How to Churn Credit Cards for Maximum Rewards

Churning credit cards can be a great way to rack up rewards, but it's essential to do it strategically. To maximize your rewards, focus on credit cards with high sign-up bonuses, which can range from $200 to $1,000 or more.

The key is to apply for multiple credit cards in a short period, typically within 90 days, to meet the spending requirements and earn the bonuses. This is often referred to as a "churn" and can be done multiple times per year.

However, be aware that applying for too many credit cards in a short time can negatively impact your credit score. Aim for 3-5 applications per year to maintain a healthy credit profile.

To avoid overspending and meet the minimum requirements, create a budget and prioritize your spending on the cards with the highest rewards rates.

Intriguing read: Does Having More Credit Cards Hurt Your Score

Credit card churning is a tactic used by advanced credit card users to capitalize on a credit card's introductory offers, which often include airline miles, redeemable points, or cashback rewards.

These rewards are designed to entice new customers to sign up for a credit card, and they can be quite lucrative. A skilled credit card churner looks for multiple cards offering the rewards they want.

To earn the reward, you need to apply for the card, get approved, and then fulfill the spending requirements. This can be a challenge, but it's worth it if you can get rewards for free.

The key to successful credit card churning is to find cards that offer the rewards you want and to apply for them strategically. It requires airtight organization, tracking, and discipline to make credit card churning work.

By paying off any balances before the billing period ends, you can avoid paying interest and annual fees, making the rewards even more valuable.

Recommended read: Credit Cards with Gift Card Rewards

Credit card churning can help you save a lot on your expenses, especially on travel, airport lounge access, hotel stays, online shopping, and movie tickets.

With credit card churning, you can earn a huge sum as sign-up bonuses, which can be very high on some cards. This is one of the major highlights of credit card churning.

You can customise your credit card rewards according to your needs and lifestyle by using multiple credit cards to take advantage of various benefits offered by them.

Some credit cards offer additional points and rewards, while others offer high discounts, so you can use these cards according to your present requirements.

If you have the organisational skills to pay your balances off ahead of the billing date, meet all of the spending requirements, and avoid annual fees, then credit card churning might be for you.

Here are some of the benefits of credit card churning:

Credit card churning can be a great way to boost your frequent flyer points balance, but it's essential to consider the potential risks. You should only change credit cards every 12-18 months, as more frequent changes can impact your credit score.

To avoid expensive interest bills, always pay your balance off in full each month. If you can't afford to spend a certain amount within a few months, don't commit to it – missing the minimum spending requirement can result in no signup bonus.

A good tip is to get a credit card just before you're about to make a big purchase. This can help you meet the spend criteria for the bonus points, but be careful not to overspend and end up in more credit card debt.

Credit card churning can be a effective way to boost your frequent flyer points balance, but it's not without its risks.

You can earn a generous amount of points, up to 100,000, by applying for a credit card with a lucrative bonus point offer.

Most bonus points offers require you to spend a certain amount in the first few months, which can be as much as $3,000 or more.

To avoid paying the second-year annual fee, it's essential to pay off the card and cancel it after you've earned the bonus points.

If you're churning cards, you should only apply for another introductory credit card offer every 12-18 months to avoid impacting your credit score.

Make sure to always pay your balance off in full each month to avoid expensive interest bills.

On a similar theme: How Long after Paying down Credit Cards Improve Score

Credit card churning can be a great way to earn rewards, but it's essential to consider the potential risks. You need to be organized and disciplined to avoid getting carried away with spending requirements.

If you can't afford the spending requirements, don't commit to them. Missing the minimum spending requirement can mean you won't get the signup bonus, and you might end up in more credit card debt.

The typical process for churning credit cards involves searching for cards associated with your preferred airline or issuer. This can be a good way to find cards that align with your needs.

For your interest: What Is Churning Credit Cards

To churn credit cards effectively, you need to apply for a card, meet the bonus point spending requirements, and then pay off the card and cancel it. This process can be repeated, but be careful not to do it too frequently, as this can impact your credit score.

Here are some key considerations to keep in mind:

Credit card churning can affect your credit score in several ways, including hard credit inquiries, changes to credit utilization, and the average age of accounts. It's essential to be mindful of these factors to avoid damaging your credit score.

Annual fees can be a significant consideration when it comes to credit card churning. They range from $100 to $1,200, depending on the card.

Most credit cards have an annual fee, which you'll pay when you sign up, then every 12 months after that. The higher the points, the bigger the fee.

You might be able to catch a card with a first year free, but after that, it automatically renews for the full price. If you forget to cancel the card or downgrade before the annual fee hits, it's even more expensive.

To avoid these fees, it's essential to pay attention to your card's terms and conditions. You'll likely pay your first annual fee (and maybe the second) before receiving the full amount of points advertised. These aren't free points.

Here are some key things to keep in mind about annual fees:

Credit card companies have unwritten policies to discourage churning, which means they might revoke bonuses if you close your account within the first 12 months.

Some card issuers don't let you meet spend-based requirements through purchases of gift cards, prepaid cards, or traveler's checks, so be aware of these restrictions.

Card issuers are increasing spend-based requirements for earning welcome bonuses to ensure you stick around and become a profitable card user.

Credit card providers with cashback offers are a great place to start churning. They often have clear dollar-value rewards, such as $400 when you spend $4,000 in the first 3 months.

Frequent flyer credit cards with large bonus points offers are the best credit cards to churn. These cards give the best bang for your buck.

For example, 100,000 Qantas or Velocity Points can be redeemed for multiple reward flights, worth hundreds of dollars.

Related reading: Best Use of Chase Sapphire Reserve Points

Many credit card issuers will waive the annual fee for the first year to attract new customers. This is a great way to try out a card without committing to the long-term cost.

You can get a lot of value out of a credit card with a waived annual fee, especially if it comes with a promotional offer. For example, a card might offer $400 in cashback when you spend $4,000 in the first 3 months.

Just be sure to close the card or downgrade to a credit card option with no annual fee before your 12th billing cycle arrives, or you'll be stuck with the fee.

Chase, for instance, has a 5/24 rule that prohibits customers from opening a new credit card if they've opened more than five credit card accounts within 24 months. This means you might not be able to keep a card with a waived annual fee if you've already opened too many cards recently.

The key is to find a card that's valuable enough to hold onto, and to be mindful of the rules that credit card issuers have in place to prevent churning.

Suggestion: What Is the 5 24 Rule for Credit Cards

Citibank has a unique approach to credit applications. They follow the 8/65/90 rule, which means you can only apply for credit every eight days, with no more than two applications within a 65-day period.

Business owners are subject to a slightly longer timeframe, with a limit of one business credit card application every 90 days.

This rule is in place to help prevent over-application and potential credit risks.

Readers also liked: Credit Card Size Business Cards

Bank of America has a 2/3/4 rule for card churners, which means you can only be approved for two cards every rolling two months, three cards every rolling 12 months, and four cards within 24 months.

Most of their cards also block new bonuses if you received one in the past 24 months.

If you're looking to churn credit cards for points, frequent flyer credit cards are a great place to start. They often offer large bonus points offers that can be redeemed for multiple reward flights.

Credit cards with large bonus points offers can give you the best bang for your buck. For example, 100,000 Qantas or Velocity Points can be redeemed for flights worth hundreds of dollars.

Redeeming points for flights can be incredibly valuable. If you redeemed 36,800 Qantas Points for a return business class flight from Sydney to Melbourne, you'd get around $1,400 value from the points.

0% APR offers are a fantastic perk for credit card holders, especially when transferring a balance from a high-interest card.

These offers typically last 12-21 months, giving you a significant amount of time to pay off your balance without any interest charges.

The no-interest period is a great opportunity to pay off your balance in full, or at least make significant progress, before the standard interest rate kicks in.

After the no-interest period ends, any remaining balance gets hit with the standard interest rate for that card, so it's essential to have a plan in place to avoid accumulating debt.

Expand your knowledge: Credit Union Balance Transfer Cards