A Family Guide to Category Bonuses – Part 1

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This post is alternatively titled, “Never Earn 1x Again.”  “Never” should really be in quotes as sometimes family life is a little too crazy or busy to never just earn 1x, but it can be the very rare exception with a little planning and thought.  At the Frequent Traveler University, there was some discussion about category bonuses on credit cards (for example 3x on groceries in stand alone grocery stores with the Amex Premier Rewards Gold card).  Some people believe that category bonuses are irrelevant as all spending should be going toward meeting the minimum spending required for various credit card sign-up bonuses.  A portion of my spending each year does go toward meeting minimum spending requirements, but since I am not an aggressive credit card churner, I still have a fair bit of spending to put on whatever card I want.  I am firmly of the belief that more and more credit card bonus categories will be the backbone of the miles and points hobby.  I don’t think that sign-up bonuses will go away completely in any near future, but bonus categories are likely far more sustainable for the long-haul, so in my opinion it makes sense to learn how to maximize every dollar spent.

So, for those who are in the same situation as me, and want to maximize the spending that isn’t going toward a minimum spending requirement – this guide is for you.  I am breaking it into two parts.  This first part will be a bit more conceptual, and Part 2 will have a breakdown of some recommended cards to use in the different categories of spending.  Fortunately (or unfortunately), families often require a relatively large amount of spending to keep things running smoothly, so that spending has to go somewhere, and it might as well go to the card that will give the most bang for the buck.  While there are many ways to approach this, here is how my family decides how to allocate spending.

1.  Meet Minimum Spending Requirements

This one is a no-brainer.  Before you sign-up for a credit card that has a minimum spending requirement, such as the Chase Sapphire Preferred Card that requires $3,000 in spending in the first three months, do some quick math and make sure you can comfortably meet that target.  Of course there are some “creative” ways to meet spending requirements outside of purchases, but that is not something my family really participates in – we just do it the “old-fashioned way”.  Meeting minimum spending requirements is straight forward if you just have one card you are working on, but can get more complicated if you apply for several cards at a time.  For example, if you went for the Sapphire Preferred, as well as used the “two browser trick” to go for the Visa and Amex Citi AAdvantage cards that require a combined total of $6,000 in spending in the first four months.

Now you have $9,000 of spending to work on at once, with $3,000 of it due a month before the rest.  That averages out to $2,250 per month for four months, which is very doable in my family since we charge everything from daycare to groceries to cell phone bills to medical bills to car insurance.  In this case, we would use a spreadsheet to track our progress on the three different cards, but would still pay attention to using the Sapphire Preferred card for the dining and travel expenses as much as possible to get the 2x bonus.

In reality, since we are relatively conservative with our credit card churning, we usually don’t have to funnel all of our expenses toward a new card just to hit the spending requirement.  Instead, we put things that we typically don’t get large category bonuses on from other cards onto the new card.  We can’t always do that, but that is our SOP whenever possible, which takes us to the next category – Category Bonuses.  Though my husband likes simplicity – so he is typically only “assigned” one card to use at any given time.  😉

2.  Category Bonuses

Sign-up bonuses are my show pony, but category bonuses are my work horse.  I hate earning 1x on anything, and thanks to category bonuses, I usually don’t have to.  Some credit cards have built-in category bonuses on things like: gas, groceries, airfare, drug stores, travel, dining, phone bills, hotels, Amazon.com, and office supplies.  I will spend much more time in Part 2 on those categories, but a big part of maximizing category bonuses these days is to think beyond the stated category.  For example, grocery stores and office supply stores often sell gift cards to many other types of stores.  So, if you are in a situation to get 5x (or potentially more if you order the gift cards online through a shopping portal) at one of those retailers, then you now have increased the number of places that you can obtain bonus points exponentially.  This is especially true when you buy Amex, MasterCard, and Visa gift cards as they can be used just about anywhere.  That said, I do think there are some practical limitations for busy families having lots of different gift cards to various retailers, but there are some ways to take advantage of this without too much extra work that I will go over in Part 2.  For today, think of category bonuses not just for their face value, but think a bit creatively as well.

Within category bonuses, also keep in mind online shopping portals such as Chase Ultimate Rewards.  While shopping portals aren’t exactly the same as category bonuses – they are worthy of a mention somewhere in this post as they can turn a 1x purchase into a 5x, 10x, or even 20x purchase, depending on the retailer.

3.  Annual Spending Bonus

Even with all the category bonuses in the world, there will still be some expenses that don’t fall into a stated category, or that you can’t/don’t want to use a gift card for due to issues like convenience, consumer protection, warranties, etc.  Some people will argue that those purchases should be going on a “cash back” card that earns at least 2% back.  That isn’t a bad plan, but it isn’t my plan.  I use credit cards for miles and points, pure and simple.  Not only do I find it extremely rewarding, but I think it is fun.  Consider it a hobby if you will.  So, for me when a purchase doesn’t fall into one of the first two categories, then it goes on a card that earns an annual spending bonus.  Two examples of this are the United MileagePlus Explorer card that gives a 10,000 mile bonus after spending $25,000 on the card each year, or the American Express Premier Rewards Gold card that gives a 15,000 point bonus after spending $30,000 on the card annually.

Assuming you put exactly $25,000 on the United MileagePlus Explorer card each year (which is almost exactly what I put on there last year) you are earning 1.4 miles per dollar on the card including the annual spending bonus.  (Read here about possibly getting a higher sign-up bonus)  With the Amex Premier Rewards Gold Card, if you put exactly $30,000 on the card in a year, you are earning 1.5 points per dollar spent on the card.  Some cards also have different reward bonuses that kick-in after hitting a spending threshold, such as the Chase British Airways “Two for One” Companion ticket that is awarded after $30,000 of spending on the card in a calendar year.  The value of these types of rewards varies somewhat from person to person, but assuming they are valuable for you, it is another example of an annual spending bonus.  Of course, not everyone has the ability to put that much spending on a card annually, but if you can, then it makes sense to target annual spending bonuses with purchases that aren’t already earning a category bonus or going toward a minimum spending requirement elsewhere.

4.  Cards That Earn More Than 1x Already

I mentioned the United MileagePlus Explorer card and its annual bonus that can result in 1.4 miles per dollar for purchases on the card.  That is a good deal, but later this year (once I hit $25K on that card to trigger the bonus and my US Airways Club membership expires) I plan to switch to the United Club Card that gives 1.5 miles per dollar on all purchases.  Not only is it a better return, but it doesn’t require targeting a specific dollar amount to get the maximum bonus.  It is a very expensive card at $395 annually, so it isn’t a good strategy if you didn’t already want United Club access, but it is a good card to use for “1x” purchases if you have it as 1x in this case really means 1.5x.

Another example of a card that earns more than 1 mile per dollar already is the British Airways Visa.  It earns 1.25 Avios per dollar for purchases, so it is another good potential choice for “1x purchases” if Avios are valuable for the way you travel.  A final good example of a card to use in this situation is any card that earns Membership Rewards if you regularly transfer to a hotel or airline that offers periodic transfer bonuses.  For example, Delta and British Airways have traditionally offered many transfer bonuses each year (though Delta has been a bit quiet on the transfer front recently), so for me, the purchases that earn 1x on my Amex really are earning 1.5x when I take advantage of a 50% BA transfer bonus.  To put it another way, the airfare purchases that earn me 3x on that card are really earning me 4.5x when I take advantage of a 50% transfer bonus.

5.  If All Else Fails – Use A Very Good 1X Card

If all else fails, make sure you are using a card for your 1x purchases that provides very valuable points.  In pretty much all miles and points circles, SPG points earned by using the Starwood Preferred Guest Amex are considered very valuable points since they go a very long way when making SPG cash and points reservations, “Nights and Flights” redemptions, and for the bonus 5,000 airline miles that come with every 20,000 points that are transferred to airline partners.  So, if you have to earn 1x for some purchases, you might as well be the most valuable points out there.

This is by no means an exhaustive list of ways to earn more than 1x, but it should hopefully give a good conceptual intro to how my family almost never earns just 1x on purchases.  We also never redeem for just one cent per mile/point, so if you consider an extremely conservative average of 1.5 points per dollar earned for all spending and 1.5 cents per point when redeeming (and our averages are well over 1.5 on both fronts), then you are definitely beating a straight 2% cash back card…..assuming you like searching for and redeeming award flights and hotel nights.  😉  Also, your spending hierarchy may differ if you are concentrating on building just one specific type of awards for a particular redemption you are working toward.  Now that I have explained where category bonuses fit in our hierarchy of spending, Part 2 will concentrate on maximizing those specific category bonuses.

Feel free to add some tips on how your family maximizes category bonuses, annual spending bonuses, etc.  I think this is an area in which we can all learn from each other!


Disclosure:  Some of the credit cards in this post do provide me a commission if you are approved for the card by using my link.  As always, thanks for your support!

The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser's responsibility to ensure all posts and/or questions are answered.



  1. Great read! my patterns are similar to yours, shopping portals are critical and I quickly became glued to 10x earnings from them. I’m concerned about the long term future of Vanilla cards, but for now they can replace some 1x shopping.

    • @Rob, I agree that gift card use/points earning as we know it today may not be around forever, but I’m sure we will all continue to adapt to the next “great thing”. 😉 Glad you enjoyed the post!

  2. I think it also worth reminding the reader to do the math about how much they would spend on a card and how much its annual fee is. Especially for expensive cards.

  3. @Rayn, very true. This post was just based on the cards the reader had already decided to have in their wallet, but this is an important point that deserves its own post.
    @Ted F, thank you. 😉

  4. This is a great post. I have been eyeing the United Club card and trying to decide whether to move my general spend (non-dining & hotel which go to Sapphire) there from Starwood Amex. I think it’s the way to go and am planning on that for my next apporama next month. I need also to get more serious about using shopping portals (I tend to be lazy about that) and also the gift card option (haven’t done that before and need to jump in). Thanks for the analysis; very helpful.

  5. Why would you use a United Card to get 1.5 when you get get a Chase Ink, or Freedom and get 5x bonuses? Thus if I spent $100 with United I’d get 150 united miles but I could get 500 miles with ink or freedom depending on the spend….am i missing something?

  6. @CU, glad it helped you. I totally understand the resistance to starting with shopping portals and gift cards, but it really can take points earning to a whole new level. 😉

    @Ryan from MA, as you say, it all depends on the spend. If I was purchasing something that was in a 5x category somewhere, I would not use the United Club card at 1.5x, I would use the card giving me 5x. The United 1.5 was mentioned for purchases that you aren’t getting a bonus on from any other card. While you can presumably get gift cards using an Ink Bold or Freedom for 5x and use anywhere, I do not plan to do that for all of my spending for many reasons (will go into more detail in Part 2), so I still need options for other purchases. Hope that makes sense. 😉

  7. have done SO MANY GCs, amazon payment other spendings.
    still have some spend reqs left. what is the cheapest to send money online using card and lowest fee? and how is that done? I have paypal account but i don’t know the other services and how.

  8. Happy Mother’s Day Mommy! I hope you had a great day. Thank you so much for all you do for the miles and points community.

  9. Loved this post! So much fun and a thrilling “hobby” to juggle the cards to maximize the points each month. My hubby is on board but I pretty much have to “assign” him a card or two like you mentioned and tell him which one to use for gas, dining, etc. I even put a cheat sheet in his wallet–too complicated! Luckily, I pay the bills for our business and home so we don’t miss too many opportunities for the maximum. I am pretty obsessed. I have found lately that some of my purchases with the ultimate rewards mall were not posting but Chase is great about crediting them with a follow up email. We have always been long time Amex customers but Chase is hard to beat. Thank you so much for posts like these. I always pick up great tips!

  10. I try to do the “double dip” with shopping portals whenever possible as the Chase UR mall tends to give bonus points no matter your payment method. For instance, yesterday I bought a Groupon GC through AMEX to get 4X MR, then bought the item on Groupon through Chase UR to get 3X. I miss the days of 12X on UR, but 7X is better than nothing!

  11. Hi Mommypoints, I always wounder how much are we spending to get these points and miles?

    1) credit cards fees- Did we get the Amex Plat 450.00
    2) how many times do we pay the yearly fee because we can’t live without that card maybe 300.00
    3)Did we attend a do? 1000.00
    4) grand slam? 400.00
    5) Did we pay booking fees and fuel charges?
    6) Did we pay fees for expert flyer.
    7) Did we millage run
    8) Did we try to get hotel status or airline?
    9) Did we buy stuff and say we were going to buy it anyway?
    10)Did we dine out just for the miles and maybe eat at a restaurant we didn’t like to get miles?
    11) Did we attend a work shop? ( Chicago)

    What other expenses do we incur? Yes I do all this stuff too, and yes I have taken International first class trips that would cost 20,000 dollars. However how many families are flying Chicago to St Louis in coach? People like to talk about there successes,but I wounder how many really look at what they are spending. Just worth thing about.

  12. @sanju, pay ahead on utilities, make car payments/rent/mortgage payments online for a fee, etc. If you have already done tons of gc, amazon, etc those may be your best options left.
    @Michael, thank you very much. 😉
    @Kathy, I have had a couple recently that are not posting as normal. I need to follow-up so thanks for the reminder!
    @The Deal Mommy, nice!
    @Chris, sounds like a good post. 😉 I agree that “free” travel isn’t free if you do some of those things. That doesn’t mean they are bad to do, but you do have to look at the overall cost. Of course, some of those things (like DOs) probably aren’t done to get free travel, they are done as this is a hobby, which is a bit different in my book. Still, good point!

  13. Don’t forget every time we use a point earning CC we are buying our points at 2 cents.(rather than using a cash back card)

  14. @Chris, yeah, I mentioned a 2% card in the post, but even the (very) conservative estimates I used show that it is easy to come out ahead of a 2% card with just a little effort and planning.

  15. “Some people believe that category bonuses are irrelevant as all spending should be going toward meeting the minimum spending required for various credit card sign-up bonuses” – agree 100%, end of story.

    • @ORD-TGU, ha ha. As I said, some people fall in that camp. 😉 I do agree that if you have a minimum spending requirement you are working on, then that is where your spending should go. However, not everyone always has a spending requirement they are working on.

  16. @deal mommy: discover shopping portal gives you 15% cash back. You are leaving half your value on the table using your method, unless u don’t have a discover card.

  17. Thanks Mommypoint for a great post. Have you already posted the part 2 yet? I am not able to find it on your blog.

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