What is Credit card welcome bonus?
A welcome bonus (also called a sign-up bonus) is a one-time reward you earn for opening a new credit card and spending a set amount within a set time. It usually comes as a lump of points, miles, or cash, and it's often the single biggest reason a card's first-year value beats every year after. Issuers offer it to win your application and your early spending.
How it works
The issuer sets two conditions: a minimum spend and a window to hit it. Meet both and the reward posts to your account. Fall short on either and you get nothing. Take the Chase Sapphire Preferred. Its offer is 100,000 bonus points after you spend $5,000 on purchases in the first 3 months from account opening, worth about $1,250 toward travel. The clock starts the day the account opens, not the day the card arrives in the mail. Only purchases count toward the $5,000; fees, interest, balance transfers, and cash advances usually don't. Once you cross the threshold, the points typically show up within a billing cycle or two. Windows and spend requirements vary a lot. A no-annual-fee cash card like the Wells Fargo Active Cash pays $200 after just $500 in the first 3 months, easy to hit with normal spending. A premium travel card asks for far more.
Why it matters when picking a card
The bonus can dwarf everything else a card earns. 100,000 points is worth more than years of everyday spending would return on most cards, so a strong welcome offer often decides which card is worth applying for right now. When you compare cards, weigh three things together: how big the bonus is, how much you must spend, and how long you have. A $200 bonus after $500 is nearly automatic. The Amex Platinum advertises a welcome offer as high as 175,000 points after $12,000 in 6 months, but it's an "as high as" figure (some applicants are approved for less), and $12,000 is real money you'd need to spend anyway. Chasing a bonus by buying things you don't need, or carrying a balance and paying interest, wipes out the reward. Check the eligibility fine print before you apply, because a bonus you can't earn is worth zero. Chase rarely approves applicants who've opened 5 or more cards in 24 months (the 5/24 rule). Amex generally pays its welcome bonus only once per card product, ever. Citi blocks the bonus if you got one on the same card family in the past 48 months.