Sunday Reader Question: What’s the Cheapest Way to Hit Credit Card Spend Requirements?

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TPG reader Brenda writes:

"Could you kindly refer me to past blog postings that suggest ways to meet the $3,000 in first three months spend on a Delta Gold Amex card? I know that the mint coin offer is no longer possible, but I sure could use some help with other ways to attain the goal so that I can get the 45,000 mile bonus. I live in the South, and Delta serves my local airport with frequent departures. It is a good match for our family."

I get this question, in some shape or form, every day. We all want the huge credit card bonuses, but not all of us can spend the amounts required to hit the spend thresholds. My best advice is to put as many of your expenses on your credit card as possible, but be warned they aren't all free. There's no way, to my knowledge, to pay car payments with a credit card for free - most financing companies will charge a fee. However, there are a number of ways that will help you hit those spends:

1. Free Electronic Payment Services: Many people use cash or checks to pay people, but savvy points aficionados know that there are a couple payment systems out there that will sync up to your credit card for free. These programs allow you to send payments to other people using that points-earning credit card - without posting as cash advances.

I personally use Venmo and Amazon Payments for a lot of my legitimate personal and business spend. These sites are actively encouraging new members, but you cannot abuse this feature (such as sending thousands of dollars to yourself to create points out of nowhere) or else your account will get shut down forever. To be conservative, you can send about $1,000 a month on each service to other people free of charge using your credit card every month. So the next time you and your group of friends are out to dinner, pay them for your portion using Venmo or Amazon Payments. This is the new future of cashless banking, so I suspect more and more banks will encourage people to switch their financial transactions to become more electronic.

2. Rent/Mortgage/ Car Payments: Though most people pay by their monthly car payments by check as well, there are also services such as Charge Smart that allow you to make such payments by credit card. Just be sure the bank or car finance company through which you secured your loan will accept payments, and you can start making them on your credit card through here. You generally pay a 3% fee, so this may not make sense unless you absolutely have to hit a spend threshold or you will lose out on a bonus.

3. Utilities: You usually have to pay gas and electric with a bank account, but all your other utilities—phone, cable, internet—should all be set up to be paid through a points-earning credit card if that opportunity is given.

4. Dining: Almost all restaurants take the major credit cards—especially Visa and Mastercard—plus many of the major airlines including American and United have dining networks that allow you to earn double points, and up to five points per dollar spent at participating restaurants, so be sure your cards are registered. See here all about double dipping with dining programs.

5. Expenses, Groceries and Gas: Literally every other expense that you can possibly charge, from groceries to dry-cleaning to gym memberships to gas (which can often earn you double points) should be charged to your points-earning card. Remember, if you have the American Express® Gold Card card you get 2x points on gas and groceries.

6. Insurance: This is a big part of all our lives—homeowner’s, car and medical insurance make up a big chunk of monthly expenses that stretch into the hundreds and even thousands. The good news is that many major insurance companies accept credit card payments, so be sure to check with them, and if they do, make your payments that way rather than by check, because otherwise you’re leaving tons of valuable points on the table. In fact, most will even give you a discount if you pre-pay your insurance premiums six months in advance - that way you can pay your insurance now in order to get your bonus quicker and save money.

7. Gift cards: Buy a few Amex gift cards when you know you’ll be spending some money soon, and use the gift cards instead. It’s basically like using your credit card to make charges you’ll be making anyway. But you don’t have to stop there. Instead of buying presents or goods outright, you can use credit cards to purchase gift cards for your friends and family at merchants such as Amazon and iTunes so they can purchase what they want for themselves. Gift cards like this are also a great way to pay people such as babysitters or pet-walkers, or to give them a holiday tip rather than just handing them cash.

8. Shopping: If you’ve been reading my blog, by now you know that most of the major airlines such as Delta, American, Southwest, US Airways, and United (and some credit cards like Amex Membership Rewards and Chase Sapphire Preferred) have online shopping malls where you can earn tons of bonus points, especially over the heavy holiday shopping period. In fact, with certain merchants, you can earn up to 10 points per dollar.

9. Charity: If, like many people, you’d like to make some charitable donations before the end of the year, put away that checkbook and make your donation on a points-earning card instead. Chase Freedom is giving 5 points per dollar on all charitable contributions until December 31, 2011. I recently made a donation to a charity and they were more than happy to take my American Express card with no questions asked.

10. Taxes: Still paying off your taxes from 2010? Well, if you’ve been doing it by check or cash, you’ve been wasting points. For property and state taxes, you can use Official Payments as a third party service, while for federal taxes, check the IRS list of tax payment service providers, many of whom accept payment by credit card. Just beware the convenience fees many of them charge since these may negate the value of points you earn—though if it’s for earning a massive minimum-spend bonus, it can still be worth it.