How to Meet Your Credit Card’s Minimum Spend Requirement
Are you thinking of signing up for a new credit card so you can use those sweet “sign-up” bonus points or miles to help pay for your next vacation? Every credit card out there with a signup offer of bonus miles or points comes with a requirement to spend a minimum amount of money within the first x months of opening your account. This amount can range from $1000 to $4000. A lot of times I get asked the same question from my friends “I can sign up for a new card, but how am I supposed to meet the minimum spend requirement without going over my budget?”
Well, there are definitely some ways to meet that minimum spend with just your daily expenses.
Here are six clever hacks we have used to meet the minimum spend requirement.
1. Pay your rent with your credit card
For most of us, the biggest recurring expense we have is our cost of accommodation a.k.a RENT. Why not use your credit card to pay for your rent and meet that minimum spend? A lot of property management and leasing companies now allow you to use your credit card to pay your rent for a service fee (usually around 3%).
If your landlord doesn’t accept credit card payments, then you can use services like Radpad or Plastiq to have a check sent directly to your landlord. These companies also charge a 2.5% service fee for using your credit card.
I’m sure by now you are asking “Is that 3% fee on top of your rent really worth it?”. Well yes, it is! Let’s do some math here.
Let’s say that your shiny new credit card offers a signup bonus of 50,000 miles, with a minimum spending requirement of $3000 in the first 3 months, and your rent is $1000/month. Every time you use your credit card to pay rent, you would pay a $30 (3% of $1000) fee. Add that for 3 months, and you would have spent a total of $90 in service fees to meet the minimum spend. But on the other hand, you will have also earned 50,000 bonus miles which are worth between $500 – $625 depending on your card. $625 minus the $90 in service fees, and you are still $535 richer than before. You have to pay your rent either way, so why not rack up some bonus miles in the process.
2. Pay for all of your expenses using your credit card
We follow this one rule religiously when we sign up for a new credit card. We put away all our other credit and debit cards and only use the new credit card until we have met the minimum spend requirement. That means all expenses such as gas, groceries, restaurants, the pack of gum from the gas station, the venti soy skinny vanilla latte with 2 shots of espresso, the internet bill, trip to the barbershop…you get the point (no pun intended). All of that gets paid with the new credit card. You’ll be surprised at how quickly all those expenses add up to meet your minimum spend requirement.
3. Get credit card right before a big purchase
If you know you have a big expense coming up like down payment on a car loan, booking a vacation, or shopping for the holiday presents, then you might want to consider signing up for a new credit card before you make that purchase. This way you will be able to meet your minimum spend requirement a lot faster.
FYI it takes credit card companies 2-3 weeks to mail your new credit card, so plan accordingly.
4. Pick up the tab when out with friends
Planning a night out with your friends or family? Offer to pick up the tab for the dinner, drinks, show tickets, etc. with your new credit card. Then, request them to pay you back using Venmo, Cash, or other cash transfer services. This is another great way to get closer to your minimum spend amount with spending any extra money. Plus, you’ll save the waitress or bartender a huge headache!
5. Prepay for services
A lot of subscription services give you the option to make annual payments instead of monthly payments. The semi-annual or annual payments usually come with a discount for paying in advance. If you can pay for these services in advance, it’s a great way to meet the minimum spend requirement.
6. Use Plastiq to may payments
If you have other bills that you are not able to pay using your credit card, then consider using Plastiq. You can pay your taxes, car payments, tuition, mortgage, and other services using your credit card for a 2.5% service fee.
By using these hacks, we have been able to easily meet the minimum spend requirement and earn bonus miles. However, we do not suggest that you spend extra money beyond your regular expenses just to meet the minimum spend requirement. Our recommendation is to always pay your statement balance in full every month to avoid paying interest.