Author Topic: Once you do the Credit Card Churn.....  (Read 6178 times)

whitedragon

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Once you do the Credit Card Churn.....
« on: November 04, 2014, 12:57:35 PM »
What do you actually do with the rewards?

Any Mustachians want to weigh in?

I'm 6 months in to changing my lifestyle, and I'm at a weird situation where I can infact meet the spend requirements of a couple credit cards to take advantage of the rewards, but after that, I'm not really sure what to "do" with the rewards once I have them.  For example, I'm looking at the Marriott card (70k bonus points sign on bonus) and the Chase Ink (70k sign on points), and I can do both of them, but then I'm thinking, do I reward myself and my wife with a trip with those points, or do I take the cash back instead and just buy some more stock/IRA/savings/whatever...

I mean, the expenses I'll be experiencing over the next few months are unavoidable anyway, but do I try to use the rewards to "lessen" the burden", or is it really a good idea to take a trip for almost free and enjoy it?

I feel paralyzed by indecision, and almost a little "guilty" in the thought of taking a trip after spending so much money.

Anybody have any perspectives?

PloddingInsight

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Re: Once you do the Credit Card Churn.....
« Reply #1 on: November 04, 2014, 01:11:36 PM »
I use cards with cash back options, so I just take a statement credit and go on with my life.  It has no affect on my spending.

solon

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Re: Once you do the Credit Card Churn.....
« Reply #2 on: November 04, 2014, 01:13:55 PM »
I use cards with cash back options, so I just take a statement credit and go on with my life.  It has no affect on my spending.

Yeah, but what do you do with the statement credit? I think that's the OP's question.

JimLahey

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Re: Once you do the Credit Card Churn.....
« Reply #3 on: November 04, 2014, 01:23:57 PM »
I use cards with cash back options, so I just take a statement credit and go on with my life.  It has no affect on my spending.

Yeah, but what do you do with the statement credit? I think that's the OP's question.

I believe he means that he uses his cash back credit to pay down his outstanding credit balance.

DrF

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Re: Once you do the Credit Card Churn.....
« Reply #4 on: November 04, 2014, 02:14:05 PM »
Personally, I am saving up to take a trip. I would NEVER pay to take a fancypants vacation at some remote destination in a luxury hotel, but by getting it paid for with points, I think I would really enjoy myself.

themagicman

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Re: Once you do the Credit Card Churn.....
« Reply #5 on: November 04, 2014, 02:25:10 PM »
We have done a little bit of both. In the past we have signed up for many cards that give large cash back bonuses that we would put towards our income that month.

Recently we signed up for serveral cards with  a trip in mind and reached the min spend on all of them.

We were able to fly to paris, stay 4 nights, then fly to rome and stay 5 nights and then fly home...All completely free for us from credit card points.
I think it depends on where you are at financially for which to do. If you are needing cash and savings then the cash back card bonuses are better. If you do not, then the travel cards have much higher worth (Our trip would have been about $13k if we would have paid for it)

Kingomri

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Re: Once you do the Credit Card Churn.....
« Reply #6 on: November 04, 2014, 02:50:18 PM »
If a card has the ability to use points for cash or useful gift cards (e.g. Walmart or Home Depot, not things like restaurants), I tend to use those for cash/GCs, even if the points are "worth more" when used for travel. So with the Chase Ink, I'd just cash out $700 in cold hard cash. Important to note: for the gift cards, I'll really only get something where I would have been spending money anyways. I needed to put in insulation, so my AmEx Membership Rewards points went towards Home Depot gift cards to use for this, making my insulation project nearly free!

Then, for my travel, I use points I get from co-branded cards, like the Marriott card in your example, or something like the Citi American Airlines card. We don't travel enough to really burn through points quickly, so these are usually more than sufficient.

One somewhat odd case is something like the Barclay Arrival card - you can redeem 2,500 points for $25 in travel statement credits or $12.50 cash. In this case, I'd go with the travel credits, which I feel like somewhat goes against my first example, but twice the value is pretty hard to pass up.

themagicman

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Re: Once you do the Credit Card Churn.....
« Reply #7 on: November 04, 2014, 03:02:29 PM »
One somewhat odd case is something like the Barclay Arrival card - you can redeem 2,500 points for $25 in travel statement credits or $12.50 cash. In this case, I'd go with the travel credits, which I feel like somewhat goes against my first example, but twice the value is pretty hard to pass up.

For cards like this one (and the cap one venture card) where you have to spend the rewards on travel. One thing that I started doing was going to the casino on cruises. My wife and I go on cruises a lot. I go to the casino and ask for x amount in chips. This is charged to your cruise account which is charged to your credit card as a travel expense. I then just cash the casino chips in for cash and deposit it once I get back.

I sure there are other ways people do things like this!

MustachianWays

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Re: Once you do the Credit Card Churn.....
« Reply #8 on: November 04, 2014, 03:05:23 PM »
I'm just now trying it out with one card because I have to travel across the country for a wedding next year. I would rather fly for free than have the money come out of my monthly savings that would otherwise begin earning compound interest. In the future I might begin to plan free trips around any miles/rewards I accumulate.

solon

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Re: Once you do the Credit Card Churn.....
« Reply #9 on: November 04, 2014, 03:06:43 PM »
One somewhat odd case is something like the Barclay Arrival card - you can redeem 2,500 points for $25 in travel statement credits or $12.50 cash. In this case, I'd go with the travel credits, which I feel like somewhat goes against my first example, but twice the value is pretty hard to pass up.

For cards like this one (and the cap one venture card) where you have to spend the rewards on travel. One thing that I started doing was going to the casino on cruises. My wife and I go on cruises a lot. I go to the casino and ask for x amount in chips. This is charged to your cruise account which is charged to your credit card as a travel expense. I then just cash the casino chips in for cash and deposit it once I get back.

I sure there are other ways people do things like this!

Brilliant! I wonder how many times you could get away with this? Could you do a complete buy/sell once per day?

themagicman

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Re: Once you do the Credit Card Churn.....
« Reply #10 on: November 04, 2014, 03:16:43 PM »
One somewhat odd case is something like the Barclay Arrival card - you can redeem 2,500 points for $25 in travel statement credits or $12.50 cash. In this case, I'd go with the travel credits, which I feel like somewhat goes against my first example, but twice the value is pretty hard to pass up.

For cards like this one (and the cap one venture card) where you have to spend the rewards on travel. One thing that I started doing was going to the casino on cruises. My wife and I go on cruises a lot. I go to the casino and ask for x amount in chips. This is charged to your cruise account which is charged to your credit card as a travel expense. I then just cash the casino chips in for cash and deposit it once I get back.

I sure there are other ways people do things like this!

Brilliant! I wonder how many times you could get away with this? Could you do a complete buy/sell once per day?

I have probably done it 6 times and no issues. The CC company just sees it as on board spending. I can not think of any way they would be able to stop this.

When you are saying complete buy/sell once per day are you refering to maxing out your credit limit and paying it down once a day? I do not think this would work because I do not believe the ship charges your credit card until you dock. But I have done this with serveral $1,000 dollars to reach credit card minimum spend before

FarmerPete

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Re: Once you do the Credit Card Churn.....
« Reply #11 on: November 05, 2014, 10:12:07 AM »
That certainly sounds like a good (but limited) way to do some MS while cruising!  If you had a card that gave you 5% cash back on travel expenses with a high limit, you could almost pay for your cruise by doing that MS.  I think the challenge would be in how to do 20k in this over a week without getting yelled at.

themagicman

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Re: Once you do the Credit Card Churn.....
« Reply #12 on: November 05, 2014, 10:38:32 AM »
That certainly sounds like a good (but limited) way to do some MS while cruising!  If you had a card that gave you 5% cash back on travel expenses with a high limit, you could almost pay for your cruise by doing that MS.  I think the challenge would be in how to do 20k in this over a week without getting yelled at.

And having to keep up with $20k in cash and avoiding questions at customs.

shotgunwilly

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Re: Once you do the Credit Card Churn.....
« Reply #13 on: November 05, 2014, 10:45:17 AM »
That certainly sounds like a good (but limited) way to do some MS while cruising!  If you had a card that gave you 5% cash back on travel expenses with a high limit, you could almost pay for your cruise by doing that MS.  I think the challenge would be in how to do 20k in this over a week without getting yelled at.

And having to keep up with $20k in cash and avoiding questions at customs.

You can request a check at casinos. Still.... gonna raise some red flags to the bank.