Trying to Spend Enough for a Credit Card Signup Bonus? What to Do and What to Avoid

Credit card signup bonuses are the fastest way to earn a large amount of cash back or travel rewards. Meet a spending minimum within a specific time frame, and your card issuer automatically applies the bonus to your account.

As great as these bonuses are, it's frustrating when you're coming up on the deadline and haven't hit the spending minimum, because you could lose a bonus worth hundreds of dollars. While you should always look to choose a card with a spending minimum that you can reach through your normal expenses, you may find that the cards with the best signup bonuses are right on the cusp of what you spend.

There are plenty of ways you can pump up your spending in a jam, but they're not all safe or financially sound. Before you manufacture any extra spending, you should know which methods work well and which have problematic drawbacks.

Call your card issuer to try extending the deadline

The simplest solution is often the best. Card issuers do what they can to keep their cardholders happy, and yours may work with you if you need extra time to reach a spending minimum. Call the number on the back of your card or send a message through your account to ask about getting the deadline extended. With any luck, they'll give you the extra time you need.

Consider paying your rent or mortgage with a payment service

Housing is most people's largest monthly expense, and being able to put your rent or mortgage payment on your credit card makes it much easier to secure a signup bonus.

While your payment service options vary depending on your landlord or mortgage lender, Plastiq is one service provider that will work in most circumstances, as you can use it to pay just about any person or business. After you enter the recipient information and submit your payment using your credit card, Plastiq cuts the recipient a check.

The only downside is the credit card transaction fee associated with these services. That fee is usually 2.5%, so you may not want to pay this way every month, but it works in a pinch.

Avoid spending frivolously on things you don't need

People already tend to spend more when using a credit card than when they pay in cash. If you have a spending minimum to meet, it's even more tempting to buy things you don't need with the justification of "I need to spend the money anyway."

Don't start spending recklessly to reach the minimum for a signup bonus. It's far too easy to get into bad habits and end up with credit card debt.

Look for bills you can pay in advance

Paying your bills monthly isn't always the only option. With certain types of bills, such as insurance policies, you can pre-pay for multiple months of service at once. Your insurance carrier may even give you a discount for paying this way.

Before you do this, make sure you'll have enough cash to cover your credit card bill in full. It's not worth paying in advance if you'll need to carry a balance and pay interest.

Consider buying gift cards at stores you frequent

Like paying bills in advance, this method allows you to spend more now to cover future expenses. For example, if you're $150 short of a spending minimum, you could buy a $150 gift card at your supermarket of choice, and then use the gift card on future grocery shopping. Again, you should only do this if you have the cash to pay off the entire credit card bill when it's due.

The reason this method doesn't get the full stamp of approval is because not every card issuer counts gift card purchases toward spending minimums. American Express is one that doesn't, and it explains this in its terms and conditions. Check your cardholder agreement to see if it mentions whether gift card purchases qualify, or call your card issuer to ask.

Avoid buying prepaid debit cards

Prepaid debit cards are a popular way to boost credit card spending, both to meet spending minimums and to earn more points every month. They're also a giant red flag for card issuers, and they may not even count toward your spending minimum. For example, American Express treats prepaid debit card purchases the same as gift card purchases.

The danger with buying prepaid debit cards on credit is that it can look suspicious to your card issuer. That isn't to say you should worry about buying a prepaid debit card as a gift. Card issuers aren't looking to bring the hammer down on regular consumers. They look for the people who spend thousands on prepaid debit cards every month, or who get a credit card and immediately start buying prepaid cards.

Since there's no guarantee prepaid debit card purchases will qualify toward a signup bonus, and because of the risks involved, this method isn't worth attempting. There have even been Chase cardholders who saw all their accounts shut down for excessive prepaid debit card purchases.

If you pick the right methods, creating extra spending for a signup bonus is no sweat. Just make sure you choose responsible options that won't require you to carry a balance or put you at any risk with your card issuer.

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Lyle Daly has no position in any of the stocks mentioned. The Motley Fool recommends American Express. The Motley Fool has a disclosure policy.