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5 ways to earn that credit card sign-up bonus

By , CardRatings Contributor

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If you've never had your own rewards credit card, chances are that you might be missing out. That's because, as Lauren Gensler recently pointed out in Forbes, some of the biggest banks around are trying to build their credit card customer base by reaching out to their own customers. To make the sale, writes Gensler, they're "revamping their cards and offering extra rewards." And, most banks aren't just going after their own customers -- they're going anyone who is credit-worthy and willing to sign on the dotted line. How are they reeling people in? The answer: sign-up bonuses.

Credit card sign-up bonuses were created to incentivize you to sign up for a particular card. In most cases, customers are required to hit a minimum spending requirement within a certain time frame in order to earn the bonus, with the average time being around three months.

When you sign up for a new credit card with the hopes of earning the bonus, it's important to have a plan. First, you need to know the minimum spending required to earn the bonus. Second, you need to know how much time you have. Once you finally have those details pinned down, you only need to follow through and spend the amount required. But, how do you do it?

Focus on food

With the average family of four with two young children spending anywhere between $554 and $1,080 on food each month, many families might be able to hit a minimum spending requirement just by buying food with their credit cards. If this is your strategy, use your card each time you go out to eat or hit the grocery store. Keeping track of what you've spent and where also helps to ensure that you're staying on track with your budget and plans.

Ensure you're insured

Even though they may not advertise it, a lot of insurance companies will allow you to pay your insurance premiums with a credit card. To find out, give your insurer a ring and ask. If your insurer cooperates, you can get that much closer to hitting your minimum spending requirement by using your card to pay for the various types of policies you may carry, including car insurance, homeowner's insurance or renter's insurance.

Fill the tank

If you or your spouse commute for work, using your credit card for gas is yet another way to inch toward the minimum spending requirement for your card. Just make sure to take your card along any time you think it might be time to gas up.

Pay for a trip

If you have upcoming travel plans, putting them on credit might just be enough to push your spending over the edge. Use your rewards card to book flights and hotel rooms, and for the convenience of not having to carry cash while you travel.

Take advantage of other large purchases

When it comes to earning a sign-up bonus, many rewards enthusiasts try to time their credit card applications around large, planned purchases. For many, this might mean signing up for a new card right before the holidays. For others, this could mean planning rewards around upcoming home improvements or when replacing big-ticket items such as furniture or appliances.

Credit card sign-up bonuses are popular for a reason. And for many, pursuing them is a popular and lucrative hobby. However, if you want to get the most out of your sign-up bonus, it's important to pay your card off, in full every month. Otherwise you'll end up paying interest on your purchases. And in most cases, that's a move that isn't rewarding at all.

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