How to meet the minimum spend for credit card bonus points
Want to get bonus points with a new credit card? Here’s how to meet the minimum spend requirements for one of these offers.
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Getting bonus points with a new credit card is a fast way to boost your rewards or frequent flyer balance. Usually, you need to meet a set of requirements to get these points, such as spending a set amount in the first few months. There are plenty of different ways to meet this type of requirement, and here you'll find examples of some of the most common options.
This guide also goes through common terms and conditions for bonus point offers, as well as what to think about when you're deciding if a bonus point offer is worth it or not.
7 ways to meet bonus point minimum spend requirements
Depending on the bonus point offer, you may need to spend a certain amount each month, in the first few months or over another period of time. With that in mind, below are examples of some strategies people use to meet the minimum spend requirements.
Paying for everything with your credit card
From groceries to clothing, dining out and bills, using your credit card for all your daily expenses is often an easy way to meet bonus point spending requirements. Just make sure you check what payments are considered "eligible transactions" for meeting the minimum spend. Generally, most everyday transactions are fine but some bills may not count towards the spend requirement.
Planning a big trip in a few months time? Using your new credit card to pay for some or all of your travel expenses is a simple way to meet a bonus point spending requirement. There are also frequent flyer credit cards that offer 1 additional point per $1 spent for bookings with the associated airline. For example, the American Express range of Qantas Frequent Flyer credit cards offer 1 additional Qantas Point per $1 spent on Qantas passenger flights that are purchased directly from Qantas, as well as for Qantas Frequent Flyer and Qantas Club membership joining and annual fees.
Prepaying your health insurance or other major expenses
Paying your health insurance fees up-front for 12 months can go a long way towards meeting your bonus point minimum spend. As an example, if you were paying $300 per month on a combined hospital and extras plan, prepaying for 12 months would cost you $3,600. Depending on your bonus point offer, this could be enough to make up the entire minimum spend requirement. Plus, some health insurance providers offer discounts of up to 4% if you choose to pay annually.
Buying major household items
If you're planning on buying new furniture, white goods or want to do some more hands-on renovations, using your new credit card could be an easy way to meet the bonus point spending requirement.
Buying new technology
Need a new laptop, tablet or other tech items? It's possible you could meet your bonus point spend requirement very quickly by paying for them with your credit card.
Paying for seasonal expenses
If you get a new credit card in time for the holiday season, you could use it to pay for all the presents, food and drinks that you buy for holidays such as Christmas and New Year's Eve. As a bonus, it may even mean that you're ready for these holidays well before they arrive (so you can beat the shopping crowds).
Car services or repairs
If your car's due for a service or some repairs, it's possible that using your new credit card will help you meet your minimum spend requirement. Just make sure that the transaction is processed as a "purchase" so that you know it will count towards the spending requirement.
Other tips for meeting bonus point minimum spend requirements
If you're looking for ideas on how to meet minimum spend requirements, remember that it's important to only spend what you can afford to pay off. Avoiding interest charges should also be a priority. So before you pull out your plastic to meet the bonus point spend requirement, consider the following steps:
- Budget for repayments. Make sure you look at how much you'll have to pay off your card to avoid interest when you're meeting the minimum spend requirements. For example, if you have to spend $3,000 in 3 months, you would need to put $1,000 a month or around $250 per week towards your credit card balance.
- Set up auto-pay for your credit card. Set repayments up so that they automatically come out of your nominated bank account by the due date on each statement. If you're using your credit card more so you can meet the bonus point minimum spend, then opting to pay the full amount automatically will help keep your account debt-free.
- Transfer money as soon as you make a purchase. If you're using your credit card for purchases you'd normally make with a debit card, this pay-as-you-go method will help you keep your balance in check. Just use your credit card for purchases, then log in to your Internet banking account and transfer the same amount from your everyday bank account to your credit card to keep your balance clear.
What are eligible transactions?
The minimum spend requirement for bonus points only applies to eligible transactions you make with your card. While the definition of an "eligible transaction" varies, it typically covers most of your everyday spending. Transactions that usually don't count towards the bonus point spending requirement include:
- Cash advances. As well as ATM withdrawals or getting cash out at the register, cash advance transactions can include foreign currency purchases, transfers between accounts and gambling transactions. Be aware that these transactions also attract the cash advance interest rate and a cash advance transaction fee that will add to your account costs.
- Gift card purchases. Many credit card providers consider the purchase of gift cards and prepaid debit cards as cash advance transactions. So if you were thinking of buying gift cards as a way of meeting the bonus point minimum spend, make sure you check with the card provider or refer to the credit card reward program terms and conditions to find out if this is possible.
- Balance transfers. Balance transfers let you move existing debt onto a new card, which means they're technically not purchases and won't count towards your minimum spend requirement.
- BPAY Payments. Many credit card providers and reward programs exclude BPAY transactions from earning points, including CommBank Awards, Westpac Altitude Rewards and St.George Amplify Rewards. But even if BPAY transactions are not excluded, they may be processed as a cash advance (depending on how the biller has set up BPAY Payments), which means you still wouldn't get points.
- Bill payments. Most credit card providers exclude bill payments made over-the-counter at the bank or at Australia Post from earning rewards. Check the other payment options available for your bills and refer to our guide to see if they'll count towards the minimum spend for your credit card.
- Government charges. Most credit cards won't earn points for government charges, including those made to the Australian Taxation Office. There are some exceptions, such as the American Express Explorer or the American Express Essential credit cards. But even these may have specific requirements that limit your options for meeting the minimum spend amount by paying government bills.
- Refunds. If you meet the minimum spend requirement and then get a refund on your purchases, your points balance may be adjusted to reflect that. If the refund is processed before the end of the bonus points offer period, you may need to spend more before you're eligible for the extra points.
Is spending money on bonus point requirements worth it?
If you can stick to purchases you would normally make anyway, such as supermarket shopping and food delivery, you may be able to meet the spend requirement without blowing your budget. But in some cases, the amount of money you spend getting bonus points could outweigh the value of the rewards. You can look at the following details to help decide whether or not a bonus point offer is worth it:
- Potential interest charges. Look at the purchase interest rate and the minimum spend amount to estimate how much you could end up paying for each month you carry a balance from meeting this bonus point requirement. For example, if the spend is $3,000 in 3 months on a card with a 19.99% p.a. purchase rate, you would be charged around $49.80 per month on the balance.
- The annual fee. Reward and frequent flyer credit card annual fees can quickly outweigh the value of rewards, even if you're getting thousands of bonus points.
- The value of the bonus points. You can consider the value of the points based on what rewards you want to redeem. For example, you could redeem 60,000 bonus Qantas Points for a return business class flight between Sydney and Adelaide (55,200 points) or $300 worth of Woolworths digital gift cards (59,260 points for one $250 card and one $50 card). Finder analysis shows that with Qantas Points, flights usually offer more value. It's worth looking at a few reward options for any card offering bonus points. You can also use this guide to calculate the value of your points.
- Bonus point processing time. The time it takes for bonus points to be added to your reward or frequent flyer account can vary between cards and could be anywhere from a few days to several weeks after you have met all the offer requirements. If you want the points for a particular reward, this timeframe could help you decide of an offer is worthwhile for you.
- Balance transfers. If you're planning on using the card to pay off existing debt, remember that any repayments you make will go towards the debt with the highest interest rate first, such as the purchases you make to meet the minimum spend. This could mean you end up with more ongoing debt and interest charges in the long term.
Different types of bonus point requirements
Keep in mind that the requirements you need to meet to earn bonus points can vary a lot between cards. Below are some of the different options you could come across when you're comparing cards:
- A minimum spend in the first few months. Usually, you need to spend a set amount of money on eligible purchases to earn the bonus points. For example, you might have to spend $3,000 in the first 3 months from card approval.
- A minimum spend each month for the first few months. For example, a card could offer you 20,000 points per month for the first 3 months if you meet a monthly spend requirement of $2,000. This means you could technically earn up to 60,000 points for a total spend of $6,000 in the first 3 months, but only if you met the $2,000 spend requirement each month.
- Bonus points per $1 spent. With this type of bonus point offer, sometimes known as a “bonus point earn rate”, you'll earn additional points for every $1 spent on eligible purchases – on top of the standard earn rate. For instance, a card might offer “Up to 30,000 bonus points” and then explain that you can earn this amount by getting an extra 2 points per $1 spent in the first 6 months you have the card.
- Bonus points after your first purchase. Occasionally, there are offers that give you bonus points after your first purchase (regardless of the dollar value), but those offers are less common than ones with set spending amounts.
- Bonus points on your card anniversary. This offer rewards you with bonus points after you have the card for 12 months. Usually this type of offer is directly linked to the card’s approval anniversary and may require you to pay your annual fee. For instance, an offer might say “earn a bonus 20,000 points when you pay the card’s annual fee in the second year”. In this case, the annual fee is typically charged 12 months after you open the account, so you’d be able to get points as long as you don’t cancel the card before paying this charge.
Credit card bonus point offers can give you hundreds of dollars in extra value but only if you can meet all the promotion requirements. If the minimum spend is more than you normally spend on a card, it may not be worth it. So weigh up all the costs of each card to decide if it will suit your budget and your goals.
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