10. Sign-up Bonus Snafus and How to Avoid Them

Welcome to Point Me to First Class, the only show for employed professionals, entrepreneurs, and business owners who are looking to optimize their higher-than-average expenses to travel the world. I'm your host, Devon Gimbel, and I believe that your expenses are your greatest untapped asset if you know how to leverage them. Ready to dive into the world of credit card points and miles so you can travel more, travel better, and travel often? Let's get started.

Hello everybody. Today’s episode is an important topic because we are going to be talking about sign-up bonus snafus. Mainly the various ways in which you can accidentally not earn a sign-up bonus when you get approved for a new rewards credit card. Knowing how to avoid missing out on earning a sign-up bonus is so important because even if you utilize several different methods of earning points for your expenses, new card sign-up bonuses are still the easiest way to earn lots of points quickly. So you want to be absolutely sure that when you get approved for a new rewards credit card, you don’t make a mistake that’s going to cost you earning the sign-up bonus.

In this episode, we are going to look at what can go wrong that will prevent you from earning a sign-up bonus on a new rewards credit card, and, more importantly, how you can be sure to not fall into one of these traps so that you never miss out on earning those glorious sign-up bonus points.

Sign-up bonus snafu number one isn’t actually about missing out on earning a sign-up bonus entirely, but it is about missing out on the highest sign-up bonus offer available for a given credit card. You might think that for any specific credit card, there would just be one sign-up bonus offer available, and anyone getting approved for that card would be receiving the same number of bonus points when they qualify for the card.

But that’s actually not always the case. Some banks of credit card issuers will have multiple different sign-up bonus offers available for a single specific credit card at the same time. Which sign-up offer you get will depend on the specific credit card offer link that you submit your application through. Now, I don’t know why some credit card issuers do this, but they do. So I want to make sure that you know about it and what to do about it.

One example of a credit card issuer who sometimes has multiple different sign-up bonus offers available at the same time on one card is American Express. Right now, for example, if you look up on of Amex’s rewards card, the Personal Gold card, through the public American Express website, you'll see the welcome offer on that card is 60,000 American Express points when you spend $4,000 on the card the first three months you have the card.

This is not the highest sign-up bonus on this card right now. You can actually earn 90,000 American Express points for the same amount of spend, $4,000 in three months, if you apply for the card through the referral link of someone who already has an Amex Gold card if they have the specific offer that they can send you. That is 30,000 extra American Express points for the same exact card and the same exact amount of spend.

Here's why you need to be aware of this. Number one, American Express doesn’t tell you this on their public website. So if you just go to americanexpress.com and pull up the Amex Gold card, it will show you the publicly available offer for the 60,000 point sign-up bonus, but it doesn’t tell you anywhere on that page that a better offer actually exists, which honestly I think is a little bit crappy.

The second reason you need to be aware that multiple sign-up bonus offers can exist for the exact same card is because many credit card issuers, including American Express, have rules around how often you can earn a sign-up bonus on their cards, which means that you don’t want to miss your chance to earn the highest sign-up bonus possible when you're applying for a new credit card.

In fact, American Express has some of the more restrictive policies around earning signup bonuses for new cards, including limiting you to earning a sign-up bonus on a particular card only once per lifetime. That means that once you qualify for a specific card through them, like the Personal Gold card, and you earn the sign-up bonus on that card, you can't ever earn a sign-up bonus on that specific card again.

Now, there are some exceptions to this rule which we are not going to dive into the details of today. What you need to know is that especially when it comes to American Express, you want to be sure that the offer you're applying for when you get a new rewards card with them is the highest one that is publicly available at the time because it might be your only chance to earn a sign-up bonus on that particular card.

Another scenario where there might be multiple sign-up bonus offer amounts on a given credit card is where you can qualify for a higher sign-up bonus if you apply for a credit card in a physical bank branch. We see this sometimes with Chase credit cards. Like, right now, for example, at the time of recording this podcast episode, there is currently an elevated sign-up bonus offer for the Chase Sapphire Preferred card if you apply for that credit card in a Chase Bank branch.

If you apply for the Chase Sapphire Preferred card through the link on Chase’s website, the sign-up bonus offer is 80,000 Chase points after spending $4,000 on the card in three months. But if you can get to a physical Chase Bank branch and go there to apply for the same card, right now you can actually earn 90,000 points as a sign-up bonus when you spend $6,000 on the card in six months.

Not every single rewards credit card will have multiple different sign-up bonus offers available at a given time. In fact, the majority of rewards credit cards will just have one single sign-up offer that’s available regardless of whether you apply for the card through the issuers website, by using a referral link from a family member or a friend, or you go in person to a bank branch to apply for the card.

How do you know if the card you're thinking of applying for does have multiple different sign-up bonus offers available? How can you ensure that you apply for the card with the highest sign-up bonus possible? The resource that I love to use to quickly identify the highest publicly available sign-up bonus on any given rewards credit card before I apply to it is put together by the group over at frequentmiler.com. We’ll link their website up in the show notes so that you can find it really easily.

At the top of their website, they keep an updated list of best credit card offers where you can find the current highest publicly available sign-up bonus for any rewards credit card. Note that targeted sign-up bonus offers may have higher sign-up bonuses than the publicly available offers, but to apply for a credit card using a targeted offer you have to be, you may have guessed this, specifically targeted by a credit card issuer.

This means that you will receive either a mailer at your home address or your business address or an email inviting you to apply for a specific rewards credit card with a higher sign-up bonus than is publicly available. Targeted offers will come addressed directly to you and often will have an invitation code or a link specific to you that enables you to earn an elevated sign-up bonus when you use it to apply for a specific rewards credit card.

So in the absence of receiving a targeted offer for a credit card, your best bet at securing the highest sign-up bonus possible is to use the resource at frequentmiler.com to verify that a better offer does not exist before you apply for your next rewards credit card.

Okay. Moving on to sign-up bonus snafu number two. This is where you don’t earn the sign-up bonus points for a new credit card because you're actually ineligible to earn the bonus. What happens here is that you apply for and get approved for a new rewards credit card, but you don’t earn the sign on bonus even though you're putting spend on the card. This almost always happens because you're not even aware that you're ineligible to earn the sign-up bonus for a particular card, but as you can imagine, this is incredibly disappointing.

So let’s talk about why this happens and how you can make sure that it doesn’t happen to you. Most of the major credit card issuers, all of them, in fact, have rules around who can be approved for their credit card products as well as criteria for being able to earn the sign-up bonus on a new credit card.

For example, in the Citi ecosystem of credit cards, there are a couple of rewards credit cards that earn Citi’s transferrable points currency, which is called Citi Thank You Points. Citi has a rule where you have to wait 24 months from opening, closing, or upgrading or downgrading a Citi card that earns Thank You Points in order to earn a welcome bonus or a sign on bonus on another card in the same family that also earns Citi Thank You Points.

That means that if you earn the sign-up bonus on one of the Citi credit cards that earns Thank You Points like the Citi Premier credit card and then you apply for a different Citi credit card that also earns Thank You Points less than 24 months later, for example, like the Citi Rewards Plus card, you will not receive a sign-up bonus on the second card.

The good news is that avoiding this sign-up bonus snafu is relatively because credit card applications always include fine print that explicitly lays out the eligibility criteria for applying for that credit card and for earning a sign-up bonus that you can and should review before you formally submit an application for that credit card.

Now, American Express will conveniently show you a pop up screen alerting you if you are not eligible to earn the sign-up bonus for a credit card that you're interested in before you even have to submit your application, but they're the exception, not the rule. As long as you take a minute to review the eligibility criteria published for the rewards credit card that you're considering applying for before you submit your application, you should be able to avoid this unintentional mistake of applying for a credit card that you can't earn the sign-up bonus for.

The third main credit card sign-up bonus snafu is also the most common one, which is getting approved for a new rewards credit card and not earning the sign-up bonus even though you're eligible to. There are actually several scenarios that can all lead to this outcome, all of which are easily avoided once you know to look out for them.

All of these scenarios have one thing in common, which is that you won't earn the sign-up bonus for a new rewards credit card if you don’t meet the minimum spend requirement in the specified time period. Every rewards credit card will clearly display what the sign-up bonus is for that card, for example 60,000, and the minimum spend requirement needed to qualify for that sign-up bonus, for example, when you spend $4,000 on that particular card in the first three months.

As long as you put the required amount of spend on your credit card in the required timeframe, you earn the sign-up bonus. Sounds pretty straightforward, right? Right and wrong. Because every so often, I see posts from people online or I get messages from people saying, “I missed out on earning the sign-up bonus for a new credit card even though I thought I put enough spend on the card.”

So what's happening in these cases? As I mentioned, there are only two variables to earning a sign-up bonus on a new rewards credit card assuming that you are eligible to earn it. That is the amount of money you have to spend and the timeframe you have to spend it in. So if you don’t earn the sign-up bonus on a credit card, it’s because something went wrong with one or both of these variables. Let’s look at exactly what that could be.

When it comes to the timeframe that you have to spend the required amount on a new credit card in order to earn a sign-up bonus, this will clearly be displayed at the time you apply for the credit card and is a specified length of time. It can be three months, four months, or six months, but they’ll always tell you what it is.

Here is where you can get tripped up with this variable. The clock on this timeframe doesn’t start ticking when you receive the credit card in the mail or when you activate it. The clock to meet the minimum spend requirement on the card in order to earn the sign-up bonus starts ticking when you get approved for the credit card.

This matters because some credit card issuers, I'm looking at you Chase, can take up to two weeks for you to receive your physical card in the mail once you’ve been approved. So you don’t have four months from the time of receiving or activating your card to meet the minimum spend requirement at that point. You have three and a half months.

The best way to not miss out on earning your sign-up bonus this way is to know not only how long you have to put the minimum spend on your card but to take note of the day you're approved for the card and be sure to start counting down your timeframe to spend from there.

The other crucial aspect of the time frame in which you need to meet the minimum spend requirement to earn the sign-up bonus is that the charges need to post to your credit card in order to count toward the minimum spend requirement, not just be charged to the card during the designated timeframe to earn the sign-up bonus.

This can really trip you up and ruin your chances of earning your bonus points because charges don’t always post to your credit card statement the day you make your purchase. Some charges stay as pending on your statement for a few days before posting. What this means is that you never want to wait until the last day or the last few days of the timeframe to make your minimum spend. You want to ensure that the entire minimum spend required to earn your sign on bonus are charges that post to your account before the timeframe is up.

In a similar vein, be aware that sometimes charges for purchases you make online will not post to your account until the item that you purchased actually ships, even if that’s weeks or a month after you submitted your order. This is why if you're using online purchases to meet the minimum spend requirement on a new rewards credit card, it’s even more important to keep an eye on your credit card statement to verify when the charge shifts from pending to actually posted.

When it comes to the other variable in earning the sign on bonus, which is the minimum amount of money you need to spend, there are a couple of things that could cause you to miss out on your bonus points even if you thought you met the spend requirement.

The most straightforward reason you can miss out on earning the sign-up bonus is that you just don’t meet the spend requirement stated on the credit card application. This usually happens to people who don’t even realize they're applying for a rewards credit card, and that they can earn a bonus on the card. That’s really unlikely to be anyone listening to this podcast, but it is worth nothing that you are definitely not going to earn a sign-up bonus if you don’t put the required spend on the card.

What's much more likely to happen to you and what I want to help you avoid are these two scenarios where you put what you think is enough spend on your new rewards credit card but you still don’t earn the sign-up bonus. First of all, not all charges qualify towards earning a sign-up bonus.

If, for example, you have to spend $4,000 on your new rewards credit card in order to earn the sign-up bonus, that’s not $4,000 of just any charges. It has to be $4,000 of qualifying charges. You could be put $30,000 of charges on that new rewards credit card the first day you get it in the mail. But if they're not qualifying charges, your not going to earn your sign-up bonus. The good news is that every credit card application will list in the fine print of the application itself which charges qualify for earning the sign-up bonus and which charges don’t. So you will never have to guess.

In general, charges that do not qualify towards earning the sign-up bonus on a new credit card include things like cash advances, person to person payments, balance transfers, purchasing cash equivalents like money orders. Here's one that snags a lot of people, the annual fee the credit card issuer will charge you for holding that credit card does not count toward the minimum spend requirement to earn the sign on bonus, even if that annual fee is $695.

To avoid missing out on earning your sign-up bonus this way, just make sure to tally up the charges you're putting on your rewards card and don’t include any of the above categories as contributing to the minimum spend requirement.

All right. Here is the final scenario where earning your sign-up bonus can go sideways even when you think you’ve charged enough on your card to meet the minimum spend requirement. This is when you make enough qualifying purchases on your card in the designated timeframe to earn your sign-up bonus, but then after the window to qualify for the sign-up bonus ends you have to return one of the purchases that helped you meet the minimum spend requirement.

Here's what this could look like. You get a great new rewards credit card with a minimum spend requirement of $4,000 in three months in order to earn 80,000 bonus points. You make $4,000 of qualifying charges within three months, and you earn your sign-up bonus. Great. Then after the three months timeframe in which you can make qualifying purchases closes, you realize you need to return one of the purchases you made that was part of that $4,000 qualifying spend.

Maybe it’s something that you ordered online that when it arrived wasn’t the right fit, and you want to return it since you know you won't use it. Maybe it’s something that you ordered and the company just outright sent you the wrong item by mistake, but you have to return that before you can get sent the corrected item. Maybe you purchased something and want to exchange it for a similar item, but in order to do that, the original item is processed as a return on your credit card statement.

This scenario is particularly tragic because once you're out of that initial timeframe you have to meet the spend requirement to earn a sign-up bonus, you can actually lose the sign-up bonus if you have to return a purchase and if that returned amount makes you fall below the minimum spend requirement threshold in order to earn that sign-up bonus.

Once the window closes on qualifying for the sign-up bonus, there's not much recourse that you have. So the best way to avoid this scenario altogether is to either only purchase things you're absolutely certain that you won't be returning, or, and this is what I suggest instead, don’t just spend the absolute minimum to meet the spend requirement for the sign-up bonus.

I think it’s always safer to put more spend on the card during that initial timeframe where your spend counts towards earning a sign-up bonus than just the bare minimum amount needed to qualify for the sign-up bonus. How much extra spend beyond the spend requirement is a good idea? That’s really up to you, but I always put at least a few hundred dollars more of spend on a new credit card during the initial window to earn a sign-up bonus than the bare minimum. I think doing even more isn’t a bad idea.

All right, that is it folks. Those are the most common reasons why you could accidentally lose out on earning a sign-up bonus for a new rewards credit card. Here are a few more tips to ensure that you'll never be in danger of missing out on a sign-up bonus yourself.

Number one, before you apply for a new rewards credit card, make sure to review the fine print to confirm that you meet the eligibility requirements to earn the sign-up bonus, and you clearly understand which charges or purchases will and will not qualify toward the minimum spend requirement to earn the sign-up bonus.

Before you apply for a new rewards credit card, once you clearly understand the minimum spend requirement to earn the sign-up bonus, review your anticipated upcoming expenses to ensure that you have enough spend to meet the minimum spend requirement. Number three, screenshot the sign-up bonus offer at the time you apply for the credit card. This is just a great practice in general. It will ensure that you don’t forget what card you applied for, when you applied for it, or what the sign-up bonus offer parameters for that card are.

Number four, once you have your new rewards credit card, complete the minimum spend requirement at least two weeks before the qualifying time period end, and check your credit card statement before the timeframe to earn the sign-up bonus expires just to ensure that your charges have actually posted to your statement so that they will count towards the minimum spend requirement.

Number five, finally, spend more than just the minimum amount to meet the sign-up bonus requirement. This will give you some wiggle room in case you have to return a purchase after the window to qualify for your sign-up bonus ends and keep your bonus safe from potentially being clawed back. All right everybody. Go forth, earn those amazing sign-up bonuses, and be sure to join me again next week for our next episode.

Hey, did you know that earning sign-up bonused on new rewards credit cards is just one method of earning credit card points and miles? There are actually many ways to earn points, but not all points earning methods are right for everyone, especially if you have expenses.

That’s why I teach only the most high yield points earning approaches for people with high expenses inside my online course Points Made Easy. A recent course participant, Leah, said, “Before joining the course, I kind of had a working knowledge on points, or so I thought. Boy was I wrong. I was just playing small time.”

If you want to up your points earning game, you have to join me inside Points Made Easy. We’re opening for enrollment soon, but only for a week starting Friday May 19^th. To make sure you have first access to enroll when doors open, join the waitlist for the course at www.PointMetoFirstClass.com/PointsMadeEasy.

Thank you for joining me for this week's episode of Point Me to First Class. If you want more tips on turning your expenses into travel, visit pointmetofirstclass.com to learn more. See you next week.