A big part of my low-cost travel strategy is signing up for travel credit cards that offer generous sign up bonuses. These credit cards allow me to get free or very low-cost flights, and allows me to travel much more frequently. Usually the terms of the offer will require a “Minimum Spending Requirement” in order to receive the bonus.
What is a Minimum Spending Requirement?
Often abbreviated to MSR or just MS, a minimum spending requirement is the amount of charges you must put on your credit card, within a certain period of time, in order to earn the sign-up bonus. It’s important to note that it doesn’t matter what the charge is for, and you never have to pay interest or carry a balance in order to receive the welcome bonus. You must simply meet minimum spend within a certain period of time (usually 3 months).
For example, a very common example of a credit card bonus would look like:
Chase United MileagePlus Explorer – sign up and spend $3,000 within the first 3 months to receive 50,000 United Miles (enough for 2 round-trip domestic flights; nearly enough for a round-trip to Europe).
Now, Chase doesn’t care what you buy, or if you carry a balance or not. All you need to do is put $3,000+ worth of charges onto the card within the designated time frame (which is almost always 3 months/90 days). The time requirement generally starts on the day you are APPROVED, not on the day you actually receive the card.
Most credit cards with lucrative sign up bonuses require anywhere from $1,000 to $4,000 in spend within 3 months. The majority of cards are in the $3,000-$4,000 range.
While spending $3,000 in 3 months to reach the minimum spend might seem daunting, it’s easier than you might think. In this guide, we’ll explore how to meet minimum spending requirements easily. Here are some ideas:
1. Everyday Expenses
Obviously if you’re working on a MSR for a credit card, everything you buy should go on your new card. That means groceries, restaurants, gifts, gas, etc. These days, you can generally use credit cards for the vast majority of purchases. Some landlords may even allow you to pay your rent via a credit card, but this is rare and usually incurs a fee.
Expected spend: $500+ per month/$1,500 over a 3-month period (obviously varies depending on your spending habits).
2. Bills & Prepaying Bills
You should be able to pay your bills with a credit card. Think about your power bill, phone bill, internet bill, insurance bill, etc. In addition, most providers will allow you to overpay your bill, which essentially prepays it for a few months in advance. For example, you could prepay your phone bill ($50) for 6 months ($300) to help meet minimum spend requirements. Obviously your ability to do this depends on your cash flow and the amount of savings you have.
Expected spend: $200/month, $600 over a 3-month period. Significantly higher if you wish to prepay (up to $1,000+)
3. Reimbursable Expenses
If you have a partner/spouse/roommate/parent/etc that you split expenses with, ask to put the expenses on your credit card, and have them pay you back in cash or check. You may even come across situations where a friend is about to make a purchase for themselves, which you can offer to pay for in exchange for cash. Obviously, only do this with people you trust, as ultimately you’re on the hook if they don’t pay you.
Expected spend: $200/month, $600 over a 3-month period.
4. Gift cards
If you find yourself struggling to meet the minimum spend requirement for a credit card, a very easy way to rack up additional spend is to simply buy gift cards to places you regularly shop at. Think practical first – a $200 gift card to your favorite grocery store, $50 to your favorite restaurant, $100 to your local gas station. You should also buy them somewhere that you earn bonus rewards, such as fuel points. For example, Fred Meyer (Kroger-owned) sells a wide variety of gift cards, and they offer 2x-4x fuel points per $1 spent. That means if you buy a $200 gift card during a 4x points promo, you’ll get up to $0.80 off per gallon next time you fill up. Safeway and several other grocery stores offer similar programs.
Expected spend: $200 to $500+ (I use this is a backup plan, if I don’t think I’ll meet credit card MSR naturally).
5. Visa Gift Cards
You may also consider buying Visa, MasterCard, or American Express gift cards. These cards essentially function as debit cards, but are prepaid. They have purchase fees of $3-$6, but can be loaded with up to $500. You can then use these cards for everyday spend in the future, wherever Visa/MC/AMEX are accepted.
Note that not all stores will accept credit cards when buying Visa gift cards. In addition, some credit card providers (AMEX in particular) are starting to look closer at transactions involving Visa gift cards, and could potentially deny your bonus if you buy visa gift cards to meet minimum spend. That’s quite unlikely to happen, but it’s good to keep in mind.
This is a beginner-friendly list, so I won’t get too deep into manufactured spending (MS), but many folks also like to buy visa gift cards with credit cards, and then buy money orders with the gift cards. This allows them cycle funds through their credit cards and deposit them back into their bank accounts. This is an easy way to meet MSR and rack up points, but unfortunately the whole thing is EXTREMELY variable depending on where you live, what stores you have access to, what credit cards you have, etc.
Expected Spend: as much as you’re willing to prepay. This is also a good back up method.
6. Rent/Mortgage (maybe)
Some landlords (generally large property management companies/large apartment complexes) allow payment with credit cards, usually for a fee (2-3%). Some mortgage providers may offer the same, although this is rare. If this is available to you, it might be worth the fee while you’re working on a MSR, but typically will not be worthwhile for everyday spend.
Alternatively, you may be able to use a third-party provider like RadPad or Plastiq to pay your rent/mortgage. These companies accept credit card payments (for a fee), and cut a physical check to mail to your landlord. Kind of a hassle in my opinion, but many people love using these companies.
Expected spend: $800+ per month, $2,400+ over a 3-month period – IF it works for you (often will cost you some in fees).
7. Paying Taxes (maybe)
You can actually pay your taxes online using a credit card. The fee is 1.87%, which isn’t bad at all considering most credit cards earn 1-2%+ back in the form of rewards or cashback. You can pay via a third party provider like Pay1040.
Of course, this will work better for some folks, and won’t work at all for others. It’s great for self employed people, who withhold their own taxes and make quarterly payments. Otherwise, it only really works well if you end up owing a balance at the end of the year, or if you mess with your withholding to lower it (which I don’t recommend).
Expected spend: varies
8. Sending Money to Friends (reimbursable)
Last but not least, you may be able to send money to friends (and have them pay you back via check/cash), using your credit card. Providers like Venmo, PayPal, etc. allow this, although they all charge fees of around 3%.
Expected spend: as much as necessary
So, there you have it! Hopefully these techniques will help you meet minimum spend requirements quickly to help you rack up more miles. Let me know if you have any questions! Or – if you have a brilliant trick to meet minimum spend quickly, I’m all ears!