Why I’m Addicted to Credit Card Bonuses: Makauwahi Sinkhole in Kauai
I don’t promote many credit cards on this site but I do have a lot of experience with them. Right now I’ve got about 25 open credit cards and if I had to guess, I’ve probably accrued over a million miles and points over the last 3-4 years. I’m always looking for easy ways to make money and credit card sign-up bonuses are right up there.
A lot of people don’t understand how credit works and therefore have a lot of apprehension when it comes to opening up new cards. I always get skeptical looks when I tell people how easy it is to make $500 doing about 5 minutes worth of work but at one point I didn’t believe it either. There’s definitely some more work that goes into managing 25 cards but as long as you’re organized it’s not that hard. You won’t need a college degree to manage a bunch of credit cards, trust me.
In it For the Money?
You might think I’m in the points and miles game for the money, but you’d be wrong. It’s obviously a huge bonus that I get paid around $500-$1,000 for every card I open but that’s not why I do it. I started off signing up for cards because I couldn’t believe companies were willing to give me 50,000 points just for opening a new credit card. Did they realize I was just going to spend the minimum amount required and then never use the card again? Before long, I was hooked and I wanted to see how many more cards I could get and how many more points I could rack up.
It’s now gotten to the point where it’s me(and a bunch of other people like me) vs. the credit card companies. We’re busy figuring out which cards are churn-able, what the waiting time is in-between applications and so forth. It’s like a huge game of chess but my side is definitely winning. For the casual credit card user, it really only takes a few minutes a year to manage a single card. But as you get more and more cards, the work you have to put in goes up exponentially. So the question is, is it all worth it?
Is it Worth Your Time?
Some people like to play video games, some people like to read and some people like to exercise. We all have our hobbies but signing up for credit cards happens to be one of my hobbies. I don’t spend as much time doing it as some other people but I like reading travel blogs, perusing the forums on FlyerTalk from and writing my own travel hacking article once in a while. Most of us don’t pick hobbies that will make us money – we do things that we enjoy. But when one of your hobbies happens to line up with a viable money making opportunity it can be a great thing.
I think the reason why I like signing up for credit cards is that there is really no greater feeling than traveling for free. I paid for my entire last vacation to Hawaii using points and it was amazing. We probably wouldn’t have even gone on the trip in the first place if I wasn’t able to get free flights, car rental and a hotel room for four nights. I’m sure I would have still enjoyed the trip just as much if I paid in cash but it’s nice being able to fly business class, stay in an ocean view suite and live that ‘A’ lifestyle while only making ‘B’ money. Normally I would never pay a thousand dollars a night for an ocean view suite but if it’s free, hey I’ll take it!
The reason why I’m so addicted to credit card sign-up bonuses is that it allows me to experience things I would never pay for or could never afford on my own. I don’t make enough money to fly us business class to Europe during the peak of summer but with my points I can. There’s obviously an opportunity cost to using points on all these trips since I could potentially sell them for about 1 cent per point or cash them out for gift cards at stores I frequent. But since I treat credit card sign-up bonuses like a hobby I don’t care how much money I make off them. I care about the travel experiences they allow me to enjoy. I’ve only been doing it for a few years but so far I’m hooked.
Readers, what do you think about signing up for credit card bonuses? Are you as addicted as I am? Is there any better feeling than flying business class to Europe for free or getting an entire trip paid for using miles?!
-Harry @ PF Pro
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I’m addicted. All it took was a free trip to San Francisco and free accommodations and travel to FinCon13. Now my trip planning always starts with “which credit card rewards are going to pay for this?” LOL!
I love to travel Rebecca, but the two limiting factors are vacation time and money. CC’s don’t help with the first issue but when you can stay in a hotel for free or travel in business class for $100 in taxes/fees, it is a GREAT feeling. I love it.
Some people argue that they cause you to spend more money than normal but it’s all about self-control. I paid for my entire trip to Hawaii with points and I wouldn’t have gone if I didn’t have the points. But I’m also paying for a majority of my 2 week European honeymoon with points(flight there, flight back, two flights while i’m there, 8 hotel nights)
I wouldn’t say that I’m addicted to credit card bonuses by any means because I’ve only done two so far, but it was definitely pretty easy. I’m still using the Barclaycard even though I hit the minimum spend because I found enough travel expenses for the year to make it easy to redeem the points in the most effective way. I’ll definitely give it up before the annual fee hits though and go back to using my Fidelity Amex for everything.
You’re definitely not addicted but I think you and I think alike. We know how hard it is to make $500-$1,000 tax free so when an opportunity like this comes along with literally no downside(if you apply in moderation) it’s too hard to pass up!
I find the best travel hackers treat it like a hobby. It’s a pretty time-consuming thing to do, so you gotta enjoy it at least a little bit. I can see the benefits, but it just seems so tedious for me. I wish I could get into it, but I don’t see it happening!
You’re right, there’s definitely an exponential correlation the more you do. That’s good that you at least know it’s not for you and aren’t forcing yourself into it just b/c everyone else is doing it. Find something you enjoy and do it well 🙂
25? Really? I think that’s a lot of credit card for an individual to handle.
As for the credit card rewards that one can get, I will be more likely get a credit card that would give me free trips than store discounts for the simple fact that I enjoy traveling.
I don’t use all 25 cards, most of them just sit in my drawer and I use Square to charge $1 on the inactive ones every 6 months or so. I log each one into a spreadsheet and that’s about all it takes, management wise. These cards are paying for 70% of my lodging/flight costs for a 2 week European honeymoon so I’m pretty happy with them.
Wow! I have been reading a lot about this and want to try, but what I am trying to figure out is: what is the effect on your credit score a) having so many cards open, and b) what happens if I close the card before the annual fee hits?
Good questions. Every time you open a new card your score goes down a little bit due to the hard inquiry and lowering of your average age of accounts. But it also goes up since you’re adding a new account(the more accounts the better – little counterintuitive) and increasing your credit limit(lowering your utilization rate).
B) Nothing happens, your number of accounts will be reduced, average age may go up or down, credit limit goes down. So that’s why you never wanna close your oldest cards. Most companies will actually waive the AF if you call in and complain, allow you to downgrade or last resort, you just cancel the card.
So I guess it all evens out in the end! Thanks for the answers!