7 Effective Methods to Meet Minimum Spend of Credit Cards

Many travel reward credit cards with good sign-up bonus have minimum spending requirement, such as $3000, $5000, $7000 or $10000 in 3 months. The following are my 7 effective ways to meet minimum spend of credit cards to earn those credit card sign-up bonuses.

*** 1.  Regular/Required Spending

Fee-free:   How much do you normally spend per month on grocery, gas, utility, internet service, cable/TV, wireless, home insurance, auto insurance, donation that are payable using credit cards without you paying surcharge fee?  In some cases, maybe student loan, college tuition also fit.  I'd recommend to use a spreadsheet and list these items with expenses.

This total expense amount is your monthly base expenses you have to spend anyway and can be payable by credit cards.

If you have FSA and/or HSA, you can pay medical bills with your credit card first, then apply for reimbursement later.  Although FSA offers its own debit card, there is no additional financial benefit.  If your medical/dental/vision expenses do not qualify for the FSA expenses, FSA would still ask you to pay out of your pocket first, regardless using their debit card or not.

If you need to travel aboard, and the new credit card is a Chase card with no foreign transaction fee, it is a good opportunity to meet minimum spend.  Chase also offers competitive currency exchange rate.

Non-fee-free: there are also some spending which would incur a fee if paid by credit or debit card, for example, property tax, home owner association fee and even taxes in tax filing.  Although not recommended, it only makes sense when the credit card sign-up bonus is very attractive.

An online service provider Evolve Money offers its customer to pay bills (up to $2,999 per month) free using debit cards from large banks or a 3% fee using credit cards (Visa, MasterCard, Discover).  Evolve Money no longer processes debit card payment for free, but its offering to use credit card to pay monthly mortgage payment makes fulfilling $5000 minimum spend in 3 months an easy task.  There is a $150 service fee, which only makes sense if the credit card sign-up bonuses is worth much more.

*** 2.  Business Expenses
  • Does your company policy allows paying business expenses using your personal credit card first, and be reimbursed later?
  • Do you travel for business trip a lot?

If your answer is yes to both of the questions above, congratulation! Meeting minimum spend should not be a problem for you.

*** 3.  Expenses of Trustable Friends/Family and to be Re-imbursed

I'd identify these trustable people who would fit the "yes" answer to the following four questions,
  1. Are any of your good friends and/or relatives NOT interested in credit card travel rewards? So, there would be no mutual need to fulfill minimum spending.
  2. For those circle of friends matched for question #1, do any of them have a house insurance or auto insurance to pay?
  3. For those circle of friends matched for question #2, who are financially stable?
  4. For those circle of friends matched for question #3, who do you think you can pay for their large expenses first and be reimbursed via a check or peer-to-peer cash payment immediately?
I'd recommend compensate your trustable friends or relatives for the rebates they would have earned if using their own credit cards.

*** 4.  Pre-pay Required Expenses

Utility bills (water, garbage), TV/cable, internet, wireless phone services allow pre-pay using credit card, if these are the expenses you will have to pay in the next several months.  If you plan to re-locate, do not pre-pay these expenses.

PG&E, only $1.25 flat fee paid by credit card, Visa/MC only

*** 5.  Special Events

Is it the time again to ...
  • Give gift cards for birthday gifts, wedding gifts, anniversary gifts, house warming party?  
  • Dinner meet-up with friends and families? 
  • Colleague appreciation lunch or dinner?
  • Offer cash donations to charities you support?
  • shop for a furniture during July 4th or Thanksgiving holiday?  
  • Massage and facial service coupons from Groupon, Livingsocial, Travelzoo?  Purchase these coupons via Topcashback.com to earn additional cash back.

*** 6.  Buy Visa/MC/AMEX Debit Prepaid Cards and/or Fee-Free Gift Cards

The advantage of buying debit prepaid cards and gift cards is similar to extending the deadline of the minimum spending requirement.  You can use these prepaid cards later.  Debit prepaid and gift cards are always available in large grocery chain store such as Safeway.  Several credit cards offer 2x for grocery store purchases. American Express Premier Gold card is one of them.  The drawback is that you still have to pay for the cost of those gift cards when billing statement come, unless you can successfully apply "Manufactured Spending" techniques to Visa/MC debit gift cards.

Visa/MasterCard/AMEX debit prepaid cards have surcharge fee

Do not purchase Visa/MC/AMEX debit prepaid card from banks; the transaction will be coded as cash advance.

*** 7.  Manufactured Spending (do-able but not recommended)

Manufactured spending means non-real spending.  A simple example is to purchase a $500 Visa debit gift card with a surcharge fee of $5.95 at large grocery store, then to cash out the debit gift card completely.  The trade-off is $5.95 and the effort spent on conducting manufactured spending.  Be careful that cash withdrawal from credit card is considered as cash advance and does not count toward the minimum spend requirement.
  • Walmart ATM kiosks with Swipe Reloads Visa/MasterCard debit prepaid cards into your American Express BlueBird account.  American Express would also lock or shut down a BlueBird account when they detect suspicious activities.  BlueBird is not a transactional checking account.  You can withdraw money from BlueBird account into your linked bank account.   This option is not attractive to me.  (This is not a top option for me, as I live in the S.F. Bay Area.  There are a few Walmart Stores.  I visited four of these Walmart stores.  One does not have ATM express kiosk.  Two stores' kiosks are always not functioning.  The fourth one only works sometime.)

Add up the numbers to find out your monthly spending.   If you have monthly mortgage payment,  spending $5000 for 3 months via credit card should no longer be an issue.

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