Credit Cards

Do you want to make a large purchase with a credit card? do this first

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Credit card signup bonuses can offer a great way to earn rewards points quickly.

Key points

  • A credit card can be a great way to pay for a major purchase.
  • You may want to plan your purchase and use a new rewards card to earn a sign-up bonus.

When used responsibly, credit cards can be an easy way to pay for everyday expenses. If you want to make a big purchase soon, you might want to check if you can earn bonus points by opening and using a new rewards credit card.

There are many reasons why you may need to make a large purchase. Examples include home repairs, the purchase of a new appliance, or a large, unexpected bill. Using a credit card to cover a large expense could be advantageous. A large spend presents the perfect opportunity to open a new credit card and meet the minimum spend to earn a sign-up bonus.

But there are some considerations to make before doing this. If you can plan for a large purchase, you’ll be more prepared and able to get the right card for your needs.

What to do when you need to pay for a large expense

If there’s a big expense coming up, you should first check to see if you can pay for it with a credit card. If the company allows you to use a card, ask if they will charge you credit card processing fees. It may not make sense to use your card if you will be charged fees.

Next, you’ll want to find the right card for your goals. Don’t be tempted to choose a card with the highest sign-up bonus offer.

Consider how the card earns rewards, what the annual fee is, and what other benefits it has besides the sign-up bonus. You’ll also need to consider your credit standing because you want to apply for a card with a good chance of approval based on your credit score.

You’ll also want to check to see the minimum spend and how long you have to reach that spend requirement. Many card issuers require that the minimum spend be met within the first 90 days or three billing cycles.

Make sure you can meet the minimum without overspending on purchases you don’t need. If you need to spend $4,000 within the first three months, will your big purchase hit that, or will you need to buy other things as well? You should only charge what you can afford to pay right away.

Avoid credit card debt

Finally, consider how you will pay for your card. It’s best to pay off your credit card balance in full monthly to avoid interest charges. Otherwise, interest charges can add up quickly and high card balances can negatively affect your credit score.

The best option is to use the money in your savings account to pay for a large purchase with a credit card. If you don’t already have savings stashed away and can wait to make the purchase, spend a few months saving money first to avoid going into credit card debt.

Credit card bonus offers are a great way to earn points fast

A credit card sign-up bonus can be a great way to earn a lot of points at once and in a short period of time. If you meet the minimum spend for a new card and earn the bonus offer, you’ll be close to reaching your rewards goals.

How do credit card points work? You may be able to redeem them for a free hotel stay, a free flight, or a statement credit, which could make your next credit card bill more affordable.

If you’re looking for a new credit card, check out our list of the best rewards credit cards.

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