The Dos and Don’ts of Credit Card Sign-Up Bonuses

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The best time to get a new rewards credit card is when the getting is good—that is, when you can amass a hefty bonus just for signing up for the card in the first place. And boy are the stakes high right now—there are several cards with bonus offers of up to 100,000 points. That's usually the equivalent of several hundred dollars in cash back or travel rewards, depending on the rewards program.

Of course, bonus offers do come with a string attached: Generally, you need to spend a certain amount of money on the card within the first few months of opening the account.


The last thing you want to do is forfeit a bonus opportunity because you couldn't meet the spending requirement, so you'll want to implement a smart strategy before applying for a new card. (In many cases, if you don't meet the requirement, you won't have another opportunity to earn it again, even if you close the account and try again.)

Remember: The benefit of any credit card rewards and bonuses will most likely be wiped out by interest charges if you don't pay off the balance in full each month, so only apply for a rewards card if you're certain you won't carry a balance. Also, carrying too much credit card debt will also negatively impact your credit scores.

Find top rewards credit cards to apply for on Experian's credit card marketplace.

1. Time Your Application

Try to apply for a rewards credit card during the time of year when you know you might have big expenses coming up.

For some people, this could mean right before the holidays. For others, it could mean vacation time or before you undergo a home renovation. Take a look at your calendar and see when you might be purchasing a big-ticket item or will accrue a lot of expenses.

You should also make sure you are actually eligible for the spending bonus before you apply. If you've opened a previous account with an issuer, they may have restrictions on earning bonuses on a different card, so be sure to check.

2. Know Your Spending Deadline

Confirm the deadline by which you need to complete the minimum spend with your credit card issuer.

In many cases, the time period begins as soon as you are approved for the card. Don't assume it starts when you activate the account or when you receive the card in the mail. Get the exact date from the issuer, and set calendar alerts each month reminding you how much time you have left.

3. Put Everything On Your Card

This might seem like a no-brainer, but the fastest way to earn a sign-up bonus is to shift all your spending to this one credit card. That means if you have bills that are automatically deducted from your checking account, shift them to the card for a couple of months. If you tend to pay in cash for a lot of items, temporarily make the switch to putting them on plastic.

The exception? If you're charged extra for using a credit card instead of a debit card or check. For example, some utility companies may add a 2% to 3% surcharge or so-called convenience fee on credit card purchases. So before you switch to credit, make sure it won't cost you extra for the privilege. You'll also want to make sure you pay the charges off each month and only spend what you can afford in order to not incur additional debt.

4. Buy Gift Cards

If you shop regularly at certain stores, consider buying gift cards to use them down the line. For example, if you know you spend a certain amount of money each month at Target, use your new credit card to put six months worth of expenses on a Target gift card and use that to cover your Target purchases.

Again, you want to make sure you can afford to do this—you shouldn't be going into debt to get a sign-up bonus. But make sure that your credit card issuer counts gift card purchases toward the spending minimum because not all issuers do.

5. Pay Your Housing Bill

Most people's biggest expense each month is the rent or mortgage payment. Chances are, you pay this from your checking account. Find out if you can put the payment on a credit card. Some rental companies or mortgage servicers contract that ability out to third-party services like Plastiq.

Again, chances are you will have to pay a 2% to 3% service fee, but there may be a waiver for the first time. And sometimes, a small fee may be worth the number of points you accrue. In that case, you'll want to do the math.

For example, if your monthly rent is $1,000, and the service fee is 2%, you'll pay $20 for the privilege of putting it on your credit card. That $20 may be a small fraction of the rewards you'll earn by meeting a minimum spending requirement, so weigh the option.

6. Pay Bills in Advance

There may be certain bills that you can pre-pay in order to knock a chunk out of the spending requirement. That could include insurance policies or cable and cell phone bills. Just be sure to check if there's a limit on how much you can prepay and whether you incur any penalties for prepayment.

7. Request an Extension

If you do need more time, call your issuer to request an extension. They may be willing to give you an extra few weeks or month to meet the minimum spend. Just don't wait until the last minute to make the request—initiate it at the beginning of the purchase window.

8. Do Not Go into Debt

No credit card rewards bonus is worth going into credit card debt. Rewards cards typically have the highest interest rates of all cards, which means you could be paying an APR (annual percentage rate) of 29.99% or more on your purchases.

Credit card debt can spiral quickly, and even the richest rewards and bonuses can't make up for it. So make sure you spend only what you can afford to pay off at the end of a billing cycle—no exceptions.

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