Credit Cards with a Sign Up Bonus
A sign up bonus (also called an introductory offer) means you’ll receive a lump sum of bonus rewards points when you sign up to a new card and meet the card’s minimum spending criteria. Usually, you’ll need to spend a certain amount within a set timeframe to be eligible for the bonus points.
How do you earn the bonus points?
There are 3 different eligibility options you might encounter.
1. You may have to spend a certain amount each month over a specified number of months:
Example: Within the first three months from card approval, Ash must spend $1,000 on her card to receive 20,000 bonus points each month. If she spends $1,000 each month for three months, she will receive 60,000 bonus points in total. If she only spends $1,000 each month for two months, her bonus points total will be 40,000.
2. You may have an overall spend to reach within the entire introductory period.
Example: Greg must spend $5,000 on his card within the first three months from card approval to receive 80,000 bonus points.
3. You may have to meet a minimum spend within the timeframe and keep the card for over a year.
Example: Leo must spend $5,000 on his card within the first three months from card approval to receive 70,000 bonus points, and then have the card open for 15 months to earn a further 30,000 bonus points.
How long does it take for you to get the bonus points?
While each card varies, bonus points are usually awarded within 6 to 12 weeks of meeting the minimum spend (you’ll find this info in the credit card’s PDS). If you plan to use the bonus points to book travel, it’s a good idea to know when the points should arrive.
For example:
The Qantas Money Platinum card says points are credited within 2 months.
The Qantas Amex Ultimate and Amex Explorer credit card state it may take 8 to 10 weeks for points to arrive.
The ANZ Rewards Platinum card says points are delivered within 3 months.
The Westpac Altitude Black card also says you can expect points within 3 months.
For the most part, your bonus points will be credited to your rewards account directly (for example, Qantas points to your Qantas Frequent Flyer account, or ANZ points to your ANZ Rewards account). Again, check the small print for details on this. If you’re not yet a member of the rewards program your card is affiliated with, you’ll need to join when you apply for the credit card.
What can you redeem your bonus points for?
Once you receive your points, they’re yours to use as you like. You’ll get the most value points-for-dollar from flights, especially if you’re booking premium, business or first-class seats. For instance, Qantas Points are worth up to 2 cents each when used towards premium seats compared to 1 cent for economy. You can also redeem points to upgrade your ticket.
Many non-frequent flyer programs, like ANZ Rewards or Westpac’s Altitude Rewards, also let you transfer points to several airline loyalty programs. For instance, Amex Membership Rewards can be transferred to Qantas Points at a 1:1 rate, while ANZ Rewards can be redeemed for Velocity Points at a rate of 2:1. Many rewards programs have multiple airline partners to choose from.
Tips for maximising the value of your points
- Flights and flight upgrades offer the best overall value for rewards points.
Example: Qantas Points can be worth up to 2 cents per point for flights. - Low-value redemptions are gift cards, merchandise and cashback (which might include paying off past purchases).
Example: Qantas Points may only be worth up to 0.8 cents per point for these redemptions. - Look for ways to combine points through family sharing or partner programs.
Example: Qantas allows Family Pooling where you can give your points to a family member. - Look for bonus point redemptions, flight sales for points holders and booking during off-peak seasons.
Example: Qantas often offers discounts on rewards seats, such as 25% off Classic Flight Rewards.
Tips for meeting the sign up bonus criteria (without paying interest)
The last thing you want to do is reduce the value of your bonus points by paying interest. If you create debt that you can’t clear simply to get bonus points, those points will soon lose their value as you pay out more and more interest on your carried-over balance.
Instead, only use your card for purchases you know you can afford to pay back at the end of the month. Choosing an offer that allows you to do this while still providing you a good chunk of bonus points is the key to making this type of offer work for you.
⚠️ Cash advances don’t count towards the minimum spend criteria. That includes withdrawals from your credit card and any balance transfers, as well as fees, interest and gambling transactions.
The Ultimate Sign Up Bonus Guide
We’ve laid out some of the basics, now let’s get into the weeds: How to find the best sign up bonus offer and make it work for you. We’ll break it into 4 steps.
1. Choose a relevant rewards program.
It’s not just about choosing the biggest bonus points offer you can get. Instead, first think about the rewards program you want to align with. Can you use those points the way you want: for travel with certain airlines or with specific retail partners? What’s the monetary value of the points when redeemed for items you would want to buy?
You will usually find you get more value from your points when you redeem them against travel, such as flights and upgrades, rather than on other options such as gift cards and merchandise.
Helpful links
Do your homework before deciding what to spend your points on, and work out how you can get the most out of your bonus points and any other points you earn day-to-day.
2. Check the eligibility criteria.
In recent years, credit card providers have added more conditions to the eligibility for sign up bonus points. You’ll often find terms such as:
You must be a new cardholder for that particular credit card.
This means: You can’t already have the card open and must sign up as a new cardholder.
Real example: Westpac’s Altitude Black credit card stipulates that you must be approved for a new credit card, but doesn’t say you can’t have held other Westpac credit cards before.
You must be a new cardholder.
This means: You’re not eligible if you’ve already held a rewards or frequent flyer credit card (whatever the PDS states) with that provider. Some providers stipulate that you can’t have held the card within the previous 12, 18 or 24 months.
Real example: The ANZ Rewards card bonus points aren’t applicable if you’ve held an ANZ Frequent Flyer or ANZ Rewards credit card within the last 24 months.
You can’t have earned rewards points from the provider within the last 12, 18 or 24 months.
This means: You can have held a credit card with that provider before, but can’t have earned points via their credit or charge cards within the stated timeframe.
Real example: The Qantas Money Platinum card only allows you to earn the second-year bonus points if you have not earned Qantas Points via a credit or charge card in the 24 months before being approved.
3. Make sure you can meet the spending criteria
Think about whether the minimum spend criteria matches your normal spending habits. You don’t want to overuse your card in order to earn points, and you should be aiming to pay off your card each month in full to avoid interest. That way, you get the most value out of the bonus points.
Tips for meeting the card’s spending criteria: If you have a large purchase coming up, try to plan that purchase within the card’s introductory period. Or, you could simply work on channelling more spending through your credit card day-to-day, using your card where you may otherwise have used cash or debit.
4. Consider the annual fee and interest rates
Bigger bonus points offers typically come with a bigger annual fee. Consider whether you can afford the annual fee, and whether it’s worth paying for what you receive in bonus points, everyday points earning, and features. If you think you’ll be paying interest, it’s a good idea to calculate just how much you might pay each month and whether a low interest credit card might be a better fit.
You can expect to pay between 23.99% p.a. and 30% p.a. for a rewards card, which is very high if you’re going to be paying interest on what you spend each month (which hurts the value of your rewards points). A low-interest card may sit at around 13.99% p.a. or even less.
5. Check the other features of the card
Does the card come with other features you’ll use, like travel insurance, discounts or cashback programs, purchase protection or interest-free periods? It can be worth taking a step back and making sure you’re not paying an annual fee for features you won’t use.
That also means looking at the card’s earn rate, taking into consideration your estimated spend and what that equates to in points value. Also think about factors such as whether there is a points cap placed on your earn, or expiry dates on your points.
Examples of expiry dates on rewards points
Qantas Frequent Flyer points expire after 18 months if you don’t use your account.
Amex Membership Rewards, Commbank Awards and Altitude Points don’t expire as long as your account is open.
ANZ likes to make it confusing by saying your points expire 36 months after December 31 of the year you earned them.
Reading The Small Print
Rewards cards typically come with a lot more small print than other, more basic cards. And when you add features and introductory offers into the mix, there is even more small print to deal with. Take time to check the small print for details surrounding eligibility for the card and the offer, looking closely at how the offer works.
Which banks offer a sign up bonus on credit cards?
You can find cards with sign up bonuses from banks big and small. However, you will usually find bigger banks offer bigger bonuses, simply because they have a more extensive selection of cards, and tend to have more money behind them.
Within the range of sign up bonus credit cards on offer, you’ll generally find higher end cards offer more bonus points. That’s because higher end cards have higher annual fees, so card providers know they need bigger points bonuses to entice you to sign up.
Where can you find the best sign up bonus offers?
On CreditCard.com.au, we do our best to provide a wide selection of credit cards to allow for simple, side-by-side comparison. If you’re looking for sign up bonus offers, check out this page to compare your options using our comparison tool, and use the guide to find the best offer for you.
Keith Burton
13 September 2021Roland
13 September 2021