Trip Astute has partnered with CardRatings for our coverage of credit card products. Trip Astute and CardRatings may receive a commission from card issuers. Responses are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser's responsibility to ensure all posts and/or questions are answered. Opinions, reviews, analyses & recommendations are the author’s alone, and have not been reviewed, endorsed or approved by any of these entities.
You’ve probably discovered how lucrative credit card points are to earning free travel and other rewards. However, when applying for these cards, there’s often a requirement to spend a certain amount in order to get the welcome offer/bonus. This is called the minimum spend requirement, and there is no shortage of tactics to overcome this hurdle. In this video/post, we share how to meet minimum spend requirements in some creative ways.
Ways to meet minimum spend requirements
1. Monthly utility bills:
This includes your electricity, gas, cable and internet bills. If you’re not using your credit cards to pay for these charges, you may want to shift some of your spending onto credit cards. Also, if you have a bill that is reoccurring and generally the same amount, you can often prepay on the account to create a credit balance. That way, you’re just front-loading future monthly payments now in order to meet the short-term minimum spend requirement.
2. Auto insurance:
Paying the balance of your auto insurance bill can be a great way to generate a large purchase. For example, my auto insurance bill is for a six-month term. I’ll often pay the entire balance upon renewal on a card that has a minimum spend requirement. Some insurance companies will even give you incentives if you pay up-front rather than paying monthly. Since we’re based in LA, our auto insurance is fairly high, so it’s nice putting the large charge to good use.
3. Rent or mortgage:
Since most landlords and banks will not accept credit cards as payments, you can use services like Plastiq. Keep in mind that these services will charge a processing fee, typically around 2-3%. It’s not the best way to meet the minimum spend. However, I’ve used this method in the past and justified paying the fee knowing that I would be earning a bonus valued at over $1000.
4. Student loans or tuition:
If your school or lender doesn’t allow for credit card payments, you can use the same method that we described earlier with Plastiq.
You can often pay your income, business, or property taxes with a credit card. Though keep in mind that there is usually around a 2% fee to pay with a card. Like Plastiq and Tio, make sure you calculate the cost to use your card and the benefit that you expect to receive from the bonus.
6. Down payment on a car:
If you’re in the market for a car, you can often pay your down payment with a credit card. This is an excellent way to meet your minimum spend in just one purchase. Just verify with the dealership that the card is processed as a purchase and not a cash advance. Cash advances will not qualify toward your minimum spend and will generate a lot of additional fees. Be sure to ask before handing over your card.
7. Reimbursable business expenses:
If you work for a company that allows you to use your personal card then seek reimbursement, then I suggest volunteering to pay for the next happy hour or event. If you can float the charge until you get reimbursed, this can be a great way to meet your spend requirement.
Donating to charity is a great way to meet your minimum spend and potentially earn a tax deduction.
One of the most creative methods that I have used to meet the minimum spend is by making a microfinance loan via Kiva. Kiva allows you to directly loan money to an entrepreneur in a developing country. You can sort by country and business type, and research the stories before committing to the loan. Once you pick your borrower, you donate via PayPal fee-free and can expect to be paid back in full without interest. Keep in mind that there is a risk of the loan default, so I wouldn’t suggest this method if your cash flow is tight. However, I’ve made a loan in the past and was repaid within a year. It was a great way to make a difference in the world (while also earning points as well).
A word on “manufactured spending” …
I DO NOT recommend engaging in manufactured spending. You not only put your relationship with a lender at risk but also your personal finances! Some of these methods can even get you flagged for money laundering by the government. While they may have worked in the past, they are not worth the risk.
As always, I recommend that you only spend within your means and make sure that your finances are in order before getting too deep into this hobby. If you need help on getting organized, please check out our “Before Starting the Points Hobby” video/post for more details.
Do you have any tips or tricks for meeting the minimum spend requirements on your new credit cards? If so, please share them in the comment section below.
If you’re interested in applying for any of the cards in this post, we encourage you to compare credit offers. We do get a commission if you use our link. It doesn’t cost you anything extra, but it helps us to continue building content for our site and channel.