[Monica]

I have a question about the credit card rewards system. Not sure if this is the right place to post.

I have just started with two Chase cards, United Explorer (already earned the sign up bonus) and Sapphire Preferred (currently working on this bonus).

I hear on the podcast a lot about “working on a new card” and the 5/24 rule with Chase.

My question is, once you have opened the accounts and earned the points, do you then close that account?

(After using or transferring points of course so as not to lose any earned points).

I imagine at some point you have to close accounts in order to apply again in the future and get new sign up bonuses.

I just don’t hear much about this part of it.

For those who are regular points-earners, how do you systematize this part of it?

When do you close accounts, re-apply, etc?

I understand about not closing old accounts so as to maintain a good credit score, etc.

What I’m looking for is specific advice on the timing of opening/earning/closing and then starting back over again.

Thanks everyone!

[Megan]

Never close a card until the year 2 annual fee hits.
Trying to come out of the gate churning is a common newcommer mindset trap.

Miles and points is a marathon, not a sprint.

You are making long term strategic decisions.

Card downgrade/cancelation decisions an extremely strategic part of the game play and it is important to avoid talking about these concepts in generalities as it can lead to user error by over extrapolation:

For your two specific cards:

CSP is a keeper card, your household needs a premium UR earning card to have a horse miles and points race.

You have a 48 month Sapphire time out so assuming it is the only premium UR earning card in your household, you will hold it until you are out of Sapphire Time Out.

When you are ready to reapply, you will downgrade to a Freedom product, wait two weeks and reapply.

The churn window on the UA card is 24 months after SUB.

In year 2 you can choose to downgrade to the UA Gateway or just cancel if the benefits are not worth the annual fee.

If the free bag benefits and two lounge passes add value you can hold until ready to churn.

[Dee]

You don’t have to close accounts to get new cards. It’s smart to space them out, however, so that you don’t have many hard queries on your credit report at one time (too many seems like you’re chasing credit and won’t be able to pay them back, thus lowering your credit score).

For Chase sponsored cards, they won’t let you open more than 5 new credit card accounts in 24 months, but not all credit card sponsors have that limitation.

Each new card will lower your average age of credit which can temporarily ding your credit score.

This may not matter if you’re not planning to get a mortgage or large car loan in near future.

And you can close accounts, but it may not look favorable to lenders if you open and close a bunch of accounts in a short amount of time.

Many people just keep them open with a small subscription and auto pay it to keep that available credit high.

[Rick]

Yes people close cards but it’s not a common as you may expect. CSP and Cap1 Venture cards are usually kept as great everyday use cards.

Hotel cards are often kept as the free night cert often has much greater value, if used, than the annual fee.

Airlines cards are ehh since they rarely have an ongoing perk other than free checked bags and that is a very specific use and as the points are rarely tied to the actual card so you can cancel the car without worrying about losing points.

Now the last two years we have seen far more “premium” cards with big big annual fees so I am sure these don’t last and are often closed when benefits are used.

I got 20-25 cards over 3 years, prepandemic, and I think I closed maybe 7-8 of them.

[Chris]

Binge listen to the Travel Mom Squad podcast from the beginning. It’s gold.

They also have a FB page and blog but the pod is how I got started and have now hacked 3 vacations thanks to their free advice.

They answer common questions like this.

Good luck!

[Bridget]

You don’t have to close accounts. With Chase, it’s better to downgrade to a free product, but I’ve had the Chase sapphire for years and (in my opinion) it’s a card worth keeping.

[Steve]

Start an Excel spreadsheet and keep it updated . It’s not easy to keep it all in your head.

[Sara]

Do not close your CSP because that’s the card that allows you to spend points on a variety of travel expenses

[Robin]

Definitely sign up for one of the suggested travel groups and take the course.

Theres a method to the madness

[Jennie]

Highly recommend travel on points group. They’re super friendly and helpful.

General rule is to never close before holding the card for 1 year, otherwise you ruin your relationship with the bank.

Annual fee isn’t always bad, when the benefits outweigh the fee, it’s worth paying for it.

Have fun!

[Author]

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