How to Maximize Credit Card Rewards on a Big Purchase

Earlier last year, we replaced our clothes washer and dryer. Both appliances were old, nearing the end of their useful lives, and, more importantly, we were renovating our pantry area after a burst pipe and flooding incident.

We were only a few years from replacing them and, using a small surplus of insurance money, we replaced them now so our other renovations would be sized correctly.

The purchase was around $1,500 for the pair and we got them from Costco.

In the store, Costco only takes Visa cards (their store branded card Citi card is one of the better ones too). Online, you can pay with any card you want (it’s one of my favorite Costco hacks).

This also means that I could use this big purchase to get a huge jump on a credit card welcome bonus. If you aren’t familiar with these, they’re incentives that credit cards offer to get you to start using their card. You often get a few hundred dollars in a bonus if you spend a certain amount within a short time frame, usually around 90 days. The higher the dollar amount of the bonus, the more they require you to spend.

They do this because they want to capture a “share of wallet,” meaning a percentage of your total spending. The bonuses often start with spending requirements of only $500 which can be a little or a lot depending on your budget. Our family of five in the Washington D.C. area would have no problem meeting the spending requirements of $500 in three months!

But if you know you’re going to have a big purchase coming up, it might make sense to get one of the higher dollar cards for the bonus because you know you’ll hit them.

Here are the cards I considered, at different dollar amount levels, for bonuses. I also included the annual fee, if there was one, and any 0% APR promotions in case financing is an issue.

If You’re Spending $500+

Chase Freedom Unlimited

If you have good to excellent credit, check out the Chase Freedom Unlimited if your major purchase is just $500. There’s a $200 after you spend $500 on purchases in your first three months.

This is a solid cash back card on its own. You earn 5% on travel purchases through Chase Ultimate Rewards, 3% at drug stores and dining, plus 1.5% cash back on all other purchases.

Card Details:

  • Sign-up bonus: $200 after you spend $500 on purchases in your first three months
  • Annual fee: $0
  • 0% APR promotions: Introductory APR for 15 months on purchases

Learn more about the Chase Freedom Unlimited

U.S. Bank Cash+ Visa Signature Card

The U.S. Bank Cash+ Visa Signature Card is a great cashback card on its own but they also give you $200 after you spend $500 in eligible purchases within the first 90 days of account opening

As a baseline, you get 2% cash back on one everyday category (like gas stations, grocery stores, or restaurants) and 1% cash back on all other eligible purchases. You also get 5% cash back on your first $2,000 in combined eligible purchases each quarter on two categories you activate.

Card Details:

  • Sign-up bonus: $200 after you spend $500 in eligible purchases within the first 90 days of account opening
  • Annual fee: $0
  • 0% APR promotions: 0% Intro APR on balance transfers for the first 12 billin cycles

If You’re Spending $1,000+

Wells Fargo Cash Wise Visa Card

The <strong”>Wells Fargo Cash Wise Visa Card is a great cashback card that will give you $150 cash after you spend $500 in the first three months of account opening plus unlimited 1.5% cash back credit card on all purchases . </strong”>

Card Details:

  • Sign-up bonus: $150 cash after you make $500 in purchases within three months of account opening
  • Annual fee: $0
  • 0% APR promotions: Intro APR for 15 months on purchases and balance transfers

(read the full scoop on the Wells Fargo Cash Wise card here)

Compare this card and others

Fidelity Rewards Visa Signature Card

Fidelity Rewards Visa Signature Card

The Fidelity® Rewards Visa Signature® Card can be linked to a Fidelity account where your rewards are deposited. This account can be a taxable brokerage account, an IRA, 529, or cash account.

This card is remarkable because not only do you get a nice sign-up bonus, $100 in cashback after $1,000 in purchases, but you get 2% cashback on all purchases with no restrictions.

Card Details:

  • Sign-up bonus: $100 cash after you make $1,000 in purchases within 90 days of account opening
  • Annual fee: $0
  • 0% APR promotions: None

Blue Cash Preferred® from American Express

Blue Cash Preferred® Card from American Express

The Blue Cash Preferred® Card from American Express has a $250 statement credit after you spend $1,000 in purchases in the first 3 months of Card Membership.

This card offers a few cashback tiers:

  • 6% cashback at US supermarkets on $6,000 per year in spending,
  • 3% cashback at US gas stations with no limit,
  • 3% cashback on US transit (ground transportation only),
  • 6% cashback on select US streaming (Spotify, Netflix, Hulu, HBO, ShowTime, Pandora, Apple Music, Amazon Music or Video but not Amazon Prime – see the American Express website for full detailed list),
  • 1% on everything else with no limit.

This card’s annual fee is $250 statement credit.

Card Details:

  • Welcome bonus: $250 statement credit after you spend $1,000 in purchases in the first 3 months of Card Membership
  • Annual fee: $250 statement credit annual fee, not waived for the first year
  • 0% APR promotions: Intro APR on purchases for 12 months from the date of account opening

Compare this card and others

If You’re Spending $3,000+

As you get to the higher spending tiers, you see more travel cards and fewer cashback cards. We only have one cashback card on the list below and then we share a few travel cards worth considering. The value of those points depends on how often you’ll use them so we try to find the programs with the greatest utility.

Capital One Savor Cash Rewards Credit Card

Capital One Savor CardCapital One Savor Cash Rewards Credit Card offers a $300 after you spend $3,000 on purchases in the first three months. This is on top of great rewards structure if you dine out often – you can earn 4% cashback on dining and entertainment, 2% cashback at grocery stores and 1% on all other purchases with no limit in each category.

Card Details:

  • Sign-up bonus: $300 after you spend $3,000 on purchases in the first three months
  • Annual fee: $300 annual fee, waived for the first year.
  • 0% APR promotions: No offers

Compare this card and others

Marriott Bonvoy Boundless Card

Marriott Bonvoy Boundless Card

The Marriott Bonvoy Boundless Card from Chase will give you 75,000 bonus points after you spend $3,000 on purchases in the first 3 months of opening your account.

You also earn 6X points at Marriott Bonvoy hotels, 2X points on all other purchases, plus you get a free night award each year, worth up to 35,000 points.

Card Details:

  • Sign-up bonus: 75,000 bonus points after you spend $3,000 on purchases in the first 3 months of opening your account
  • Annual fee: $95
  • 0% APR promotions: None

Learn more about the Marriott Bonvoy Boundless Card

One of these cards will help you earn a little bonus on the money you’re already spending!

What About Financing?

It almost never makes sense to take the financing offer any store offers. They’re abysmal.

Sometimes, they offer “deferred financing.” That’s when you get 0% for a period of time, like 12-18 months. When that period ends, all the interest that accrued during the promotional period gets added to the balance. If you pay off the loan before the promotional period, you pay 0%. If you don’t, all that interest comes due. (what happens is the paperwork explains this but you can bet your bottom dollar the salesperson won’t explain it that clearly!)

If you need financing over more than 12-18 months, consider working with your bank or credit union to get a short term loan. Most credit cards will give you a 0% APR offer on purchases and balance transfers for 12 months, even as many as 18 months, but after that, you’re looking at a double-digit interest rate. If you can pay it off within that time period, or very close to it, then the credit card offer may be the best offer. If you can’t, you have to do the math to see which is the best option.

Alternatively, if you have a choice, save up enough so that you can pay it off within the 12-18 month window. That way you can take advantage of these offers, pay it off in time, and not get charged a lot in finance charges. Those can easily eat up any bonus you might get.

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Jim Wang

About Jim Wang

Jim Wang is a thirty-something father of three who is a frequent contributor to Forbes and Vanguard's Blog. He has also been fortunate to have appeared in the New York Times, Baltimore Sun, Entrepreneur, and Marketplace Money.

Jim has a B.S. in Computer Science and Economics from Carnegie Mellon University, an M.S. in Information Technology - Software Engineering from Carnegie Mellon University, as well as a Masters in Business Administration from Johns Hopkins University. His approach to personal finance is that of an engineer, breaking down complex subjects into bite-sized easily understood concepts that you can use in your daily life.

One of his favorite tools (here's my treasure chest of tools,, everything I use) is Personal Capital, which enables him to manage his finances in just 15-minutes each month. They also offer financial planning, such as a Retirement Planning Tool that can tell you if you're on track to retire when you want. It's free.

He is also diversifying his investment portfolio by adding a little bit of real estate. But not rental homes, because he doesn't want a second job, it's diversified small investments in a few commercial properties and a farm in Illinois via AcreTrader.

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  1. Alison D. Gilbert says

    Great post about credit card sign-up bonuses. They have been a financial boon to me since I started using them. My favorite way to charge the necessary amount within the required time is charging my ‘utility’ bills on the new card. Since we live in an apartment, we don’t have the kind of large purchases you mention.

    But our cable bill, our cell phone bill and our home contents insurance all allow payment by credit card. Since they total around $300/month, I can easily meet either a $500 or $1,000 charge requirement within 90 days.

    Since I now have so many cash reward credit cards from using this money making (or expense reducing) technique, I want to focus on travel cards now to get some juicy points to take a vacation!

    Thanks as always for the great post

  2. Andrew says

    Nice article, and great examples. I’ve always thought this was a great topic, especially for anyone interested in home improvement. If you have a project coming up, a well-timed credit card could foot the bill and give you a discount in the process.

    I couldn’t agree more with your deferred interest warning. Aside from general store financing, some store-branded credit card offers come with deferred interest on their low-rate offers. This could come as a nasty surprise at the end of a project, especially since store cards are notorious for high rates. You definitely want to read the terms and conditions thoroughly!

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