A Beginner’s Thoughts on Travel Hacking


Mrs. Dragon and I are currently in the process of buying a house (woot!).  As such, I’m not going to be doing any credit card churning until the mortgage clears.  But after the dust settles on the mortgage, I’m thinking about trying my hand at travel hacking.  Specifically, credit-card churning.

I’m an adventurer at heart.  Mrs. Dragon is a little more reluctant sometimes, but we both love to travel.  So if I can figure out a way to make travel hacking work for us, that would be a HUGE win for a frugal pair like us.

For the uninitiated, I’m talking about signing up for a bunch of credit cards, getting the sign-up bonuses (airline miles mostly), and then cancelling the cards after the first year.  A few comments:

  • Maybe just read that first one again.
  • In general, you need excellent credit to make this work.

Sorry I had to yell at you, but the all caps above really cannot be overstated.  I know it’s tempting, but just don’t do it if you don’t already have a firmly established healthy relationship with credit cards.

Just to be clear, I have never “churned” any credit cards before.  I’ve thought off-and-on about trying it for a while, but I always end up deciding that since Mrs. Dragon and I are pretty frugal, there is no way we would be able to meet the minimum spend limits to get the bonuses.  Oh, didn’t I mention?  You have to spend a shit-ton of money (in most cases) on these newly opened cards in order to get the sign-up bonuses.

For instance, there is an American Airlines card I’m eyeing that requires you to spend $3000 in the first three months of opening the card to get the 50,000 AAdvantage miles sign-up bonus.  That’s a lot of dough.  Especially when you consider that most “churners” sign up for 7-15 cards at once!

But it turns out I was missing a piece of the puzzle.  Enter “manufactured spending.”  This is the term that churners use to describe tricking your credit card into thinking you’ve spent money that you haven’t.

Essentially, the story goes like this.  You open some credit cards.  You then go to a store that will sell you Visa or Mastercard gift cards, and buy $1000-$2000 worth of gift cards on your credit card*.  Then you use a service like Bluebird to put the gift card balances into an account you can pay bills from.  Finally, you use Bluebird to pay your credit card bill.  Voila!

Your credit card company thinks you spent a bunch of money on your new card, but really you just moved money around and paid ~$5 in fees.  Talk about gaming the system.

To summarize, you don’t have to spend ungodly amounts of money to churn credit cards.

This was news to me.  Here is a really excellent beginner’s guide to travel hacking.  This is the article that opened my eyes to the possibility that maybe churning would work for me.

I’ll be sure to keep you posted when I try it out post-mortgage.  Stay tuned!

Have you ever churned credit cards?  Got any advice for us beginners?

*Not all stores will let you do this apparently.  You have to put in some leg-work to find stores in your area that are OK with putting gift cards on credit cards.

Other posts in this series:

The Travel Hacking Experiment: Part I

The Travel Hacking Experiment: Part II

The Travel Hacking Experiment: Part III

The Travel Hacking Experiment: Part IV


The Hoard
Expenses: February 2015

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Every good dragon has a hoard.  You know.  The collection of gold, jewels, and other valuables that the dragon guards...