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Rumors of Churning Demise Have Been Greatly Exaggerated

By now, you’ve probably heard the terrible news about new Chase policy regarding their branded cards, not to be confused with co-branded offers. For those who have been living under a rock, here is the deal in a nutshell: Chase will not approve anyone who has added 5 new cards to their wallet within the last 2 years. They don’t just count credit pulls, but ALL cards from all the banks, including those where you are an authorized user.

Once again, for now, this new policy only affects Chase Freedom, Chase Sapphire Preferred, Chase Ink and Chase Slate. Cards like Chase British Airways Visa, Chase Southwest etc. are OK. For  in-depth discussion and all the latest developments, follow this thread on Flyertalk, specifically the WIKI. This will be your best bet for staying in the loop.

So, does this mean the sky is falling…again? Nope. In this hobby the only constant is change. What is true today may not be true tomorrow. You have to stay calm and adjust accordingly. Of course, it’s a bummer that Chase instituted this new policy and I really wish I would have applied for CSP card in April while I still could. I did get my husband’s app approved in March, phew!

But not to worry, Chase has plenty of cards to keep me busy for the foreseeable future. Remember, you can get the bonus  24 months after receiving it on that specific product. Originally, I planned to get CSP card in December. It looks like I’ll have to swap it for Chase British Airways Visa. I hope to redeem Avios for our next trip to Europe to visit my family. I’d like to fly out of Dusseldorf to Fort Myers, where the route costs 25,000 Avios on Air Berlin with no fuel surcharges.

So, it looks like it might be wise to pick up 2 Chase BA Visas, one in mine and the other in my husband’s name. After that, it will be Southwest cards’ turn…again. Don’t worry, Marriott, I’ll get to you too eventually. You know, I have a soft spot for miles. But I love hotel points too! That was crazy Julia talking.

Anyway, my point is: There are plenty of offers to go around, at least for now. In a way, it will make things easier for me. I won’t have to wonder where to speculatively transfer Ultimate Rewards from my husband’s CSP before canceling it. What, you didn’t think I would actually renew it, did you? There is a lot of talk about how you should hang on to your Ultimate Rewards-earning cards because you may not get approved for them again. Tune it out.

If CSP wasn’t worth paying the annual fee before, then really, what has changed?  To me, nothing. I’ve cancelled both mine and my husband’s  cards in the past when Chase had 1 bonus/per lifetime rule (reportedly not enforced). Of course, as I’ve said many times, I constantly switch cards, so will only renew those that give an annual perk.

Most (normal) people are not like me. Honestly, while the ROI is unbeatable when you collect sign-up bonuses, it does get a little crazy trying to constantly juggle cards. In a  way, I secretly hope the banks will cut off churners like me, so I could just get a few good cards and call it a  day. Yup, I’m a glutton for punishment. Why do you think I got into miles and points blogging?

So, you may wonder, what would those cards be? I would probably try to pick up Amex Blue Cash Preferred and Amex EveryDay Preferred. You can read more on them in this post where they are my top picks for a middle-class family. Both have annual fees, but the perks and earnings justify them, at least to me. I would try to purchase Visa gift cards from a grocery store ($500 using each Amex to maximize the payout ratio) and use those for my regular bills that total $1,000 each month. Things like power bill, donations and other stuff I can pay online, no big-ticket items that may need purchase protection. I would use Amex Everyday Preferred for gas and everything else.

My husband gets annoyed by the fact that Amex is not accepted everywhere, so I would probably try to convert one of our Citi cards to Citi Double Cash. Alternatively, I would ask him to use Chase Freedom for everything. When you factor in the fact that it earns 5% on rotating categories, the overall return would probably be close to 2%.

But guess what? I doubt this plan will materialize any time soon. I just picked up Citi Prestige that comes with 50,000 points sign-up bonus. I wrote about it before so won’t repeat myself. It actually has some decent perks which I hope to test out on my upcoming trip to Europe. It comes with complimentary Priority Club lounge access, so  it looks like we will be having “dinner” and alcoholic drinks  in   Dublin and Munich airports. I wouldn’t pay for this perk, but it’s certainly nice to have. You better believe I’ll get my money’s worth in complimentary snacks and booze. In August, I plan to apply for this card in my husband’s name as well.

So for now, other banks seem to accept churners like me with open arms. For how long? Who knows. I sure don’t. But I’ll ride this gravy train for as long as I can. My focus will simply shift to Chase co-branded cards. When the new policy trickles down to those, I’ll focus on Citi and American Express. When Citi and American Express cut me off, I’ll move on to Bank of America and Barclay’s. When no bank will have me, I’ll try to maximize rewards with the cards I currently have or try to convert them to the object of my desire. I look at this hobby as a  windfall, not an entitlement.

What does this mean to you?  

Well, if you are just starting out, it does make sense to get Chase Sapphire Preferred first. Gary Leff was right! You don’t know who he is…yet. Anyway, the barrier to entry is a bit high since it requires $4,000 in spending to get the bonus. If you can easily manage it, great! I envy you because I want this card and I can’t have it. Which in turn makes me want it even more.

If you can’t (don’t want to) have this high of minimum spending requirement, it’s OK to pass on CSP. Perhaps, Chase Freedom might be a better choice. With the latter, you only need to spend $500 in 3 months, something most people can easily achieve. Right now, the sign-up bonus on Chase Freedom is increased, which makes a further case for it.

Plus, you’ll gain a decent no-fee  long-term card. Later on, if you decide to get CSP, you can combine the points and transfer them to a  variety of partners. It would probably be wise not to add your SO as an authorized user unless absolutely necessary, in case you plan to drag him/her into this hobby eventually. And you probably will. It’s addictive as heck!

If you are a type of person who only gets few cards every 2 years, this new Chase policy  shouldn’t really affect you. Chase isn’t trying to turn all new customers away, but only those who they perceive to be unprofitable. Whether this new formula sticks around is anyone’s guess. I have to say, it’s very savvy of Chase to go this route. Thumbs up! I wonder why it took so long. Of course, it’s bad news for people like me, but from a business perspective it makes perfect sense.

If you are a true churner (guilty!), don’t fret. Like I said earlier, you will lose out on flexibility provided by having  Ultimate Rewards points. There is a  silver lining, though. It will make it less appealing to hoard points, and that’s a good thing, right?

I certainly will not change my   upcoming plans. I’ll still transfer some of my husband’s Ultimate Rewards points to Southwest so we can take my parents to Puerto Rico.  We churn cards so we can afford to travel. And travel we will.

Readers, what are your thoughts on this new development?

Author: Leana

Leana is the owner and founder of Miles For Family. She enjoys beach vacations and visiting her family in Europe. Originally from Belarus, Leana resides in central Florida with her husband and two children.

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13 thoughts on “Rumors of Churning Demise Have Been Greatly Exaggerated

  1. I somehow missed out on the fact that you are posting again?! So happy!!

    Chase and I have been avoiding each other for close to a year now. I think that may have to continue. Thankfully Ive got largely what I need for the next year. We plan on doing 1-2 big trips and smaller driving trips.

    Here’s a few things a lot of people will have to wrap their heads around:
    1. pay a few annual fees, especially if you get a free night out of it.
    2. Get some long term cards, and see above. Freedom, like you said, is great because of bonus categories and no AF. And it may make Chase like you more. Please, Chase?
    3. Travel less, churn less. Yes. We don’t all need 3-4 trips a year. We are already playing eith house money. Take it easy.
    4. Be a pig, not a hog.

    I know it’s not sexy, but if we are all stewards of the game, there will be plenty to go around. And people,stop with the “I’m taking my business to Citi!” Talk. Citi is about to do something similar I am sure. Everyone needs to stay home and mow their lawns, volunteer in your community, and quit trying to travel every other month.

    I have this theory that points and miles obsessees have really terrible lawns because they are too busy earning points and traveling to take care of their lawns. Like we are the worst neighbors and community members ever.

    • Hi, Cheapblackdad! Yeah, I’ve posted a few times here and there. Perhaps, I shouldn’t have been so hasty to say my goodbyes. What can I say, I’ve always been “all or nothing” kind of gal. Cheap white gal, that is! I don’t know, ranting mood just started to strike few weeks ago. Not sure if this will continue, I’m enjoying my semi-retirement. I do like the fact that the pressure of daily posting is off. REALLY like it! I just hope that my rants are somewhat useful. Thank you for keeping in touch and your kind words of support.

      As far as your points go, I agree completely. People take this thing personally. It’s not. Chase will do what is in Chase’s best interests. We can get mad about it, but it will change nothing in the end. I plan to continue getting new cards that fit my needs. For how long? Who knows? I’m quite happy with all the travel I’ve got to enjoy so far.

      Agree that some cards are worth the annual fee. Which one varies according to each individual. I encourage everyone to do the math. So often in this hobby people just follow bloggers’ advice. I say: Don’t, including mine!
      “Ten four” on staying home now and again! I find myself overdoing this whole travel thing. And yes, our lawn looks terrible…

      • I do think chase is being a little heavy handed. Its not like they have a new anti churning policy. One could have opened 5 new cards and paid annual fees on all of them faithfully. But thats grounds for denial according to reports. Bizarre.

        Is think they’d be more concerned about obvious MS on their Ink cards. But they must be making a profit from swipe fees there, so this was a more relevant target. But it’s a strange way of addressing signing up for bonuses. Head scratcher.

        Hopefully this too shall pass

    • I agree. Chase will end up weeding out some profitable customers with this new policy. But I guess, they felt they had to do something. No formula is perfect, but this one will flag people like me, without a doubt. Which is what Chase is betting on. I don’t blame them, like I said, it’s nothing personal.
      The deal with Ink card is peculiar. I’m not sure why they haven’t cracked down on it yet. There is no way swipe fees can make up for purchases at office supply stores. I understand that Chase collects around 3% on those, yet it pays out 5 points, good for at least 5% in cash back. If one only spends in that category, the bank is totally taking it in the shorts.The math doesn’t add up unless perhaps they get a kick back from office supply stores? I don’t know.
      Either way, we can’t lose sleep over all these changes. In the great scheme of things they matter very little.

  2. I wish I would have read FlyerTalk before applying for the Chase Sapphire Preferred a few days ago because I was DENIED! 🙁 Now I feel like I’ve wasted a hard credit pull. I guess I’ll wait a few months and then try for the British Airways card. 🙂 It’s all good.

    • @Shoesinks Bummer, sorry to hear that! Dont be too upset, though. Like you said, there are many other options for now. Hope this new policy doesn’t trickle down to co-branded cards.
      but even if it does, other banks are still dangling carrots in front of consumers. I’m happy to take them up on their offers!

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