How I take the stress out of hitting welcome bonus spending targets

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We’ve seen a number of great credit card welcome bonuses appear over the past few months, but a lot of the very best deals have included significant spending targets that cardholders have been expected to hit if they want to pick up all the bonus points or miles that are on offer.

For some, high welcome bonus spending targets are not an issue. For most of us, however, the quest to meet a high welcome bonus spending target can be challenging and stressful and can sometimes even lead to fiscally unwise behavior. Success in the miles and points world shouldn’t be stressful (this is supposed to be fun) and it certainly shouldn’t come at the expense of sensible financial behavior so in this post, I share how I avoid the stress that welcome bonuses can induce and how I make sure not to overspend as I try to rake in the bonuses I’m going for.

A bit of background

I don’t open and close credit card accounts on a frequent basis and I’m not someone who will hammer a great deal until it’s dead or until I’ve been excluded from further participation (that’s probably why I still have two functioning Bluebird cards that I control) but, just like most people reading this post, I still love to earn stacks of miles and points whenever I can.

With obstacles like Chase’s 5/24 rule and Amex’s “one welcome bonus per card per lifetime” rule, it has been important to plan which cards to apply for and when to apply for them for a few years, but it’s also now becoming equally important to put a little more thought into how a welcome bonus target is to be reached.

I don’t apply for enough credit cards to have to worry about Chase’s 5/24 rule, and I get targeted by Amex for cards where a bonus can be earned more than once per lifetime often enough that I don’t need to worry about its welcome exceptions either, but I do have to consider where the spending to hit the welcome bonus targets will come from before I start applying for the cards that I need.

Planning is key

If you happen to have a business with significant expenditure, spending significant sums of money in 3 months to earn a healthy welcome bonus (like this one) probably wouldn’t be particularly difficult, but that’s not the position most mainstream miles & points collectors usually find themselves in.

It can be tricky to hit a big milestone with everyday spending alone, so as it’s never a good idea to increase your spending just to earn a credit card’s welcome bonus, I always try to time my credit card applications to coincide with periods when I know my spending levels will be elevated anyway.

In practice, what this means is that we are now in what I like to call “my credit card application season” (it runs from October through November) and this is when I usually apply for most of the credit cards that I’d like to add to my portfolio.

Applying for new cards at this time of year means that I can use the spending from Thanksgiving, the Black Friday/Cyber Monday sales, Christmas, and New Year to help me hit whatever targets the credit card companies have set me without parting without any more money than I would have parted with anyway.

October, November, and December are by far and away the most expensive months for me so it makes sense to time my credit card applications with this time of year.

While October & November are my peak months for credit card applications, I try to make the most of any limited-time welcome bonuses that appear at other times of the year too, but I make sure that I have a solid idea of how I’m going to hit the welcome bonus spending target before I even contemplate an application.

I never apply for a credit card if I’m not clear in my own mind what upcoming spending I’ll be able to use to earn the welcome bonus without having to extend myself.

Because I travel quite a bit (when a pandemic isn’t ruining my plans!) and because I like to travel using some of the great Business Class fares that appear on a reasonably frequent basis, I can often rely on the spending needed for the trips that I’m planning to help me get a significant part of the way (or all of the way) to earning a credit card’s welcome bonus.

Other big-ticket items that I find myself needing to purchase often help me out too (e.g. the materials needed to help me remodel a couple of rooms helped me hit the last big spending target that I faced) and I always consider what big-ticket spending I have coming up before I fill out an application.

Sometimes, things can work in reverse.

I’ve had occasions where I haven’t been considering any new credit card applications but with a large bill suddenly landing in my lap, I start to give it some serious thought. I won’t apply for a new card just because I suddenly have a large bill to pay, but as soon as I realize that I’m going to be spending a significant sum of money anyway, I’ll reacquaint myself with the best credit card deals and consider whether any of the cards involved would genuinely improve my portfolio.

I work on the premise that if life is going to throw a big expense in my path I’m going to make sure that I get the most out of whatever I have to spend.

It’s important to note that the big-ticket items don’t have to be so large that they get me the welcome bonus(es) on their own – they just have to be big enough to give me a solid boost towards whatever my targets are. Big-ticket items combined with my regular everyday spending are usually what gets me across the line.

Bottom line

Nothing that I’ve written here should be taken as a hard and fast rule that people should be applying to their own circumstances. What works best for one person (me) won’t necessarily work well for someone else. Hopefully, however, some of what I do may give a few people some ideas.

Keep in mind that great credit card welcome bonuses aren’t going away any time soon so nobody should be rushing out and spending money that they may not otherwise be spending just to hit a welcome bonus target – that’s the very definition of idiocy.

What people *should* be doing is giving the timing of their credit card applications considerable thought and trying to coincide any applications that they make with times when life has thrown a few large expenses their way. Applying for a credit card and only then giving some thought to where the spending to meet the welcome bonus will come from is not a sensible tactic to employ.

Not only can you take a lot of stress and worry out of meeting a welcome bonus target with a simple bit of planning, but you can also avoid having to indulge in any practices that a credit card issuer may frown upon. With banks getting ever more interested in how we meet their spending targets, that’s never been more important than now.