Everyday when I check my Twitter feed, all I see are posts about new credit card offers with lucrative sign up bonuses. Not a day goes by that I find myself drawn to a new sign up bonus because of my wanderlust. As tempting as they all are, I’d like to address the question of “Should I sign up for every offer I see?”.
The answer… well, that depends… Are you trying to cover the cost of an upcoming trip or flight? Or are you just signing up to get the bonus points without a plan of how to use them?
If you have at least a general idea of how you want to use the points, go for it! Sometimes the offers are the best you will see in a long time. Just be sure that you are/were planning to spend enough to cover the requirement – typically this ranges from $1,000-$3,000 within 3 months after being approved.
On the flip side, if you sign up and were not planning on spending the minimum amount in the next few months, you may be costing yourself more money than you had planned to in your budget. (i.e. spend $3,000 just to get $1,000 worth of points but were only planning to spend a third of that in your budget for the next 3 months So in reality you are spending $1000 more than you need to: 1000+1000 = 2000.)
If you are merely signing up to get the bonus points where you *might* use them a couple years down the road, the timing may be wrong for you here as well. Miles and points are a terrible investment. You are most certainly going to lose money since rewards programs are constantly changing and devaluing your hard earned rewards. Spend them if you have them (but make sure it’s a good redemption for your points)!
This year alone I signed up for the Citi Hilton HHonors Visa Signature Card, Hilton HHonors Surpass Card from American Express card, and Hilton HHonors Card from American Express because 1) they were offering increased sign-up bonuses, 2) I wanted to use the bonus points to pay for my honeymoon and some other upcoming travel this fall where I want stay at a nice hotel and 3) I knew I would easily meet the minimum spending requirements to get the bonus points because I’m paying for a wedding.
To sum things up, I’m not saying that you shouldn’t try for the bonus, I am simply saying you should evaluate your current situation to determine the real reasons for why you are interested in the card. Once you have done the math, if everything makes sense, go for it!
