Welcome Bonuses 101

Last Updated: 04/09/2021


Some credit card companies pay big incentives to get customers. We answer your big questions.

Credit card companies make a lot of money off their customers—so much money that they can offer generous incentives for opening a new account. Those incentives are called welcome bonuses or sign-up bonuses. They’re basically lump sums of cash, loyalty points or other rewards, paid out after you get a new credit card. 

You may have seen welcome bonuses mentioned in ads, on mailers, or in personal finance articles. They’ve become something of an industry staple. And while they can be truly valuable—worth hundreds of dollars or even more—they can also be confusing. 

The welcome bonus isn’t the only factor you should consider when choosing a credit card, but it is a significant one. The GigaPoints guide covers what you need to know. 

Does every credit card come with a welcome bonus? 

Nope. It’s common for credit card companies to offer bonuses to entice customers to open new accounts, but not every card comes with a bonus. Rewards cards are more likely to offer extra points or cash back for signing up, while secured credit cards and cards marketed through your bank rarely do. The rule of thumb: The more expensive and exclusive a card is (in terms of the credit required) the more likely it is to offer a sign-up bonus. 

Are welcome bonuses cash? 


Cash-back credit cards offer welcome bonuses in the form of a statement credit that gets applied to your spending balance. For example, the American Express Blue Cash Preferred card pays $300 back after you spend $3,000 within the first six months of opening your account. The Chase Freedom Flex card offers a $200 cash back bonus after you spend $500 in the first three months of opening your account. 

Other cards pay out bonuses as points—airline points, hotel points, transferable points—gift cards, or even discounts on your first purchase, as with some retailer credit cards. 

It’s important to understand what kind of bonus is being offered before you apply for a card—no matter how big the offer. You want a card that meets your financial goals, not a big pile of points you may never use. 

How big are welcome bonuses? 

Welcome bonuses vary widely. Cash-back cards tend to offer smaller sign-up bonuses—often $150 to $300, though business cards can go much higher. 

One exception: Discover It Cash Back card, which offers unlimited cash-back matching for the first year. Whether you earn $100 or $3,000 cash back on your card, you’ll get the same amount again at the end of the year.  

Points or miles bonuses will generally have higher values than cash back bonuses, but they almost always have limitations, and their value depends partly on how you use them. 

When we published this article, for instance, the IHG Rewards Club Premier credit card was offering 140,000 bonus points for new cardholders who spent $3,000 within the first three months. Those points could be worth more than $1,000—but only if you use them on IHG hotel or resort stays. You can move them to certain airline loyalty programs, or use them for online shopping, but they may be worth 80% less. 

Chase Sapphire cards are known for their generous and flexible bonuses. If you get 80,000 Chase Ultimate Rewards for signing up for a card, that’s worth $800 in cash and at least $1,000 in travel—possibly much more, if you transfer it to an airline or hotel loyalty program. 

It’s important to know how much reward points are worth before you sign up for a card. Numbers like 50,000 and 75,000 may sound impressive—but some simple math will reveal if they really pay. GigaPoints performs valuations of various points programs; you can read more here. 

How do I know which bonus to go for?

The first thing you’ll want to figure out is which type of reward you want to earn: cash back or points. Cash back is more straightforward; points can be more lucrative. GigaPoints goes into more detail about points vs. cash back

Next, focus on which card will earn you the most rewards—in both short and long term. A big bonus is great, but if the card you signed up for gives you skimpy rewards for your ongoing spending, you could be leaving a lot of money on the table. Conversely, a card with a smaller sign-up bonus may end up being worth keeping over the years, because it pays a lot of rewards for your particular spending habits. 

Not to brag, but GigaPoints is really—really—good at figuring out how much you can earn from different credit cards. We have an algorithm that will match your individual spending patterns to various reward programs and identify which will pay you the most. Often, the card you think is best for you—because you like to shop at a certain store or fly on a specific airline—isn’t. 

Go ahead, give it a try and see what we recommend for you. 

Are there catches to welcome bonuses?

They’re not so much catches as rules. 

Welcome bonuses can be really valuable—worth more than $1,000, depending on the card, the size of the bonus, and how you use the points. But most companies will require you to spend a certain amount of money on your credit card to qualify for a bonus. And normally, you’ll have to spend that amount in a specific amount of time, usually within 30 to 90 days of opening your account. 

Welcome bonus offerings can also change, with or without notice. An airline card may be willing to give you 70,000 miles for spending $2,000, but only if you open an account by a certain date. A bonus offer that’s available one week may vanish the next. 

Do I have to track my spending to get my welcome bonus? 

Nope, the credit card company does that automatically. No need to keep receipts, either. 

But if you’re not going to transfer all your spending on the new card—or you may not meet the spending requirement for a bonus with your normal spending—it’s a good idea to keep tabs on your total, so you don’t miss out on those extra points. And don’t forget that your annual fee does not apply to your welcome bonus spending, no matter how big it is.  

Do balance transfers count towards spending for welcome bonuses? 

It would be nice, but no. 

Should I wait for a bigger bonus?

It depends. 

Some cards boost their welcome bonuses—a bonus bonus, if you will—on a regular basis. If you know which card you want to add to your wallet but are in no particular hurry, it might be worth waiting a few months to see if you can score a bigger bonus. But it’s not worth waiting for a unicorn-type bonus, the kind that comes around every several years—or might only happen once in a lifetime. 

Your financial situation also comes into play. If you’re a big spender, the points you would miss out on by waiting can outweigh the additional value of a larger bonus. If you’re transferring a balance to a lower-interest card, speed takes priority over any potential welcome bonus. Choosing a card that fits your spending habits over the long term is more important than a one-time windfall. 

When can I expect my bonus?

You’ll probably be waiting several weeks. Chase says it takes six to eight weeks to distribute Ultimate Rewards welcome bonuses. Other cards say one to two billing cycles—which is about the same, in the end. A few credit card companies award welcome bonuses a few business days after you’ve met the spending requirements. 

If you’re trying to get your welcome bonus quickly, try to meet your spending goal early. And make sure that whatever purchases you make to qualify are made at least a week before your billing cycle closes.  

Can I return the purchases I make to meet the spending requirement for a bonus?

Yes, but the refund will be deducted from your spending. If that puts you under the spending requirement for the welcome bonus, you’ll lose it. 

Some credit cards require you to spend a good chunk of money to qualify for a welcome bonus. The IHG Rewards Club Premier Credit Card, for instance, is currently offering a 140,000-point bonus, but only if you spend at least $3,000 within three months of opening your account. 

Maybe some of those purchases didn’t work out—or you’re hoping to game the system. Either way, the dollar value of your returns will be subtracted from your spending balance. If that puts you under the welcome bonus requirement, say goodbye to all those shiny points. Even if your refund hits after you’ve received your bonus, some companies will take the points back. 

As long as you’re not extending yourself financially, it’s smart to overshoot your spending requirements for a welcome bonus, in case you do want to return something. Otherwise, make sure whatever you buy, you’re certain to keep. 

Can I cancel my card after I get my bonus?

You can cancel your credit card at any time, but depending on the card issuer, you may lose access to your bonus. 

With airline or hotel rewards cards, like the Delta SkyMiles Gold American Express, bonus points automatically transfer to your loyalty account. Even if you cancel your card, you’ll be able to use those miles. 

Chase and American Express let you access bonus points after you cancel your account—but with specific conditions. Your account has to be in good standing and you’ll only have access to the points for a certain amount of time. 

If you cancel a Capital One account, however, you’ll lose access to your points. 

Before you make any big moves, make sure you read the fine print—and transfer, cash out, or redeem your miles before you call customer service. 

I signed up for a credit with a welcome bonus, but didn’t get it. What’s up? 

If you didn’t receive your welcome bonus, it’s possible you didn’t meet your spending requirement by the deadline. The clock starts ticking once you open your account—not when you activate your card, which can come several days later. 

User error is another possibility. In the case of an airline or hotel credit card, rewards are usually transferred directly to your loyalty account, not to your credit card account. If your loyalty account information wasn’t entered correctly, your points may be floating in the void—or worse, in someone else’s account.  

You also may not have been eligible for the welcome bonus. Some credit card companies won’t give you the bonus if you’ve gotten one for the same card in the past. Others will only make you eligible if a certain amount of time has passed since your last welcome bonus. 

If you think you’ve met the requirements for your welcome bonus, contact the company and present your case. Gather all the paperwork you can to show that you’ve kept up your end of the deal.

Can I share my bonus?

Feeling generous? The easiest way to share your welcome bonus with someone is to make  them an authorized user on your account. Needless to say—but we’re going to say it anyway—only do this with people you trust. 
You can also pool or transfer certain kinds of reward points. Chase Ultimate Rewards allows sharing between your own accounts, as well as with “one member of your household” (you’ll need their name and credit card number). Citi lets you transfer points to anyone who also has a Citi ThankYou account. Capital One allows you to share as well—but you have to do it over the phone. In other words, rules vary between programs, so check with your credit card company before you make any promises.