Avios credit card

[route101]

Is it worth getting an avios credit card for daily spending?

 

[Watershed]

If you fly with BA or other oneworld airlines regularly then I'd say so. But it depends a lot on your personal circumstances - e.g. will you spend enough to meet the spending target for one of the annual vouchers, and do you want to fly on routes (and at times) when there's likely to be availability in order to redeem the Avios and vouchers you earn.

The amount of pure cashback you can earn on normal credit cards is very low nowadays (because of the interchange fee cap introduced by the EU).

There are a few virtual banks like Chase and Algbra that will offer you 1 or even 1.5% back on your spending, but there are fairly low monthly limits to this so it's not much use if you are spending a lot of money.

There are also transactions where you really want to be using a credit card for the section 75 protection, which you won't get with the debit cards issued by the above banks.

It should go without saying, but you should only be considering an Avios etc. credit card for normal spending that you'll be repaying in full each month. The interest rates on these sorts of cards are typically quite high so you don't want to be paying that!

 

[Jamiescott1]

I tend to put all my everyday spending (supermarkets, pub etc) on mine.
Also check the svios app as some good deals if you link your credit card and spend at certain shops with said credit card (such as 6 avios for every £1 spent at booking.com)
Mines a avios barclaycard. They often have good bonus avios deals for signing up

 

[antharro]

I went the American Express route instead. That way I can throw my points at whichever airline's loyalty scheme is flavour of the month. You can also often transfer between loyalty schemes, so if you're really lucky, you'll get a favourable Amex to airline points exchange rate, then a favourable airline points to other airlines points exchange rate and actually end up with more than you started with. Or you can just use the points with Amex Travel directly.

 

[Jimini]

I went the American Express route instead. That way I can throw my points at whichever airline's loyalty scheme is flavour of the month. You can also often transfer between loyalty schemes, so if you're really lucky, you'll get a favourable Amex to airline points exchange rate, then a favourable airline points to other airlines points exchange rate and actually end up with more than you started with. Or you can just use the points with Amex Travel directly.

Aye, same here. Did look at other options a few years back but AmEx are hard to beat. I'm lucky / fortunate in that I get to keep my points for work travel as well so do quite nicely out of it (4x U.S / 1x Hong Kong / 1x Singapore trips per year).

 

[RJ]

Is it worth getting an avios credit card for daily spending?

Well it depends on what use you will get from the Avios scheme. You need to earn tens of thousands of Avios to get anything meaningful from the scheme.

I used to be into these cards but found ways to make more productive use of my time!

 

[Jamiescott1]

Is it worth getting an avios credit card for daily spending?

To add. I also have a "pay with rewards" card for cashback and an amex for amex points.
See which card gives you a good sign up bonus too.

 

[KT550]

Another thing to consider is that a monthly credit of Avios from a credit card will extend the validity of any Avios in the account.
Can be useful if you aren't flying regularly and getting near the expiry date.

 

[Watershed]

Another thing to consider is that a monthly credit of Avios from a credit card will extend the validity of any Avios in the account.
Can be useful if you aren't flying regularly and getting near the expiry date.

Although of course it's trivial to extend the expiry date of Avios nowadays - you can sign up to Avios for Thoughts, buy literally anything through BA Shopping, boost a handful of Avios through Avios Booster, buy a £1 train ticket through a linked Uber account and so forth.

 

[azOOOOOma]

I just do all spending and always get a companion voucher each year from AMEX. I also fill up at Sainsbury’s and use Nectar which will convert to 250 Avios every time I hit 400 Nectar point.

I also make sure I do online purchases via shopping.ba.com to get Avios boosts. I just make a point of not buying things that are more expensive just for the points.

After 5 years of normal spending I’ve got about 150,000 Avios. I’ve no idea what that will actually get me!

Laura x

 

[Tezza1978]

Check out Head for Points website - lots of info on there. I've got an Amex Gold which I got a decent sign up bonus for- that site recommends it as the best "starter" option. You need to ensure you can repay the balance in full each month. If you want a referral link to increase the signup bonus once you have done your research and decided then send me a PM!

 

[Watershed]

I’ve no idea what that will actually get me!

Avios are often valued at a 'rule of thumb' figure of 1p each - which would make those points worth £1500. It's certainly possible to achieve more than 1p in value, and it's rarely worthwhile redeeming if you're getting less than 1p when compared to the cash alternative.

With a companion voucher, 150,000 Avios will let you book a long-haul business class return for 2 people on most routes. You can use varying amounts of Avios and cash nowadays, so it's pretty flexible.

 

[nlogax]

Some years back I switched to BA Amex Premium Plus which works best for my situation. Focused spend usually ensures I can collect a companion voucher within 6 - 8 months of the collection year and the flexibility of the newer companion vouchers is a real bonus.

I'd be keen to learn if there are some Visa or MC-based options to supplement the Amex.

 

[RJ]

Avios are often valued at a 'rule of thumb' figure of 1p each - which would make those points worth £1500. It's certainly possible to achieve more than 1p in value, and it's rarely worthwhile redeeming if you're getting less than 1p when compared to the cash alternative.

With a companion voucher, 150,000 Avios will let you book a long-haul business class return for 2 people on most routes. You can use varying amounts of Avios and cash nowadays, so it's pretty flexible.

Short haul routes maybe, long haul routes only so far! To cover “most” routes in business, more like 250k is needed!

Some years back I switched to BA Amex Premium Plus which works best for my situation. Focused spend usually ensures I can collect a companion voucher within 6 - 8 months of the collection year and the flexibility of the newer companion vouchers is a real bonus.

I'd be keen to learn if there are some Visa or MC-based options to supplement the Amex.

There are Mastercard options - I use the HSBC Premier credit card which earns 2 points per £1 spent - these can be converted to 1 Avios or 1 mile in a few other schemes.

There are also the Barclaycard Avios Mastercards - I used to have the Avios Plus card which earns 1.5 Avios per £1 spent, but they killed all the fun when they capped monthly earnings.

Both of these cards have annual fees and free equivalents which earn less points.

 

[nlogax]

Thanks @RJ . I believe the HSBC Premier option has a reliance on an HSBC Premier account? Will investigate the Barclays option, tbh I'm not too concerned about a cap..for bills and everyday spend this may work just fine.

 

[Watershed]

Short haul routes maybe, long haul routes only so far! To cover “most” routes in business, more like 250k is needed!

At the 'default' rate that involves using the maximum amount of Avios, yes. But it's also possible to book using fewer Avios and more cash. You can also use Avios Booster to buy some extra Avios at an attractive rate (0.92p each).

 

[AlterEgo]

There is also the Avios subscription, if you really care for it: https://pgt.shopping.ba.com/subscription

I subscribe to the top rate, and 16,667 Avios a month is enough for an out and back to Europe every month.

If you look at it another way - I paid 140K avios for DFW-HND in JAL First Class, which is about £1300 for a one in a lifetime trip which would otherwise cost £10K.

 

[Mojo]

There is also the Avios subscription, if you really care for it: https://pgt.shopping.ba.com/subscription

I subscribe to the top rate, and 16,667 Avios a month is enough for an out and back to Europe every month.

And on the same principle if the OP *really* cares, they can get a Barclays Premier Avios account for £12 per month which gives you 1,500 Avios per month plus after 1 year you get the choice between an Upgrade voucher for redemption with an Avios booking in Premium Economy or Business, or 7,000 further Avios. This is a better cash rate per Avios, but obviously nowhere near as many as you get with the higher level subscriptions. If you combine this with the paid for Avios Barclaycard they will return £5 per month to your current account.

Thanks @RJ . I believe the HSBC Premier option has a reliance on an HSBC Premier account? Will investigate the Barclays option, tbh I'm not too concerned about a cap..for bills and everyday spend this may work just fine.

Yes, you need the HSBC Premier account, but the current account also has the advantage of offering free travel insurance for your household. The paid for card RJ mentions also confers a Priority Pass with free lounge access for one.

 

[kristiang85]

I used to have the basic Avios Amex, but switched to the Platinum Cashback (£25 per year, 0.75% cashback up to £10k, 1.25% after £10k per year).

I found I got more value for my money with the pure cashback one - say on average you spend £15k a year on that card, you will get £137.5 back (=112.5 after fee), which can be spent on anything.

The avios are worth about 140:£1 I think, which means only £107 back for £15k spend, and that can only be spent on avios stuff. I also found that straight reward flights are a bit of a ripoff; you can save more avios by part spending cash, but its still not that great a saving.

The paid avios cards look better value, especially if you get a good bonus on joining (recently they had a 50,000 avios promo), and you get the companion voucher, but given I can only travel with my wife in school holidays as she's a teacher, reward flights are hard to come by, so it works out better value to shop around anyway. And the annual fee of £125 (or is now £250?) is a bit of a killer. There a couple of lounge passes thrown in too, but again I did the maths and after 1 year I can't really see the value continuing.

So I've been on the straight cashback one for a few years and its a nice little bonus I get every June. ALso this year will be particularly juicy as I've put a lot of home renovation stuff on it, so I've exceeded £30k, so that will be particularly good this summer.

It's a pity we don't get the great credit card deals you can get in the US, where it really is worth playing the game to get airline points, but its just a bit too overregulated for that to happen over here.

 

[Watershed]

The avios are worth about 140:£1 I think

That's their value (or at least, used to be until recently) when 'cashed out' as Nectar points or other cash equivalents. They're worth significantly more than that when redeemed well. I've achieved an average of nearly 4p in value over my last 600,000!

which means only £107 back for £15k spend

As above, that would be a pessimistic, worst-case valuation. It would almost never be worthwhile redeeming at such poor rates.

and that can only be spent on avios stuff

That's the one restriction on it all - you get the most value by redeeming on flights. Redeeming on most other things isn't worth it.

I also found that straight reward flights are a bit of a ripoff; you can save more avios by part spending cash, but its still not that great a saving.

It depends entirely on the cash prices, since the Avios redemption rates are fixed, varying only depending on whether it's a peak or off-peak day in the relevant airline's redemption calendar.

There are times where you would indeed get poor value, and a lot of people naively assume that you get the best value from the default option you're presented with, which for short-haul flights costs only 50p per person per flight. In fact it's often one of the middle or lowest options that work out best.

But I would say at least 50-60% of the time - typically if you're not chasing Tier Points or taking advantage of a dirt cheap cash fare (e.g. £27 Luxembourg to London!) - it's worthwhile redeeming.

The paid avios cards look better value, especially if you get a good bonus on joining (recently they had a 50,000 avios promo), and you get the companion voucher, but given I can only travel with my wife in school holidays as she's a teacher, reward flights are hard to come by, so it works out better value to shop around anyway.

Reward flights are indeed not available in unlimited quantities - the trick is to book far in advance. For popular destinations that means ideally 355 days ahead when the seats get released (at midnight if it's a super-high-demand destination like Sydney, Tokyo, Maldives etc.).

Otherwise there is also additional redemption availability that the Amex 241 voucher unlocks in business class, particularly so from regional UK airports as it has some correlation with the fare categories on sale for cash.

It's a pity we don't get the great credit card deals you can get in the US, where it really is worth playing the game to get airline points, but its just a bit too overregulated for that to happen over here.

OTOH they pay much higher interchange fees and many places add on credit card fees - whereas here, they're illegal.

 

[RJ]

At the 'default' rate that involves using the maximum amount of Avios, yes. But it's also possible to book using fewer Avios and more cash. You can also use Avios Booster to buy some extra Avios at an attractive rate (0.92p each).

Not using the maximum amount of Avios, I’m talking about the default rates shown on the charts and in the calculator. 75k for one business class leg will cover Europe and a few places beyond, but long haul flights to parts of America, Asia and further are more than that.

If you reduce the number of Avios used then the value of return on the Avios gets worse and you might as well just pay cash outright.

 

[Watershed]

If you reduce the number of Avios used then the value of return on the Avios gets worse and you might as well just pay cash outright.

Not necessarily so. Taking the Zone 8 (6,501 to 7,000 mile) band as an example, the default off-peak rate is 110k Avios + £300. The next step down is 92k + £365. At 1p per Avios those work out at £1400 and £1285, respectively.

Even the 'worst value' option - 57k + £950 - works out at £1520, which is hardly much worse than the default rate of £1400.

A business class return for that kind of distance would typically set you back well over £4k so there is a significant saving to be made. Of course if cash prices are very low (e.g. during the off-season and when there's a sale on) that may be the better option.

The key thing to do is to compare your options. Blindly going for one thing or the other will rarely get you the best value.

 

[nlogax]

Bad news; it appears the annual fees for BA Amex Premium cards are rising from £250 to £300. Worse still the annual spend requirements for both free and Premium versions are rising to £15,000 from £12k and £10k respectively.

Turning Left for Less piece

There’s bad news for those who hold a BA Amex Premium Plus card today as a price increase along with a large rise in the requirements for a minimum spend are introduced.

Time to re-evaluate BA card strategy for this year, it seems.

 

[Watershed]

Bad news indeed but given that the £10k threshold was set back in 2004, the increase in the spend threshold is perhaps understandable to keep up with inflation. In fact it's less than inflation over that period.

The increase in the annual fee, much less so as it was only increased from £195 quite recently, so well above inflation. Increasing the threshold in the middle of people's spend years also isn't cricket - but pro-rata refunds of the fee remain available, which I imagine will satisfy most who want to ditch the card as a result.

The value you can achieve from the vouchers remains significant (I'm saving over 70k Avios with this year's voucher), and the Avios earning rate is only equalled by the Barclaycard Avios Plus card, which has several other drawbacks (not least the much less valuable voucher, plus half the earnings on BA spend).

So realistically speaking they could probably have hiked both the fee and spend target even higher and still kept a lot of customers.

 

[nlogax]

..the Avios earning rate is only equalled by the Barclaycard Avios Plus card, which has several other drawbacks (not least the much less valuable voucher, plus half the earnings on BA spend).

So realistically speaking they could probably have hiked both the fee and spend target even higher and still kept a lot of customers.

Indeed, and I've just gained a Avios Plus Barclaycard to fill the earning gap between now and the start of my Amex collection year in July. I can do the £10k on the new card easily enough but an additional £10k by Oct 31st for the Amex will be a struggle so I'll inevitably have a choice to make.

 

[AlterEgo]

£10K always seemed a very low threshold for the benefits received. I'm not surprised it's gone up, although the fee increase seems quite steep to me. I'll still keep the card as it's certainly worth it for me.