Credit Card Shutdowns
I’ve experienced a few credit card shutdowns over the years, both recently and a good while back. A few I’ve definitely earned, and a smaller portion were surprises when I was playing (relatively) nice. For all the bank and credit card shutdowns which occur in our hobby, they’re not talked about often – somewhat understandably. And when people do, they’re not as specific as others would like. With that, allow me to preemptively apologize – I’m writing broadly today. I find value in sticking to these shutdown-related principles.
Decision Time
Individuals can do big things while politely, actively pushing the limits. Even in an age of growing application rules, many are consistently busy working on new credit card signup bonuses. Engaged players can easily pick up handfuls of new cards while following the rules. Some others augment signup bonus activity with additional plays involving more seasoned accounts. Beyond, a few partake of riskier methods which could lead to credit card shutdowns.
For that individuals in that last group, it’s very important to answer two questions before proceeding with a given behavior:
- Could this behavior contribute to a future shutdown?
- If so, what amount of this behavior’s benefit (in rewards) is worth the cost of a shutdown?
The answer to the first question is often an educated guess, but you may be able to obtain a bit more clarity. Compare notes with fellow trusted hobbyists, whether one-on-one or in a group setting. And I must underscore the importance of answering the second question. What’s the value of your relationship with a given bank? How much would you need to gain to make the shutdown “worth it?”
Be Prepared
Redemption
For those who choose to wade in more dangerous waters, set up and implement your escape plan. Most often, this entails actively and immediately redeeming rewards once they hit your account. In addition to the importance of routine redemption, rewards are should be optimally redeemed for something you can actually consume. Transferring a ton of points to miles in a given airline program may be fast, but they aren’t useful without a specific plan for them, and, worse, could be subject to expiration.
Rather, look at options for redeeming that bring solid, if not the highest cents per point, value. I’m perfectly comfortable redeeming for what others perceive as less value when I obtain a more immediate benefit for a given rewards form. That’s just another reason I don’t put much weight into cents per point value for travel rewards purposes.
Diversification
I often say that my favorite [insert pretty much anything here] is my biggest weakness. I undoubtedly love one bank point more than any other rewards currency, so what would I do if it went away?
To mitigate, I ensure to accrue rewards currencies across a variety of banks and credit unions, big and small. Flattening out that spend across all of those entities (as sensibly as I can) means that I’m less dependent on any one of them. Lowering that reliance takes away some of the sting from a potential shutdown. Let’s talk about that more next.
The Sky Isn’t Falling
The shutdown arrives. After the initial “that just happened” washes over you, take a step back to truly assess the situation. If you were intentional with your behaviors leading up to the shutdown and prepared accordingly, the effects of the shutdown are relatively minimal. Depending on the bank, you may lose the points or miles you were in the midst of accruing in the current statement period. But certain banks more actively post rewards throughout the period, not waiting for statement cut. If you’re immediately redeeming those, you feel the shutdown even less.
If you still have rewards in your account which was shut down, shame on you – but you may still have recourse. Officially or practically, some banks offer such customers a certain amount of time from the shutdown date to redeem.
Owning the Unknown
It’s natural to seek out answers for why a shutdown happened. Sometimes, but not always, we can point to a behavior (or group of them) which may have led to the shutdown. A popular mechanism that outsiders use is to immediately, incompletely assess the situation, entirely blaming it on a singular activity. That often comes with an individual stating they don’t take part in that activity, perhaps supporting preconceived notions and/or rationalizing their own behaviors. Hello, confirmation bias!
I can identify things that probably contributed to my shutdowns, but I won’t ever obtain the full reasons for them. Of course, the banks don’t share the specifics. In return for earning rewards in large amounts, I must accept the unknown. I’m okay with that deal.
No Doubt, Credit Card Shutdowns Stink
There’s only so much turd-polishing one can do with credit card shutdowns. Each shutdown I’ve received has affected me to some extent. Indeed, the related cards came with unique plays for earning and redeeming in outsized ways, some of the most fun I’ve had in the points and miles hobby. But with the above in mind, I’ve been able minimize the pain.
Credit Card Shutdowns – Conclusion
I imagine I’ll be shut down again in the future, probably deservedly so. It would be nice to have a brief respite, though. (I’m feeling good for now.) Big picture, as long as I’m still able to leverage rewards to meet my priority goals, I’m good. I can completely understand those who want to play a safer game, avoiding shutdowns at all costs. But others can roll with the punches, including shutdowns, to accomplish a bit more. There’s room for all of us in the hobby!
What shutdown matters do you keep in mind while aggressively playing the points and miles game?
Lower Spend - Chase Ink Business Preferred® 100K!
Chase Ink Business Preferred® is a powerful card that earns 3X Ultimate Rewards points in a broad range of business categories on the first $150K in spend per year. Right now earn 100K Chase Ultimate Rewards points after Learn more about this card and its features!
Opinions, reviews, analyses & recommendations are the author’s alone, and have not been reviewed, endorsed or approved by any of these entities.
Chase will shut you down and anyone connected to your cards. Sometimes they’ll even close P2 cards just for being in the same household as you. They’ll close both your personal accounts, business cards and all related checking/savings accounts. Chase has just as long a memory as Citi.
I have 2 Ink Cash zero interest for 12 months on purchases which I’m using for $ 14000. Would a shutdown make those due immediately?
Based on recent information from the underground, there appears to be a bank that rhymes with *hittybank that still refuses to issue any cards to a customer shut down by them 9 years ago for gaming their system. Might keep that in mind if you have cards with that particular bank.