit card churning. Basically you sign up for a credit card, get the sign up bonus, and move on to another credit card. There is a lot to the whole scheme but here it is simplified.
Amount of points earned after meeting the spend requirement.
Each point has a dollar value depending on the program.
The amount you have to spend in order to get the bonus. Typically you have a time requirement as well.
Think about that, every $1 you spent, you earned about 20 cents! If you game the whole system, you can earn substantial travel in any given year. From my experience, on average most sign up bonuses earn roughly 18 cents per dollar spent. I like this evaluation metric the best because you can see how to get the most out of your money.
This formula is a simple one, but may need to be altered depending on a variety of factors. Such factors include but not limited to annual fee, travel credits, extra points earned, etc.
This example gives us 80k points after spending $2000. Now you will earn extra points as you spend on the card, but for the purposes of this example, we are not adding that to our calculation. When researching the internet we find that each Hilton point is worth roughly $.005.
Credit Card Sing Up Bonus Rules
5/24 Rule – If you applied for 5 or more credit card in the past 24 months, your application will be rejected.
1/30 Rule – If you applied for 1 or more credit card in the past 30 days, there is a chance your application will be rejected.
You can only get the sign up bonus during your lifetime to any particular card. However you can get the sign up bonus for the different card variations. HOWEVER, if you just so happened to have ever upgraded or downgraded to the card, that could also waive your sign up bonus!
5 Credit Card Limit – Can have no more than 5 credit cards.
3/3 – If you applied for 2 or more credit card in the past 3 months, there is a chance your application will be rejected.
Closing Procedures
Strategies
Try double teaming the sign up bonus game with your spouse! Be careful though, if you add them as an authorized user, it can hurt their chance of getting approved.
Credit Card Travel Partners
The big 3 (Chase, Capital One, AmEX) all have major travel partners for airlines and hotels. These are the transfer rates. If no transfer rate is listed, then they don’t transfer.
Please use your own research because this can get outdated pretty quickly.
