Travel rewards credit cards

CHOICE identifies the cards that offer the best value for your spending levels.
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04.Rewards card tips

Before signing up for a specific travel rewards card, consider how to gain maximum value from it:

  • Many gold and platinum cards offer instant benefits, such as concierge services, free domestic flights and travel insurance. These also have terms and conditions to consider, but can add real value.
  • Credit card providers often offer more than one card type. Usually, you can get an American Express (Amex)-based card and a Visa or MasterCard. Amex-version cards typically earn more points, but not all vendors accept Amex and still others charge a surcharge on transactions. If you have to pay extra for using Amex, it will lessen the value of the rewards you might receive.
  • Joining an airline’s frequent traveller club is another common requirement of travel rewards cards. Depending on your chosen credit card, this might be free or available at a discount, but in some cases you may have to pay a joining fee. Joining the Qantas Frequent Flyer program currently costs $82.50 unless you join the Woolworths Everyday Rewards program, which waives the fee.
  • Both airline reward programs offer ‘Rewards Seats’ when you want to redeem points for flights. These are offer the best points return value but are generally offered at lower availability, so plan to book ahead and be prepared to be flexible with dates and times. There is also an ‘Any Seat Award’ function that allows you to purchase seats available to the general public. However, this typically costs significantly more.
  • Velocity Rewards seats are often offered at a special rate even further below the regular Rewards points prices thanks to Virgin’s special ‘Go’ fares being available with the program. You still need to be flexible and book ahead, but there is a good chance you can find a seat for even less. Qantas Classic Award seats are fixed, so they do not allow you to access sale fares in the same way.
  • Many programs offer bonus points for shopping with selected partners. This can be a great way to boost your points balance, but be wary of changing your spending habits to earn rewards. Paying more for products or missing out on specials will cost you far greater than any rewards value in the long run.
  • Check out the  rewards credit card user's guide to discover the best ways to use rewards cards and avoid common traps. 

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Confusing conversions

Most travel rewards credit cards allow you to earn points in two different ways. You can either link your card directly with an airline’s frequent traveller program, such as Qantas Frequent Flyer, or accumulate points onto the card’s own scheme. While both options provide a range of travel rewards, it’s important to watch how your points are being accumulated and converted.

Take the Commonwealth Awards card with the Qantas Frequent Flyer option, for example. You earn 1.5 Commonwealth Awards points for every $1 spent using the Amex option. This is automatically converted and transferred each month into the QFF program, but the fine print reveals the points only convert at half the rate. In other words, you’re only earning 0.75 QFF points for every dollar spent, which means you have to spend more to earn that reward.

CHOICE believes it’s both confusing and misleading to make the consumer think they’re earning more points than they really are. Whether your chosen card earns 1 or 1000 points per dollar, the points are only as valuable as the rewards you can redeem. So take note of the points cost of a reward and any reductions when converting points to another program.

How we analyse 

We look at the number of points needed for a sample reward and the dollar value of that reward. We then divide the points required by the dollar value, which gives the points value for $1 spent towards a reward. We use that number to compare the return on three monthly spending levels, $1000, $2500 and $5000, then deduct the compulsory annual fees and factor in any points capping or spend hurdles.

Sample rewards

  • Travel voucher: $500 voucher for a range of travel providers, including Flight Centre, WebJet, Harvey World Travel, Qantas Holidays and BlueHolidays.
  • Flights: To determine the value of a rewards flight, we look at standard fare economy return flights (including baggage) to four destinations, over four different periods in the year for both the Qantas Frequent Flyer and Velocity partners (32 flights in total; prices taken from each airline and airline partner’s website both including and excluding taxes). Flights used were Sydney-Brisbane, Melbourne-Auckland, Sydney-Bangkok and Sydney-London.

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