Should I Pay a Fee to Meet Credit Card Spend Requirement?
Update: Some offers mentioned below are no longer available. View the current offers here.
TPG reader Carla tweeted this week:
"@thepointsguy do you think it makes sense to pay my expensive NYC rent on a credit card to meet min CC spend if there's a $50 fee to do so?"
In an ideal world we would be able to pay any bill with a credit card with no fee at all. When it comes to mortgages and paying rent, nowadays you can use a service to pay those bills with a credit card, but you'll probably be hit with a fee of around 3%.
Since most credit card spend bonuses are all or nothing, if you won't otherwise be able to hit the minimum spend to earn a substantial bonus, then paying that 2 or 3% is worthwhile. However, I wouldn’t recommend doing this normally, because the redemption value you get back in points and miles won’t match that extra cost. It's only when you're getting the big return of a signup bonus that this strategy makes sense.
There are much cheaper ways to accrue miles and points. Even buying them from the airlines can cost below 2 cents per mile or point, like we've seen with the frequent US Airways 100% Buy Miles offer, which allows you to buy miles at about 1.8 cents apiece. With such good credit card offers these days, you might as well rack up huge credit card bonuses by hitting the minimum spend more quickly with larger purchases rather than just putting your day to day spend on those credit cards, which can take much longer to hit the spend requirement.
Another scenario where I would consider using a service like WilliamPaid to pay rent is if you're close to getting a really lucrative (non sign-up) bonus from a credit card. Suppose you have the British Airways Visa Signature Card and are about to hit the $30,000 in annual spend to get the Travel Together Ticket, which gives you a free companion ticket (even on awards). With that companion ticket, you'll still have to pay the fuel surcharges, which can be exorbitant, but if you really value business or first class, that benefit can save you thousands of dollars. If it takes $100 in fees from WilliamPaid to get a $2,000 companion ticket benefit, then you might as well do it.
Below I've listed some of the more lucrative credit card spend bonuses out there right now, but to reiterate, don’t feel bad paying a small fee if that’s the only way you can meet a minimum spend requirement. If you do have other options, then I'd avoid paying rent like this on a month to month basis.
Ink Plus: 60,000 points after $5,000 spent within the first 3 months.
Citi AAdvantage Executive World Elite Mastercard: 75,000 miles after $7,500 spent within the first 3 months.
Chase Sapphire Preferred Card: 50,000 points after $4,000 spent within the first 3 months.
United Explorer Business: 50,000 miles after $3,000 spent within the first 3 months.
Club Carlson Premier Rewards Visa Signature Card: 85,000 points after $2,500 spent within the first 90 days.
Barclaycard Arrival Plus World Elite Mastercard: 60,000 miles after $5,000 spent within the first 90 days.
The Platinum Card® from American Express: 60,000 points after $5,000 spent within the first 3 months.
British Airways Visa Signature Card : Up to 100,000 Avios after spending $20,000 total in the first 12 months.