Personal Finance Rewards Credit Cards

Credit Card Churning 101: A Guide to Hacking Rewards Programs

Elizabeth Aldrich

America the beautiful, where we all have certain unalienable rights – like the right to life, liberty, and the pursuit of credit card debt.

Credit card companies are notorious for playing the vulture, preying on consumers while they fall into massive debt holes. But among the wreckage of repossessed homes, massive student loans, and debt collection agencies that have popped up in the last decade hides a group of people who have figured out how to game the system and take advantage of the credit card companies. They’ve been scoring freebies left and right, drinking Dom Perignon on a Miller High Life budget, so to speak, all without acquiring a single penny in debt. They call themselves credit card churners.

Their grand scheme? Apply for credit cards, gather bonuses and rewards, cancel credit cards, repeat. Survey the loot and milk it for all it’s worth.

So what exactly are these credit card rewards worth? Everything from first-class vacations and luxury ocean-view hotel rooms to paying off student loans, if you know how to play your cards right.

A Credit Card Churning Success Story

Emily and Duraius were your typical middle-class couple leading normal lives in Bloomington, Indiana, him a graduate student and her a Project Manager, until Duraius discovered a blog post one day on credit card churning. They had always wanted to travel. So, he dipped his toes in, netting some modest rewards by applying for credit cards. After quickly earning a free weekend trip to St. Louis, the two of them were hooked.

After a couple years of churning, Duraius graduated and Emily quit her job, and they went on a month-long luxury trip across Europe, flying coach, staying in high-end hotels, visiting ten different countries, all while spending next to nothing. After that, they went on an extravagant $32,000 honeymoon to Paris, only spending $2,000. Then they went on a second honeymoon to Bora Bora, again spending only $2,000 for a trip that should have cost them $30,000. And their credit scores? They actually increased over time.

So How Do They Do It?

Simply put, credit card churning is the act of signing up for multiple credit cards in a short time period in order to receive sign-on bonuses and rewards, canceling the cards after the rewards have been received or after the first year is over (many cards will charge an annual fee beginning on the second year), and then repeating the process a few months later with a new set of cards.

About the author

Elizabeth Aldrich

Elizabeth Aldrich

Elizabeth is a freelance writer and “digital nomad” specializing in small business, entrepreneurship, career advice, real estate, travel, arts, and culture. She’s written for outlets as varied as Rawckus Music and Arts Magazine, Itcher Entertainment, Sweden Tips, Houzz, Hometalk, JobHero, Tico Times, and Eugene Weekly. Thanks to a three-year stint in a travel job, a knack for mining great deals, and credit card churning, she has not paid for a single flight since 2012, despite her constant travels. You can find her on Twitter @LizzieAldrich or her website, www.elizabethaldrich.com.

1 Comment

  • What kind of credit score do you need to assure being able to replace your closed cards ?? !
    Also it seems the opening and c would hurt your credit score ?

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