Why Now's a Good Time to Chase a Credit Card Sign-Up Bonus

Credit card welcome bonuses are a tool companies use to lure in customers. But they can be a useful thing when meeting the bonus requirement at hand isn't difficult.

Commonly, with such a sign-up bonus, you'll get a lump sum of reward points or cash back for meeting a certain spending threshold within a few months of opening a new credit card account. You might, for example, be eligible for $250 cash back for spending $3,000 within three months of opening your card. If you normally charge $1,000 a month on your credit card for basic expenses, or if you have large purchases coming up, meeting that requirement may be fairly easy.

Now, you can make the argument that it pays to chase an attractive credit card sign-up bonus at any time of the year. But it might especially work to your advantage to go after one right now.

Time your credit card application strategically

A recent Forbes survey found that 49% of Americans plan to travel more in 2023 than in 2022. And this is especially true among people aged 18 to 26.

If you get a credit card with a welcome bonus now, you can use it to pay for your summer travel, whether it's airfare, lodging, food, or entertainment. And that might make it easier to meet whatever requirement there is to snag your free cash.

In fact, it's generally a good idea to chase a sign-up bonus when you have larger expenses looming. November, for example, can be another good time to apply for a new credit card with a welcome bonus because that's when people tend to start spending extra money on holiday purchases. If you're a parent, August can also be a good time to get one of these cards because that's when you may be loading up on back to school supplies.

Bonus cash could help offset your summer travel costs

If you apply for a new credit card with a sign-up bonus now, you may not get your bonus reward before your upcoming trips. But you might get that cash as some of the bills from your trips start rolling in, especially if you're doing your travel at the tail end of the summer. So either way, now could be a really good time to chase a sign-up bonus.

That said, one mistake you should always try to avoid when chasing a welcome bonus is forcing yourself to spend extra money just to snag that added cash. If you're looking at a $250 payday for spending $3,000 within three months of opening a card and you only manage to rack up $2,500 of expenses, making yourself spend $500 for no good reason won't really mean coming out ahead $250 -- it will mean losing $250 in the form of useless purchases.

That's why you really need to time your sign-up bonuses carefully. But given that travel costs have increased, if you get a credit card with a sign-up bonus now and take several trips this summer, you might have no problem meeting your spending requirement.