3 Signs It's the Wrong Time to Chase a Credit Card Sign-Up Bonus

You may want to hold off if these circumstances apply.

Applying for a new credit card doesn't only mean getting access to an additional spending limit and snagging perks like rewards points or cash back on your purchases. It could also mean snagging a one-time bonus that puts a lot of money in your pocket.

Many credit cards offer sign-up bonuses for meeting a certain spending threshold. You might, for example, come across an offer for a $250 bonus if you spend $3,000 on a new credit card within three months of opening your account.

Chasing sign-up bonuses can be a good way to boost your cash reserves -- if you go about the process strategically. But here are three signs that the time isn't right to go after a sign-up bonus.

1. You already have a lot of debt

If you're in a place where you're carrying a lot of debt on your credit cards, then it's probably best that you not pursue a sign-up bonus or apply for any new cards until you get that debt under control. If you decide to chase a sign-up bonus, you might end up digging yourself further into a hole. 

Remember, too much credit card can not only be costly, but also, wreck your credit score. And having poor credit could make it very difficult to borrow money affordably if an emergency situation arises.

2. You don't have any major purchases coming up

There's a reason some credit cards have a higher spending requirement for snagging a sign-up bonus -- they don't want to give that cash away without having a good reason for it. But if you're not planning to make any large purchases in the coming weeks, then it may not be a good time to chase a sign-up bonus because you might struggle to meet the spending requirement tied to it.

Let's say you need to spend $3,000 within three months of opening an account to get your sign-up bonus, but you normally only charge $750 in expenses on a credit card each month. If you're planning to purchase a new laptop in the next few weeks, that might help you hit that $3,000 limit. But if you don't have a big purchase planned, you might end up spending money on needless junk to meet that requirement -- or falling short and giving up that bonus.

3. The offers out there aren't that enticing

Some credit card sign-up bonuses are more enticing than others. But if you're not thrilled with the offers you're seeing, then it pays to hold off on chasing a sign-up bonus and wait for a better one to arrive. 

There's a limit as to how many credit cards you should apply for in short order, and how many cards you can get approved for. If you chase a $100 sign-up bonus this month, you might miss out on the chance to go after a $250 bonus next month.

Credit card sign-up bonuses are appealing for a lot of reasons. But it's important to time those applications correctly to ensure that you can make the most of them.