Part 2: Flights, Shopping & Subscriptions
(Part 1: Hotels & Experiences can be found here)
If you’re new to reward points, travel hacking or just trying out (or considering) your first American Express card then it’s likely you’re wondering what 20,000 points is worth, and what you’ll get for it. This is because, 20,000 is the welcome bonus new cardmembers receive when they spend £2,000 in their first 3 months with the American Express Preferred Rewards Gold Credit Card. This is the UK Amex card every travel hack blogger is raving about, and most people start with, because in my opinion (for year one at least) it’s just about the best deal out there. We covered the card in post number one here – but just to recap:
– The card is free in year one (£140 thereafter, but can be cancelled at any point)
– It comes with two free airport lounge passes (generally worth about £20 each) – wait for your next flight in comfort, with food & drink included!
– The bonus for a £2,000 spend in 3 months is 20,000 points, which (as we’ll explore below) could be worth anywhere from £100-200
-There is another 10,000 points bonus if you spend over £15,000 in a year.
-There is a $75 hotel credit for any bookings of 2 nights+ through the ‘Hotel Collection’.
-Plus you get all the benefits of being an American Express member, such as targeted offers and access to reserved tickets for gigs and events.
(Note the whopping 56.7% APR though – this is definitely to be used only as a rewards card, i.e. you’ll want to pay your statement in full each month)
You can also increase the welcome bonus to 22,000 points if you use this referral link (scroll down to credit cards to find the Gold card). Given that, as an absolute minimum, this equates to about £100 in Amazon vouchers – even ignoring the other benefits and even if you don’t keep the card thereafter – you’re effectively earning at least £100 just for putting normal spending on this card for 3 months. Of course you can also increase this return further by looking at the options below and/or following my 6 steps to earning serious cashback advice.
So, what can you get with 20,000 points?
There’s no way I can highlight every points option, and there are already some great articles out there which cover point value, so the objective here is to highlight some examples of what 20,000 points could get you under five main categories: hotel stays, experiences, shopping, flights and subscriptions. The first article (here) looked at some contrasting options for hotel stays and experiences. This article explores flights, shopping and subscription options. Hopefully this will give you some insight, inspiration and also an illustration of just how much, or how little, the points can be worth depending on how you use them. Generally there are two ways of using your points: 1) You spend them within American Express, e.g. via Amex travel or as a statement credit or 2) You transfer them out to any of a range of other loyalty schemes (e.g. Avios, Nectar, Hilton Honors).
You can use Amex points to book flights with a range of Amex partners (12 airline schemes to be precise). Note that taxes and fees will still apply for flight bookings (the only exception would be if you used the points as a statement credit against the flight cost, but then you would only get the standard 0.45p per point). Partner airline schemes include: British Airways Executive Club (Avios), Emirates and Virgin Atlantic Flying Club.
Avios is one of the most popular points schemes in the UK, and even has a handy calculator to work out the cost of reward flights. There is also a useful tool called BA Redemption Finder which helps to quickly identify reward flight availability (only a set number of seats per flight can be booked as reward seats). To give a good illustration of options, without you having to do the research, here are some examples of what 20,000 points could realistically get you with Avios:
2 Economy Seats for Return Flights from London to ‘Zone 1’ destinations including Paris, Amsterdam, Geneva, Copenhagen and Milan (off peak starting at 8,000 points + £35 taxes per person) – Note, if you get the 2,000 points referral bonus and then also earn the 1 point per £ on the £2,000 spending, you’d actually have 24,000 points, which is enough for 3 economy seats.
Fly to Copenhagen:
1 Economy Seat for Return Flights from London to ‘Zone 3’ destinations including Gran Canaria, Kiev, Malta and Moscow (off peak starting at 17,000 points + £35 taxes per person)
1 Business Class Seat for Return Flights from London to ‘Zone 1’ destinations including Paris, Amsterdam, Geneva, Copenhagen and Milan (off peak starting at 15,500 points + £50 taxes)
In theory 20,000 points could just about also get you an economy long haul flight. For example, transferring from Amex to Virgin Flying Club would give you enough points for London to New York return. However, £270.72 taxes and fees apply and given that Virgin have some dates available from £295 return on the same route, a £25 discount doesn’t really make for a great use of 20,000 points! For long haul, the better option is usually to save up a few more points and use against an upgraded ticket. For example, the same route is 35,000 points + £448 taxes for a Premium seat, which represents much better value against the standard price which starts at £800+ (in this case you’re getting at least 1p per point).
As I’ve mentioned before, it’s always worth doing the maths before you book (price ÷ points = point value). If you’re getting a lot less than 1p per point for flights, then it might be worth reviewing your options – for example, could you get better value using the points for the hotel rather than the flight?
There are a few shopping options for Amex Membership Reward points (none of them offer anywhere near the value you can get on hotels, flights or experiences):
1) A direct statement credit – which you can use against any transactions on the card. For this you £4.50 per 1000 points, so £90 for 20,000 points.
2) You can transfer the points to Nectar, at a slightly better value of 0.5p per point (Amex to Nectar transfer at 1:1), so 20,000 points would give you £100 to spend at a Nectar partner.
3) Exchange for a Gift voucher via Amex – £25 voucher is 5,000 points, so again 0.5p per point and 20,000 points = £100. Partners include Amazon, Costco, TopShop, M&S.
Gift vouchers will give a better return than statement credits or ‘pay with points’, but you can only exchange set amounts (e.g. 5000, 10000 or 20000 points). However, assuming you’re making a purchase with a gift voucher partner – you could buy the maximum amount and then use any remaining points as a statement credit at a slightly lower 0.45p against that transaction.
So what could 20,000 points get you?
- 82 litres of unleaded fuel at Sainsbury’s with Nectar points!
- An Amazon Echo Smart Speaker or Amazon Kindle Paperwhite (both £89.99, so £10 spare if you use gift vouchers)
- A £100 M&S Gift Voucher
- £90 statement credit against a transaction at ANY store which accepts American Express
Subscription payments can be set up directly through your American Express account. This means your monthly payments for applicable services can be paid automatically from your points each month. This feature is called ‘auto redeem’ and, as long as you have points on your account, they will be used against transactions with your selected service each month. These are applied at a standard rate of 0.45p per point (£4.50 per 1000 points) – again this is roughly half the value you’d get for some travel options. It means 20,000 points would get you £90 of subscription credit. The following subscription services are eligible:
Spotify – 20,000 points = 9 free months of Premium
Netflix – 20,000 points = 16 free months of basic or 9 free months of Premium.
As you’ll note from both of the 20,000 points articles, the returns you can get will vary significantly depending on your option, so it’s always worth doing some research. As an absolute minimum 20,000 points is worth £90 to spend, but potentially it could easily get you £200 worth of flights or hotel stays.
Don’t forget that if you’re considering applying then this link will bag you 2,000 additional bonus points if you hit the spend target (scroll down and you will find the gold card listed under credit cards).
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