The spending requirement is the real price of your credit card bonus

A credit card sign-up bonus is worth taking only when you can hit the spending requirement with money you were going to spend anyway and pay the full statement balance by the due date. Its real value is the bonus minus four costs: the rewards your current card would have earned on the same spending, the first-year annual fee, any fee you pay to push bills onto the card, and interest if any of it lingers. Run those four numbers before you apply, not after.

The four costs that sit behind every bonus

Start with the cost most people skip. If your everyday card already pays 2% cash back with no annual fee, every dollar you move to a new card to chase a bonus stops earning that 2%. On a $4,000 requirement, that is $80 you give up. The bonus has to beat that before it beats anything.

Then add the annual fee for year one, unless the issuer waives it. After that come routing fees: paying rent, tuition or federal taxes by card usually costs a percentage charged by the processor. The IRS’s approved card processors listed fees under 2% for consumer credit cards when we checked their page on October 2, 2026. Many landlords and rent platforms charge more.

The last cost is interest, and it is the only one that can turn a bonus into a loss on its own. Card APRs are high, and the Federal Reserve’s average for accounts that were actually charged interest is shown here:

Three versions of the same offer, worked out

Take an illustrative offer: a bonus worth $600, a requirement of $4,000 in purchases within three months, a $95 annual fee charged in the first year, and 1% back on everything else. Your current card pays a flat 2% with no fee. The requirement works out to about $1,333 a month.

You already spend $4,000 in three months. The new card pays the $600 bonus plus $40 in regular rewards. You lose the $80 your 2% card would have paid, and you pay the $95 fee. Net gain: $465. This is the case the offer is built for, and it is a good deal.

You normally spend $2,500, and you put $1,500 of rent on the card to close the gap. Say the rent platform charges 2.9%. That fee is $43.50. You give up only $50 of 2% rewards, since the rent was not on a card before. Net gain: $451.50. Routing a bill costs a little, but it beats inventing purchases.

You buy $1,500 of things you had not planned, then carry the $4,000 for three months. At an illustrative APR of 24%, interest on $4,000 for 90 days is about $237 (4,000 × 0.24 ÷ 365 × 90). After the lost rewards and the fee, the margin left is about $258. The extra purchases only have to be worth $258 less to you than you paid for them, about 17% of their price, for the whole offer to lose money. Most impulse purchases clear that bar easily.

The pattern is consistent: the bonus survives a fee or two, but it does not survive interest plus spending you did not need. To check how long a carried balance would take to clear, the interest calculation guide walks through the daily math.

Why issuers pay you to spend

A bonus is an acquisition cost. The issuer earns interchange, a fee the merchant pays on every purchase, so a customer who puts thousands of dollars a year on the card is profitable even if that customer never pays a cent of interest. Annual fees add more. The rest comes from people who revolve: about half of credit card accounts carried a balance in 2024, according to the CFPB’s December 2025 report on the credit card market.

The deadline matters for that reason. Three months is short enough that a household with ordinary spending feels pressure to pull purchases forward, and that pressure is where the costs in the third scenario come from.

Read the terms before you count on the bonus

The offer’s fine print decides what counts. Balance transfers, cash advances, fees and interest normally do not count toward the requirement, and some issuers exclude purchases that work like cash, such as gift cards or money orders. Some also limit who can get a bonus at all, for example people who held the same card recently. The CFPB’s May 2024 issue spotlight on credit card rewards found that complaints about rewards often involved promotional conditions consumers did not expect, along with devaluation and redemption problems.

Save a copy of the offer page on the day you apply. If the bonus does not post, that page is your evidence when you call the issuer or file a complaint.

A decision rule before you apply

1. Add up your normal card spending for the bonus window. If it reaches the requirement, or gets within a gap you can close with one bill you already pay, keep going. If you would need to invent more than a small amount of spending, stop.
2. Subtract the four costs. Lost rewards at your current card’s rate, the first-year fee, routing fees and a realistic interest figure. If the net is under about $100, the inquiry and the extra account are not worth it for most people.
3. Check your calendar. A new application adds a hard inquiry, which FICO counts for 12 months. If you plan to apply for a mortgage or auto loan within the next year, apply for the loan first. Our piece on what a hard inquiry costs has the details.
4. Treat year two as a separate decision. The bonus pays once, and the annual fee repeats. Whether the card is worth keeping depends on the annual fee break-even, not on the bonus.
5. Set up autopay for the full statement balance on day one, so the requirement never turns into a balance you pay interest on.

If the bonus comes in points or miles rather than cash, value it at the rate you will actually redeem, not the best rate the program advertises. The cash back vs. points comparison shows how to find that number.