25 Credit Card Mistakes You’re Probably Making

Mistake No. 3: Not evaluating sign-up bonuses carefully

The thought of collecting 50,000 miles or 75,000 points by signing up for a particular credit card (very often it will be a travel-related card) can be very enticing, but be sure to assess the big picture. For example, look a little beyond the bonus.

It may be worth $500 to you, but how much in ongoing benefits will it offer after that? Be sure it’s enough to surpass what might be a big annual fee. (Many such cards charge $450 or more in annual fees.) Know the terms, too. You will probably be expected to spend a minimum amount with the card in the first three months. Be sure you can do so without making extra unnecessary purchases. It’s often $3,000 or $4,500 required in spending, but sometimes it’s $7,500.

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