Center your credit card application around big bills and big bonuses

Nothing in life appeals to me more than a huge welcome bonus on a rewards credit card.

There are so many great bonuses vying for my attention right now, and despite maintaining a healthy credit score, it would be unwise for me to apply for them all.

I write about credit cards, points, and miles every day, always focusing on the best deals available, especially when new products hit the market. I’m even more tempted to apply when these cards only add welcome offers for a limited time.

However, one thing that gives me pause is making sure I can meet the minimum spend to earn these welcome bonuses; otherwise, I might miss out but still have to pay the annual fee.

That’s why I developed a strategy to structure my credit card applications around life’s inevitable big annual bills to ensure I hit the spending necessary to enjoy those rewards.

Here’s how this strategy worked for me, some pitfalls to be aware of and the higher welcome bonuses I’m eyeing now.

Related: 5 Things to Check Before Applying for Your Next Credit Card

The upside to my inevitable big annual bill

If you’re only focusing on daily expenses, hitting the minimum spending requirement (especially in the $6,000 to $10,000 range) can be daunting, considering that you probably won’t use your card every day.

However, a single large bill can destroy most (or all) targets instantly.

I am a homeowner in Australia and I know that every February I receive a renewal invoice for my buildings and contents insurance with a due date of March. While I’ve never liked the idea of ​​spending thousands of dollars on this every year, I do know that it has to be paid, and it can satisfy a large portion of the minimum spending requirement for a credit card welcome bonus.

I also received my annual property tax assessment in April. I have the option of spreading the payment evenly over the year via monthly direct debit, but I prefer to pay the entire amount in one lump sum via credit card.

I’ve also noticed that my daily spending changes slightly with the seasons. I usually spend more time in the summer as I maximize my time outdoors, socialize with friends, and go on summer vacations. Spending typically contracts in October and November before increasing again in December as the holiday season brings gift buying, parties and holiday home decorations. So while the February-April period is the most reliable for big, predictable spends, I know there are certain other times of the year where it’s easier to meet the welcome offer’s minimum spend than others.

I always want to make sure I’m able to pay my bills on time (and take into account that there may be delays in approval for my new credit card, especially if I’ve been approved for multiple credit cards recently and opened a high credit limit), so I like to apply for a new card a few weeks before I know I’ll be getting those big bills.

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Predictable expenses you can plan for and pitfalls you need to avoid

Your predictable annual bills may vary depending on your personal situation and where you live, but here are some bills you may face that may be helpful in developing your welcome bonus strategy, especially if you are a U.S. homeowner:

• property tax: Many counties bill twice a year (for example, Los Angeles County in November and February), while New York City bills quarterly or semiannually. Card payments typically add a convenience fee of about 2%-3% (for example, New York City adds 2%; Los Angeles County adds about 2.22%).
• income tax: To qualify for the welcome bonus, you may consider paying through an IRS-authorized processor (fees apply): Pay1040 charges 1.75% for consumer credit, 2.89% for business credit, and ACI Payments charges 1.85% for consumer credit. Form 1040 card payments are limited to two per year, depending on the payment type. PayUSAtax no longer accepts IRS payments.
• vehicle registration: Deadlines vary by state (for example, Florida registrations renew on the owner’s birthday; Texas registrations renew on the same month each year). Online card payments typically add around 2% (for example, the California Department of Motor Vehicles adds 1.95%; the Wisconsin Department of Transportation adds 2.35%).
• insurance: Auto policies are usually 6 or 12 months; homeowners/tenants usually annually. Many carriers accept credit cards; some add a small convenience fee. Check your insurance company’s billing page.
• Homeowners Association/Condominium Dues: Community portals (e.g. ClickPay, AppFolio) often allow card payments with up to 3% fees; paying via Automated Clearing House (ACH) is often cheaper.
• Tuition and fees: The Bursar site using TouchNet/Nelnet usually accepts credit cards with fees of approximately 2.85%-2.95%; billing coincides with the start of the semester (August/September and January).
• Year-End Charitable Giving: Donations made before December 31st will be included in the tax year, but you must keep receipts/bank records.

Related: Should you pay your rent with Bilt? We crunch the numbers

Once you know when your big spend will hit, you should know some important conditions for these welcome offers as well as the pitfalls of this strategy:

• Don’t pay too much: Some billing processors charge credit card fees of up to 3%. These fees may only be worth paying if you can’t meet the minimum spend to earn your welcome bonus, as the total you pay may exceed the rewards you receive.
• Annual credit card fees are not included in the welcome bonus.
• Watch how to pay Encoded as: Avoid anything that might be considered a cash advance, such as money transfers, prepaid top-ups or person-to-person payments. These typically do not count towards minimum payouts and can immediately trigger fees and interest.
• Pay attention to the clock: The payout window usually begins on your approval/account opening date, not when the card arrives in the mail. It’s a good idea to set some calendar reminders a week before your minimum spending window expires so you can check how you’re tracking. Also, consider any delays the card issuer may experience in approving your application.
• Remember the magic spending amount: I once missed out on a welcome bonus on the Delta Air Lines American Express card because I thought the required spend was $2,000 when it was actually $3,000, and the card wouldn’t budge once the spending window expired. Don’t make the same mistake I made.

I now want to earn a higher welcome bonus

Here are the credit cards and welcome bonuses I’m eyeing right now, in order of priority:

• Atmos™ Rewards Summit Visa Infinite® Credit Card: Earn 100,000 Atmos Rewards points and a 25,000 Global Companion Award when you spend $6,000 or more within 90 days of account opening.
• Citi Strata Elite℠ Card (See Rates & Fees): Earn 100,000 Thank You Rewards points for a limited time when you spend $6,000 in purchases within the first three months of account opening.
• American Express Platinum Card®: Know your offer and see if you’re eligible to earn up to 175,000 Membership Rewards points after spending $8,000 in your first six months as a cardmember. Welcome offers vary and you may not qualify for one.
• Chase Sapphire Reserve® (See Rates & Fees): Earn 125,000 Ultimate Rewards points when you spend $6,000 in purchases within the first three months of account opening.

new Atmos Rewards Summit Card Even though I have never flown Alaska Airlines (and I probably never will), it is still at the top of my bucket list. The offer includes 100,000 of the most valuable airline points you can earn, as well as a flexible 25,000-point Global Companion Reward, which can be redeemed on all of Alaska’s airline partners, including British Airways and American Airlines. Even for someone like me who doesn’t fly Alaska Airlines, this perk is ideal.

Earn 3 points per dollar on all foreign purchases, which is very generous, so I’d like to get this card sooner rather than later, probably in the next month or so. I can then pool holiday expenses like gifts and year-end celebrations to meet minimum expenses.

I’ve been on the fence Citi Strata Elite Card That’s until Citi Appreciation Rewards adds American Airlines AAdvantage as its newest transfer partner. I hold Citi Strata Premier® Card (see rates and fees), this is one of the most valuable and underrated credit cards I’ve ever owned, as you earn 3 points per $1 spent in many categories. When the Strata Elite launched, there were some interesting yields, but nothing was a real slam dunk considering the high annual fee.

However, when American Airlines AAdvantage joined Citibank’s list of transfer partners, my entire rewards strategy changed and the card became even more desirable. When the recent welcome offer increased from 80,000 Thank You Rewards points to 100,000, I made up my mind.

I need to plan my minimum spend wisely on both cards, though, and plan to add the Strata Elite to my wallet before the end of the year (I’m crossing my fingers that the higher welcome offer sticks around until then). That means when the first annual homeowners bills start rolling in, I’ll still be within the first three months.

bottom line

There are so many great welcome offers out there for premium rewards credit cards right now, and sometimes I want to take advantage of them all at once.

After years of earning and burning points and miles, I’ve learned to be patient and spread my applications strategically throughout the year. The welcome offers change regularly and are barely noticeable, although of course if I had waited a few months I would have missed out on the top offers on these cards mentioned above.

Sometimes, when I’m not sure I’ll be able to meet the welcome bonus (because a particularly good offer is about to end), I’m forced to choose between applying for a card and potentially not getting a higher welcome bonus when a big bill comes due.

However, I find that when I have a big expense, there’s usually a good card that I want with a higher offer, and that works for me. I usually avoid paying large bills with a credit card fee of more than 1%.

Knowing that I have big bills rolling in every year (especially from February through April), as well as seasonal holiday expenses, I feel confident that it will be easy to meet the spending minimum multiple times a year.

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