Want to get a new credit card? Pay attention to those with a sign-up bonus to get tens of dollars as a gift. How does it work?
A credit card sign-up bonus is an opportunity to earn additional rewards (usually calculated in points) within the first 3 to 12 months of opening your account. Usually, the bank sets specific requirements that you must meet to earn this bonus. Typically, you will have to spend between $500 and $5,000, and you can earn up to a $400 welcome bonus. The good news is that not all 500 credit limit cards issuers have such requirements. Some of them allow you to receive a welcome bonus the first time you use the card or after your first purchase. How to choose a credit card with the best sign-up offer? Just read our article!
Credit Cards With Sign-Up Bonuses: Best Offers
Our team has analyzed more than 100 bank offers that are relevant in 2024. From them, we have chosen only the seven best options with the best credit card bonuses, convenient ways to use them, and good cashback. Some of them allow you to earn around $1,000 per year in rewards, so be sure to read all the descriptions and choose the one that will be most beneficial to you.
It is important to note that each credit card, even the best credit card to transfer balance with no transfer fee has requirements for those who want it, such as credit score, income level, etc. So make sure you meet these criteria before you apply to open an account with that bank.
The Blue Cash Preferred® Card from American Express
Blue Cash Preferred is one of the most rewarding credit cards in 2024. Not only does it offer multiple categories for cashback, but you can earn $250 back if you spend $3,000 within the first six months of opening your account. The terms and conditions that Blue Cash Preferred has are its main merit:
- The first year of your account is free, and you will need to pay a $95 annual fee for the second year.
- You can use Buy Now, Pay Later for $0 for the first 12 months.
- Intro APR for the first year is 0%, and for the following years, it’s 17.74% to 28.74% (variable).
- The balance transfer fee is $5 or 3%, and the foreign transaction fee is 2.7%.
In addition, Blue Cash Preferred has a very high cashback compared to its competitors. So, you can get 6% cash back for purchases at US supermarkets ($6,000 per year limit, then 1%) and on certain streaming subscriptions, 3% for gas stations and tolls, and 1% for purchases in all other categories.
The only downside to this option is the reasonably high APR after the first year of use and the need to have excellent or good credit if you want to be eligible. Blue Cash Preferred is one of the best deals on the market and allows you to earn about $1,500 in your first year of use if you make it your primary card.
Citi Premier® Card
If your credit score is 670-850 points, you can take advantage of this offer and get a sign-up bonus of 80,000 points. To qualify, you must actively use the card during the first three months and spend more than $4,000 cumulatively This proposal has the following positive aspects:
- You can earn three cashback points for every dollar you spend at restaurants, supermarkets, gas stations, or significant travel expenses (hotel or airfare).
- This card belongs to the World Elite Mastercard category, so with this card, you can enjoy all the benefits of the program.
- The 80,000 Points you earn as a welcome bonus equals $800, which is one of the highest rewards for credit cards.
- City Premier has no foreign transaction fees.
However, at the same time, this option is not the most profitable, as it does not have an intro APR or annual fee. If you use this card, you will need to pay between 19.74% and 27.74% APR from the first month, which is considered expensive, and a $95 annual fee. In addition, the card has a 5% balance transfer fee, which is also above average.
Discover it® Cash Back
The Discover it Cash Back has not the usual sign-up bonus, but several of them that are valid for an entire year. For example, this card provides 5% cash back on the first $1,500 purchases you make each quarter, but they must all be made at partner stores.
In addition, the cashback on all spending within the first 12 months of account opening will be doubled automatically. After those 12 months, you can spend it on gift vouchers or withdraw it to another account; the bank sets no limit on the final cashback amount! As for the rest of the merits of this offer, you should look out for the following:
- The Discover it Cash Back has 0% APR for the first 14 months.
- The categories and stores where you can earn rewards will change every three months, allowing you to make even more cashback.
- The card has a 3% balance transfer fee for the first 14 months, increasing to 5%.
- This option remains profitable even after the first year of use as it has a reasonably low regular APR on purchases of 12.24% – 23.24% (variable).
- It has no foreign transaction fees.
The main disadvantage of this option is that you will need to activate the cashback every three months before making purchases; otherwise, it will not count. This offer is excellent for those with good credit who are not eligible for the proposals described above.
Wells Fargo Autograph℠ Card
Wells Fargo Autograph is available for everyone with more than 690 FICO points. Like many other credit cards for people with this credit score, it has a 0: intro APR for the past 12 months and a $0 annual fee overall. With Wells Fargo Autograph, you can get a 30,000 bonus, which equals $300 if you spend $1,500 in purchases in the first three months – a great deal compared to the competition.
Plus, you can earn three cashback points for every dollar you spend at restaurants, gas stations, travel, or transportation and 1 point in all other categories. Wells Fargo Autograph has a 5% balance transfer fee for the first 120 days of usage and a 0% transfer fee overall.
The main disadvantage of this option is the high APR from the second year of use, 18.74%, 23.74%, or 28.74% variable. It’s an offer worth considering for those who want to take advantage of cashback and other rewards without paying an annual maintenance fee.
Chase Freedom Flex℠
This credit card has, in truth, the most generous sign-up bonus because it is 40% of the amount you need to spend to get it. So, for example, if you spend $500 within the first three months of opening your account, you get $200 in rewards. Another significant benefit of this option is the hefty cashback.
With this card, you’ll get 5% cash back on up to $1,500 combined purchases in every category you activate and 1% on all other expenses. Like one of the previous options, here you’ll be able to choose each quarter in which categories you want to earn the most cashback. Also, by taking advantage of this offer, you save on the annual fee because it doesn’t have one. Other conditions of Chase Freedom Flex are also pleasant.
For example, for the first 15 months of card use, you won’t have to pay any interest, and the balance transfer fee will be only 3%. However, after the trial period, the APR goes up to 18.74% – 27.49% (variable), and for balance transfers, you will need to pay 5% of the amount.
At the same time, foreign transaction fee equals 3% at any time, which is a disadvantage of this option. Chase Freedom Flex is the best option for those with a good to excellent credit score. Unfortunately, more generous bonuses at a $0 annual fee would be challenging to find.
Wells Fargo Active Cash® Card
Another card with a $0 annual fee will allow you to pay no APR for the first 15 months. It also has a generous sign-up bonus of $200 for the first $1,000 spent within the three months from account opening. This offer is available to anyone whose credit score exceeds 690 points.
Its main advantage is an unlimited 2% cashback on all categories, while the main drawback is a very high APR of up to 28.74% after 15 months of usage. Wells Fargo Active Cash allows you to get up to $600 of cell phone protection against damage and withdraw your cashback directly to your checking account.
However, it’s also important to note that you will need to pay 3% to 5% of the balance transfer fee and another 3% as a foreign transaction fee. Wells Fargo Active Cash is an excellent option for those who want unlimited cashback without tracking or activating categories every quarter.
Capital One Venture Rewards Credit Card
Do you travel a lot and want to earn bonuses from it? Then this best miles credit card no annual fee is perfect for you. You’ll earn 2 miles per dollar on every purchase, regardless of product or service category. Plus, once you sign up, you’ll earn 75,000 miles, which equates to $1,388 if you spend $4,000 within the first three months of opening your account.
The main drawback of this option is the high annual fee of $95, which you will have to pay from the first day you use the card. In addition, the problem with this offer is that you will only be able to spend miles on tickets purchased from Capital One partners airlines.
Unfortunately, we can conclude from feedback from card users that no significant airlines are on this list. You need a credit score of at least 670 points to get the card. With it, you can earn unlimited miles, use two visits per year to Capital One Lounges, and earn 5X miles on hotels and rental cars booked through Capital One Travel. This is the best option if you love to travel and use Capital One frequently.
What Is a Credit Card Sign-Up Bonus?
Competition between banks today is unusually high, so they try to attract new customers in every possible way. One of them is the so-called welcome or sign-up bonuses, i.e., a small number of points or miles credited to your account when you spend a certain amount of money with a credit card of that bank.
The most generous offers can reach 40% of the required cost, and some companies are willing to gift up to $5,000 to users who spend several times that amount in the first six months. Usually, these bonuses can be turned into gift certificates, but many banks already allow you to convert them into dollars and spend them like regular money.
However, it is essential to understand that no financial institution wants to lose its funds, so an attractive welcome bonus is not always a sufficient argument for using this offer.
How to Pick the Best Credit Card Sign-Up Bonus
If you want to get a sign-up bonus and choose the best offer for you, you will need to consider some factors. We have listed and explained them below to make it easier for you to make the right choice.
Bonus Value
Banks often try to deceive users by stating the bonus amount in points. Agree that it looks very tempting to offer “get 80,000 points” or “50,000 miles” even when the minimum amount to be credited is $5,000. If banks would directly write that they will give you only $800 to buy products at the specified stores, your desire to take advantage of their offer would be less.
And that’s good for you and your wallet. Before you open a new credit card because of tempting bonuses, find out what one point equals and exactly how much money you’ll get. Often you spend more on annual maintenance than you get as a welcome bonus.
Ease of Acquiring the Bonus
A standard requirement of all banks is to spend several thousand dollars over the first 3-6 months before you receive your award. This amount is often more than you are used to spending, so be careful that your new credit card does not develop an overspending habit. Also, ask the bank what form you can use these rewards in.
Unfortunately, financial institutions often cheat and only give out cashback as gift vouchers, which can only be used at partner stores if you purchase the required amount. As a result, you spend more than you planned and worsen your financial situation because of a seemingly lucrative offer.
Long-Term Value
It’s important to understand that you usually don’t use the card for just one year, and you pay various APR and fees, such as annual maintenance. Do you think it would be profitable for you to use this offer within 3-5 years? According to calculations by financial experts, for such a card to be profitable, its sign-up bonus should be three times the annual fee.
In addition, it is essential that you can get cashback in the categories in which you spend the most, and in no case in the shops or restaurants that are partners of the bank. In this case, the long-term value of this reward will be significant.
Is a Credit Card Bonus Taxable?
According to the IRS, you are not earning money but a rebate if you receive cashback, spending rewards, or sign-up bonuses. Of course, this rule only applies to individuals because if you receive cashback on business credit cards, you may be required to pay taxes on the funds you receive. However, if you are an ordinary person who has issued a credit card, you do not have to worry about taxes on your bonuses – you do not have to pay them.
Are Credit Card Sign-Up Bonus Offers Worth It?
To answer this question, we need to calculate how much you would have to spend on such a credit card and how much you could earn with it. Let’s take the standard conditions, the market average for users with good credit:
- Suppose our made-up credit card has a sign-up of $200 if you spend $1,000 in the first three months.
- Her annual fee is $95, and her APR is 20%.
- You get 1% cash back for every purchase.
If you spend $1,000 during the first three months of card use, you will earn 1% or $10 in cashback and $200 in savings. In this case, you will spend only $95, making at least $105 in the first year, even if you use the card for only three months, and spend at most $1,000 during that period.
It turns out that a sign-up bonus helps you earn a small amount of money. But remember that every credit card also has an APR, and these cards have a very high APR. So if you can, choose an option with the lowest APR possible because that way, you will save not a hundred dollars but several hundred or even thousands.
Pros And Cons Of Sign-Up Bonus of Credit Cards
Credit cards with a generous welcome bonus have many merits:
- You can recoup some of your spending with cashback, rewards programs, and best credit card sign-up bonuses.
- Many banks offer travel, car, and mobile phone insurance on top of all the rewards.
- Often these cards have a 0% APR for the first few months of use.
- You can also find options with no annual fee to enjoy all the rewards for free.
Such offers make sense if you choose them following your habits. Otherwise, they have a few significant drawbacks
- Because you are credited with cashback or rewards, you start to spend more.
- If the card has a high annual fee and APR, bonuses won’t help you earn.
- Often these offers are only available to people with good or excellent scores.
- Many banks calculate the cashback in points or miles to make you feel like you’re getting a great deal, but in reality, often, one point equals no more than a cent.
Be sure to consider how much money using such a credit card will bring you and how much you will spend to maintain it over several years. Only this way will you be able to choose a genuinely profitable option and get the maximum rewards.