Which cards can you churn for multiple rewards bonuses?
By Cathleen McCarthy
Cathleen McCarthy is a journalist whose articles on travel, commerce and consumer topics have appeared in dozens of publications. She writes "Cashing In," a weekly column about credit card rewards programs, for CreditCards.com
Ask a question.
'Cashing In' archive
Dear Cashing In,
carrying a few rewards cards that I took on primarily for the sign-up bonuses.
I was surprised how easy it was to collect so many points for free, except for
keeping the cards active and hitting spending minimums for the bonus points.
But that was because annual fees were waived the first year. This year, I have
to decide whether to cancel and open different cards or start paying fees. The
cards I use most are Sapphire Preferred Visa, Starwood AmEx and Barclays US
Airways card. My question: Can I drop any of these cards and sign up for them
again in order to get the sign-up bonus again and avoid paying annual
fees? -- Jake
You can get away with that with some cards, but not all. It tends to come down to
the issuing bank. Canceling cards and signing up for them again to maximize
bonus points is a practice known as "churning." Some banks make that easier
Chase Sapphire card -- or any Chase card in your wallet -- is pretty much
churn-proof. Chase has a policy of one sign-up bonus per card per customer. Right
now, your Sapphire Visa comes with a sign-up bonus of 40,000 Ultimate Rewards.
You're looking at a $95 annual fee, which was waived the first year. If you value
your Sapphire card, don't expect to cancel it and get a new one with another 40,000
points and waived fee.
According to frequent flier bloggers, Chase does make an exception to this rule when it discontinues a card you're carrying and reissues a new version. In that case, you
can sign up for the new version and score the sign-up bonus.
your Starwood American Express, you're facing a $65 annual fee, waived the
first year. Right now, the card is offering a 25,000-point sign-up bonus. Terms
and conditions for this card say that the bonus offer is not available to
applicants who have had the product within the past 12 months. The Starwood
card offers an incentive for sticking around and paying the annual fee: a
Starwood credit for two stays and five nights toward elite status, upon opening
the account and each year you keep it open. Then
again, you'd get that with the new card anyway.
more premium American Express Platinum ($450 annual fee) has stricter rules.
Its terms and conditions state that the bonus offer -- 25,000 points when you spend $2,000 in your
first three months -- is not available to anyone who's had the card
within the past 12 months or any Green or Gold Card account within the past 90
days. The website also states that the offer is valid for first-time platinum
card members only.
US Airways card may be the easiest to churn, but you won't avoid the annual fee
because it wasn't waived the first year. You will have paid your first year's
fee in order to receive your sign-up bonus -- an $89 annual fee for the Premier
World Mastercard's 30,000-mile sign-up bonus or a $49 annual fee for the World
Mastercard's 15,000 miles, both awarded on first use. Barclay generally lets
cardholders sign up repeatedly, although the rule of thumb is to wait 90 days.
Some miles collectors find those bonus miles worth the fees. In particular, $89
for 30,000 miles -- which more than covers a first-tier domestic round-trip --
seems like a bargain.
couple words of caution: Leave your oldest card(s) alone to maintain credit
history and don't open and close multiple accounts if you have a loan in the
offing, lest you ding your credit. If you do cancel a card, make sure you've
either used or protected your points first. With Chase, you can transfer
Ultimate Rewards points to another account that uses them. With US Airways, any
miles earned in the current billing period will vanish if you cancel, so pay up
for that month before you close the account.
See related: Credit card bonuses playing hard to get, 3 trends shaping today's rewards credit cards, Consider your credit when pursuing card sign-up bonuses
Meet CreditCards.com's reader Q&A experts
Vexed by a personal finance problem? CreditCards.com's Q&A experts answer questions from readers every weekday. Ask a question, or click on any expert to see their previous answers.