Open a Credit Card & Get $500?
If you found $500 on the street, what do you imagine you’d do with it (after attempting to locate its rightful owner, of course)? Perhaps you’d finally pay off some lingering debt. Maybe you’d put it toward a family vacation this summer. Heck, you could even treat yourself to quite the spa day! The good thing about this little scenario is that, if you have excellent credit, it’s not really a hypothetical one. Banks are currently offering initial rewards bonuses worth up to $500 in return for people opening certain credit cards and spending a particular amount within the first few months.
You just have to know which card to apply for, but don’t worry, you won’t have to search through thousands of credit card offers and strain your eyes squinting at all of the fine print. We did the legwork for you and came up with a list of the credit cards with the best initial bonuses. All you have to do is consider whether you want: 1) Cash; 2) Free Flights; or 3) Complimentary Hotel Nights.
Best Cash Initial Bonus
The Card: Chase Sapphire Preferred
The Offer: 40,000 bonus points, which is redeemable for a $400 statement credit, after you spend $3,000 during the initial three months
The Catch: While this card does not charge an annual membership fee during the first year, if you keep it beyond that time, it’ll cost you $95 per year.
Best Airline Initial Bonus
The Card: British Airways Credit Card
The Offer: 50,000 bonus miles after your first use of the card (worth 1-2 free roundtrip flights, depending on whether your destination is international or domestic) and the opportunity to earn an additional 50,000 bonus miles by spending $20,000 during the first year.
The Catch: This card has a $95 annual fee.
Hotel Initial Bonus
The Card: Hilton HHonors Surpass Credit Card
The Offer: 60,000 bonus points (40,000 after your first purchase and 20,000 points after you spend $3,000), which are redeemable for 1-8 free nights, depending on how upscale of a hotel you choose from the 3,750 that are part of the Hilton Honors program.
The Catch: This card charges a $75 annual membership fee, which means you don’t want to keep it open longer than you need to. If you’re planning on using it to score free rooms at an international Hilton location, keep in mind that it also charges a 2.7% foreign fee for purchases that you make while abroad, so make sure to use an international credit card with no foreign fees.
How to Maximize Your Credit Card’s Value
Now, it’s important to note that the aforementioned cards don’t have the best ongoing rewards. However, you shouldn’t worry about that since getting a couple of different credit cards to meet your biggest needs is the best way to maximize value anyway. That’s also the central message of the Island Approach to credit card use.
If you don’t always pay your bills in full, applying the Island Approach might entail using a 0% balance transfer credit card to lower the cost of existing debt, one of the aforementioned initial bonus cards to garner a one-off benefit, and one of the best cash back rewards cards with which to subsidize everyday spending.
The bottom line is the right collection of credit cards used strategically offers a ton of value!
This article comes from our friends at Card Hub, a leading website that helps consumers find the best credit cards for their needs.