How Sign-up Bonus Cards Work?

You need to spend a certain amount of money through your credit card within few months to avail sign-up bonuses. However, there are some cards that offer a sign-up bonus after your first purchase with no spending requirement.

You can redeem your sign up points for travel, merchandise, cash back, gift cards, or other rewards.

Moreover, cards with the best sign-up bonuses have higher credit score requirements than the cards without sign-up bonuses.

Best Credit Cards for Sign-up Bonus

  • Chase Sapphire Preferred Credit Card
  • The Starwood Preferred Guest Credit Card from American Express
  • Chase Freedom Unlimited Credit Card
  • Blue Cash Preferred Card from American Express
  • Venture from Capital One
  • Bank of America Travel Rewards Credit Card

Things you need to know to earn the signup bonus

Here are few things that you must know to earn the maximum signup bonus.

  • Your credit limit plays a role – Your credit limit affects how easy it is to earn the bonus. If your credit limit is below the spending threshold, the chances of availing the signup bonus reduces.
  • Purchases count, not other transactions – If you want to earn maximum sign up bonus, make sure to use your credit card for purchases. Your credit card spending amount depends on net purchases made instead of balance transfers or cash advances.
  • Annual fee – Cards that offer sign up bonus charge an annual fee. There are some credit cards that waive the annual fee in the first year, but others don’t.
  • Note the timing of the bonus – Most of the credit cards take 6-8 weeks to transfer signup bonus to your card. So keep in mind that it may take up to six months receive your bonus.
  • Always pay in full – Make sure to pay out your balance completely every month avoid any interest. Paying not on time or paying some amount can lead to incur interest charges. Paying interest on a rewards credit card negates the benefit of the rewards. So you can use your rewards card for everything, but just make sure to pay the balance full every month.
  • Read the rules – According to American Express’ rules, you cannot receive a signup bonus for the same card twice. And according to Citi terms, you can cancel your card and wait 18 months before reapplying and receiving a signup bonus for the same credit card.