“Gotta spend money to make money” is an annoying axiom in the entrepreneurship world, but it is definitely true. It’s hard to make meaningful profits without investing in the tools and resources you need for your business, and sometimes that means sucking it up when faced with a seemingly pointless cost of business too.

Churning and MS are the same way, though I think a lot of us struggle with that fact mentally. Any hobby that is close enough to FIRE attracts mindsets that seek to avoids unnecessary spending.

But sometimes (a lot of times) you do need to spend money to make money in churning and MS. What that looks like changes as you progress through the MS food chain and become comfortable with paying for things that don’t feel essential, but are very much a cost of doing business. I put together a few examples at different levels of MS lifecycle to help illustrate.

By the way, this is not financial advice, I am not a financial advisor, I am definitely not your financial advisor, etc. etc. But hopefully looking at some of these examples helps you weigh benefits vs. cost when making churning decisions that affect your bottom line.

Shrimp examples

• Paying a big annual fee for a card: Early on, paying a fee that is rapidly approaching four figures is hard to wrap your head around, regardless of mirrored finishes. While it’s simple math to come out ahead with the sign up bonus, let’s not pretend that $600-$900 isn’t a lot of money to pay to wait 2 hours to get into a crowded lounge.
• Paying for a private group: Paying someone for access to a private group feels weird, especially when some of the best sources of new angles are publicly available, (但如果你不懂中文，就很难真正理解。). The true value isn’t the information shared, it’s the networking and friends.

Fish examples

• Paying MS fees: Between percentage fees to load on couch MS and flat fees on street MS, you’re likely to be spending money (and potentially a lot of money, based on scale) to build up your points reserve before you liquidate. This comes back to the psychology of floating, to a degree
• Paying for churning/MS tools: Much like private groups in the shrimp example, it can feel strange to pay someone a decent chunk of change for access to a tool with a niche application. There’s a lot of tools out there, but they can be worth paying for if they help you increase efficiency, find award space, etc.

Dolphin examples

• Paying to keep cards open post-SUB: Early on, it’s drilled into new churners that they should close every card possible when the annual fee posts, because there’s no SUB to be earned this time around. There’s a lot of nuance towards making that decision as you grow, and the answer isn’t the same for everyone. But there are plenty of examples where the benefit added by having access to that particular credit easily outweighs the annual fee, even if there aren’t blatantly obvious reasons to keep it. 
• Eating an amount of money to avoid issues: This one will occur more and more as you graduate to higher levels of MS spend. Over time, you’ll become less and less likely to invite the scrutiny that comes with things like disputing Facebook Ads fraud or everybody’s favorite CU adding your money to the wrong account. Ultimately, it’s better to take the (hopefully small) L and keep things uncomplicated – especially if said amount is $75.

Whale examples

• Purposely being a bad gambler: I’ve talked about the parallels between gambling and MS in the past, and here’s yet another one. Whether we’re talking about the major sportsbooks or the myriad of less prominent ways to gamble, no casino or book wants to keep consistent winners around. As degen as it may feel to do, purposely doing what amounts to lighting money on fire can actually keep you alive (and profitable) longer.
• “Paying interest” on your credit card: I saved the best for last since this example is so antithetical to beginning churning advice. Hell, beginning financial advice – Dave Ramsey just fell to his knees in a Walmart. But occasionally, interesting opportunities present themselves when you’re a little late on getting around to paying the bill.

Pictured: this blog post, circa 2017 meme format

All this to say that there will always be a cost of doing business associated with playing the game, and that cost will become both increasingly against conventional wisdom, and increasing in scale. But a big part of progression is learning where to accept that cost as a means to reap future profits. 

乾杯！