2 ways you can use your stimulus payment to unlock credit card rewards

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  • If you plan to spend your stimulus check, consider opening a new credit card to earn rewards.
  • You could use your spending to meet the minimum spending requirement for a large welcome bonus.
  • It’s a good opportunity to splurge on a premium card with luxury benefits if you wouldn’t otherwise.
  • Read Insider’s guide to the best travel rewards credit cards.

As the third round of stimulus checks arrives, many Americans are using the funds to pay off credit card debt they’ve accumulated during the pandemic or investing the money to build wealth.

If you don’t need to pay off debt and plan to spend your stimulus check instead of saving it, you can leverage your extra cash to earn additional credit card rewards and give your points and miles balances a boost for a trip when the pandemic is over.

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Here are two great ways to stretch your stimulus check by earning bonus rewards for your spending.

We’re focused here on the rewards and perks that come with each card. These cards won’t be worth it if you’re paying interest or late fees. When using a credit card, it’s important to pay your balance in full each month, make payments on time, and only spend what you can afford to pay.

Earn a hefty credit card welcome bonus

Credit card issuers attract new customers by offering generous welcome bonuses for opening a new account, but there’s usually a minimum spending requirement to meet.

For example, the Marriott Bonvoy Brilliant™ American Express® Card currently has a substantial welcome offer: Earn 125,000 bonus Marriott Bonvoy points after you use your new Card to make $5,000 in purchases within the first 3 months, plus up to $200 in statement credits for eligible purchases at U.S. Restaurants within the first 6 months of Card membership.

This amount of spending over three months may be outside of your budget, and you certainly shouldn’t make unnecessary purchases or take on new debt just to earn rewards. However, you could use your stimulus payment to pre-pay expenses that you would normally incur, such as health insurance, car insurance, utilities, or tax payments.

Other cards with big welcome offers:

  • Chase Sapphire Preferred® Card: Earn 80,000 points after you spend $4,000 on purchases in the first three months of account opening; plus, earn up to $50 in statement credits toward grocery purchases in the first year ( $95 annual fee)
  • American Express® Gold Card : Earn 60,000 points after you spend at least $4,000 in your first 6 months of account opening ($250 annual fee) (See Rates)
  • United℠ Explorer Card: Earn 40,000 bonus miles after you spend $2,000 on purchases in the first 3 months your account is open, plus 25,000 bonus miles after you spend $10,000 in the first 6 months (annual fee of $95, waived the first year)
  • Delta SkyMiles® Gold American Express Card: Earn 70,000 bonus miles after you spend $2,000 in purchases in your first 3 months from account opening (annual fee of $99, waived for the first year) (See Rates)
  • Blue Cash Preferred® Card from American Express: Earn $300 statement credit after you spend $3,000 in purchases on your new Card within the first 6 months ($95 (waived the first year) annual fee) (See Rates)

Splurge on a premium card and get luxury benefits

If you’re ready to come out of isolation and start traveling again, you might consider using your stimulus check to pay for the annual fee on a luxury travel rewards card.

For example, The Platinum Card® from American Express offers benefits such as airport lounge access, complimentary elite status with Marriott and Hilton, and access to luxury hotel perks through the Amex Fine Hotels & Resorts program. 

You can use a portion of your stimulus money to pay for its annual fee of $550 (See Rates), but you can receive much of it back in the form of statement credits. The Platinum Card offers up to $200 in annual airline incidental fee credits, up to $200 in Uber Cash credits per year toward Uber rides and Uber Eats, up to $100 in Saks Fifth Avenue credits each year, and up to $100 credit toward a TSA PreCheck or Global Entry application or renewal fee (for anyone, not just yourself). 

Read Insider’s guide to the best premium credit cards and read our comparison of the Amex Platinum and Chase Sapphire Reserve to find out which card is right for you.

Likewise, the Chase Sapphire Reserve® is a top-tier travel rewards card that includes Priority Pass airport lounge access, excellent travel insurance, and purchase protection. You can use your stimulus payment to cover its $550 annual fee, while receiving much of that back in statement credits.

The Chase Sapphire Reserve® comes with up to $300 annual travel credit (through December 31, 2021, grocery and gas purchases also qualify), up to $100 credit toward a TSA PreCheck or Global Entry application or renewal, up to $60 in annual DoorDash credits (through December 31), and up to $120 in annual Peloton credits (through December 31).

What not to do with your stimulus payment 

While it’s great to receive a boost to your bank account from Uncle Sam, the last thing you should do is to just spend it on things you don’t need in the pursuit of additional credit card rewards. The value of any rewards you earn from an unnecessary purchase will be worth just a small fraction of what you paid.

An even worse decision would be both spending your stimulus and incurring debt to earn a new account bonus. But by using your stimulus to pay for everyday expenses that help you earn a welcome bonus, or to pay for a luxury credit card’s annual fee, you can use your extra cash to enjoy more rewards and benefits than you would have otherwise. 

Jason Steele has covered credit cards, award travel, and other areas of personal finance since 2008. He also produces CardCon, The Conference for Credit and Credit Card Media.

Chase Chase Sapphire Preferred® CardChase Marriott Bonvoy Boundless™ Credit CardChase Chase Freedom Unlimited®

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Please note: While the offers mentioned above are accurate at the time of publication, they’re subject to change at any time and may have changed, or may no longer be available.

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