What are the best credit card bonuses for LONG TERM spending?

(EDIT:  This article was updated in December 2016)

The majority of the credit card posts on Head for Points are focussed on exploiting sign-up bonuses.  Get a card, spend the minimum required to trigger the bonus, cancel the card, move on.  After a couple of years, you can re-apply for the first card you got and claim the bonus again – it is a virtuous circle!

However, if you are a high to medium spender then the few thousand pounds of card spend required each year to hit your sign-up bonus targets will not be a stretch.  You need to consider where to put the rest of your annual spend.

In an effort to cut down on card churn, many issuers are now offering incentives for spending £10,000+ per year on their cards.  The value of these perks is often underestimated – they are often worth far more than the points for your normal spend.

In order of value, lets take a look at what is out there.  This analysis ignores the value of any sign-up bonus or ‘first year free’ deal – I am looking for the best long-term solution.

The results summary is (based on spending just enough to trigger the relevant long-term bonus):

  • BA Amex Premium Plus – 10.1% back on first £10,000
  • BA Amex – 6.1% back on first £20,000
  • Lloyds Avios Rewards Amex & Visa – 4.9% (if all Amex spend) on first £7,000
  • Virgin Atlantic Black Amex & Visa – 3.1% back (if all Amex spend) on first £10,000
  • IHG Rewards Club Premium MasterCard – 2.3% back on first £10,000
  • Hilton HHonors Visa – 2.25% back on first £10,000
  • AA FuelSave – 0.5% cashback paid on all spend + extra on fuel purchases

I will explain the basis of my calculations below.

Our base comparisonThe AA FuelSave Credit Card

This is the best free Visa or MasterCard cashback card currently available against which I am comparing the others.  The AA FuelSave card is free in the first year and offers 0.5% cashback on all spending, 2%-4% cashback on fuel purchases and – in year one – free AA breakdown cover.  The representative APR is 22.4% variable.  If a loyalty card can’t beat the best cashback card, you should take the cashback and book your flights and hotels directly!

The winner British Airways American Express Premium Plus card

This is not exactly a surprise.  Spend £10,000 on this card and you get a voucher which gives you 2 Avios redemptions (on BA planes, ex-UK only) for the miles of one.  On an average redemption (2 Club World tickets to San Francisco on a peak day, say), this saves you 150,000 Avios points!

Based on my 0.75p per Avios point valuation, the 2-4-1 voucher is ‘worth’ £1,100.  You also earn 15,000 Avios for spending £10,000 (worth £110 assuming 0.75p per Avios) with an annual fee of £195.  The net benefit for spending £10,000 = £1,015 (£1,100 + £110 – £195) or 10.1% of spend.

BA Amex - NEW

Runner-upBritish Airways American Express card

The standard, free, British Airways Amex gives you a 2-4-1 voucher when you spend £20,000, and a lower 1 mile per £1 on your spending.  Using the same maths as above, £20,000 of spend gets you £1,100 of 2-4-1 benefit plus 20,000 Avios for your £20,000 of spending, worth £150.  There is no fee.  The net benefit for spending £20,000 = £1,250 or 6.1% of spend.

However, if you plan to earn the 2-4-1, the British Airways Premium Plus Amex is more attractive.  The card has a higher earnings rate and the 2-4-1 voucher lasts for two years instead of one.

Honourable mention, airline category Lloyds Avios Rewards Avios American Express and MasterCard

This is a tricky one to value.  You earn 1.25 Avios per £1 on the American Express but only 0.25 Avios per £1 on the MasterCard, so your spending mix is key.  There is a £24 annual fee.

The Lloyds Avios Rewards card comes with an upgrade voucher when you spend £7,000.  This allows one person to upgrade a return Avios reward flight by one class.  I am assuming that the upgrade voucher is used to upgrade a World Traveller Plus ticket to New York to Club World on a peak day, saving 40,000 Avios.

You would earn 8,750 Avios, worth £65, for the £7,000 spend.

That means you will receive 40,000 Avios of value from the upgrade (£300 value) plus £65 of Avios for spending £7,000 on the American Express card.  Deduct the £24 annual fee and the benefits are worth £341 on £7,000 of spending, or 4.9%.

Honourable mention, hotel categoryIHG Rewards Club Premium MasterCard

The premium version of the IHG Rewards Club card gives you a voucher when you spend £10,000 for a free night in ANY IHG Rewards Club property.  I am assuming you use this somewhere expensive, such as the InterContinental in London, Paris, Hong Kong, New York etc for a £250 room.  (I used my last one at the InterContinental New York Times Square.)

In addition, you would have earned 20,000 points from your £10,000 of spend which I value at £80.  The card fee is £99.  The net benefit for spending £10,000 = £231 or 2.3% of spend.

Honourable mention, hotel category – Hilton HHonors Platinum Visa

This one really depends on your hotel stay pattern. Spend £10,000 on the card in a calendar year and you are given Hilton Gold staus for a year. Hilton Gold gets you free breakfast and a guaranteed upgrade, but this is still achievable for free via occasional promotions.  And, fundamentally, if you stay enough at Hilton properties to get real value from this then you probably stay enough to earn a Gold card.

Assuming that you and your partner spent 5 nights a year at a Hilton then the breakfast benefit is worth £125+.  Add in £100 of value from the 20,000 Hilton points earned from your £10,000 spend to achieve Gold and the £0 card fee, and you’d have a net benefit of £225 or 2.25% of spend.  This is VERY dependent on your Hilton stay pattern, though.

Honourable mention, airline categoryVirgin Atlantic Black American Express and Visa cards

The Virgin Black card comes with two benefits which may or may not work for you.  The one I do not value is the ‘free companion ticket’ voucher for spending £7,500.  This voucher is ONLY valid when the other person buys a full (or almost full) fare flight for cash.  It is generally only beneficial to someone travelling on business on a refundable ticket who wants to take their partner along.  Very few people will have the flexibility or lifestyle to do this.

The other benefit does have value.  For spending £5,000 you receive a voucher for an upgrade to Premium Economy when you book an Economy redemption flight.  A 2nd voucher comes at £10,000, which you would need if not travelling alone.

On a route such as UK-Los Angeles, the miles saving (based on the cost of Premium Economy versus Economy) would be 22,500 miles per ticket.  Assuming you can find availability (and Premium Economy is a small cabin), the value you get for £10,000 of spend is 45,000 miles which I value at £300.

You would also earn 20,000 Virgin miles for your £10,000 spend if it was on the Black Amex, worth £150.  The card fee is £140, so the net gain is £310 or 3.1% of your spend.

I also considered the value of the long-term spend bonuses on these other cards, but dismissed them as poor value:

Starwood American Express – upgrade to SPG Gold status for spending £15,000 and free weekend night for spending £25,000.  SPG Gold has only modest benefits and is often available for free, eg as an Amex Platinum benefit.  The free weekend night is valid only at Category 1-4 hotels, which limits its use considerably, and the value of such a free night (generally sub £100) is a small reward for such substantial expenditure.  The card has a £75 fee.

Virgin Atlantic White American Express & MasterCard – free economy to PE upgrade for spending £10,000 and a companion ticket for spending £15,000.  The high spend level required does not reflect the modest value of the rewards.  The ‘Economy to Premium Economy’ upgrade voucher on a redemption IS good but the Black card has a stronger benefit of two upgrade vouchers for spending £10,000 (and one for spending £5,000).

American Express Preferred Rewards Gold – 10,000 Membership Rewards points when you spend £15,000, paid when you next renew.  I would value the 10,000 points at £75 (assuming you transfer to airline miles and achieve 0.75p of value).  You also receive two additional Lounge Club vouchers with each renewal.  Given the £140 annual fee after the first year, your net return is low.

Emirates Skywards Elite American Express & Visafree companion ticket when you spend £10,000.  However, you need to buy a full-fare ticket to receive your companion ticket, and even then there must be reward availability on the flight.  Unless you regularly buy full-fare tickets you would not be able to benefit from this.

I am happy to hear arguments for and against my views here – many of these rewards are subjectively valued, dependant on your travel patterns.

Representative APR rates for the cards above can be found on our ‘Credit Cards Update’ page.

Disclaimer: Head for Points is a journalistic website. Nothing here should be construed as financial advice, and it is your own responsibility to ensure that any product is right for your circumstances. Recommendations are based primarily on the ability to earn miles and points and do not consider interest rates, service levels or any impact on your credit history.  By recommending credit cards on this site, I am – technically – acting as a credit broker.  Robert Burgess, trading as Head for Points, is regulated and authorised by the Financial Conduct Authority to act as a credit broker.

(Want to earn more miles and points from credit cards?  Click here to visit our dedicated ‘Credit Cards’ page or use the link in the menu bar at the top of the page.)

Bits: Avios flights from Liverpool and Newcastle, Amex Plat not dropping Accor
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Comments

  1. What's the Point says:

    Hang about……have they changed the T&Cs on when the anniversary starts!!!!

    I am sire I read somewhere that it started each calendar year????
    Taken from their website:

    Can I use my Avios Rewards credit card account to upgrade flights?
    Yes. With £7,000 of eligible spend in one year, you can upgrade either:

    two one-way flights for two people travelling at the same time and to the same destination, or
    one return journey booked on a British Airways main line service.
    British Airways codeshare flights are excluded. Flights from London City Airport are excluded. Upgrade from:

    Euro Traveller to Club Europe
    World Traveller to World Traveller Plus
    World Traveller Plus to Club World

    The year begins from the date your Avios Rewards credit card account is opened, and each subsequent year starts on that anniversary.

  2. What's the Point says:

    But then I found this text on the Avios.com website regarding the upgrade voucher….CONFUSED!

    Avios Upgrade Voucher

    You will earn one upgrade voucher if you spend a minimum of £7,000 on your Lloyds Bank Avios Rewards Credit Card in a calendar year. The £7,000 spend threshold excludes cash withdrawals, balance transfers, refunded purchases, interest, fees and other charges.

    • cheekychappie says:

      It used to be a simple 15,000 free Avios :)

      Ie free return European flight.

      Much better

    • I had it in my mind that it was by 31st Dec too, but then when I spoke to them to check how my spend was progressing against the target they said I had until the card anniversary. Annoying in a way, I don’t want to trigger the voucher too early but I’m now stuck unable to use the card until March next year, was hoping for a reset in December!

  3. Catherinexx says:

    Hi, I’ve just found this site this weekend – it’s amazing!
    I have a slightly OT question which I thought would be better here than at the bottom of one of the older articles.
    I am chasing about 40k Virgin miles and wondering which credit card you think would be best. Have I understood correctly that if I spend £450 on the Amex plat, then once I’ve spent £2000 on the card I can simply transfer the points out and cancel the card, and they will refund me 10months of fees? And I keep all the lounge/hotel status for the year?
    Can’t decide between that and the Virgin black.
    Please help out a newbie!
    Thanks!

    • Hi. Welcome! Yes, that is correct. It is a cheaper option than the Virgin Black where your card fee is a sunk cost and not refundable.

      For ongoing spending, Virgin Black is a good deal at 2 miles per £1 on the Amex – but if you only want to focus on the 40,000 for now then Amex Plat is a better overall deal. You would also get lounge access via Priority Pass for the 2 months you hold the card.

  4. What is the general advice on churning the BA PP….. I have triggered my voucher this year, and referred the wife, and we are now well on the way with her’s… plan was to keep 1 long term… but do people keep churning this card without a problem??
    If so then I will cancel mine and wait another 6 months! (I’m sure the bonus that ends in Feb will be on again shortly afterwards!!)

  5. Another one to think about is the MBNA AA card. I’ve just kept spending on it now and again since the 25k bonus offer a couple of years back and the other day I flew from HNL-HND for $6 all in, using ‘non-bonus’ miles. Still in Tokyo. CW back on Friday using open jaw 2-4-1, with the outbound trip LHR-SFO. Great use of miles for around the world trip.

  6. Can anyone answer this question on the Lloyds upgrade voucher: we now travel as a 3 so it would be great to use an Amex 241 for 2, and then a Lloyds voucher for the 3rd person. However this would have to be a T-355 type booking, if we have any chance of 3 seats. For the Amex the book-the-return-later trick is well tested. But for the Lloyds I guess I need to book & upgrade a round trip with a dummy return then hopefully change the return date: can the booking be changed like that? Bonus points: can I change the return point in the same zone if required e.g. swapping KUL for SIN?

  7. Whilst I love the Amex Platinum card and continue to pay the renewal fee, I found out the hard way that some benefits are not all they seem. For example, the claimed ‘top-tier’ membership in Avis Preferred is what they refer to as ‘invitational’ (ie unearned !) and doesn’t come with all the trimmings like free rental vouchers. This has been confirmed as correct by Avis Exec Office. Be warned.

  8. As someone else says above, 241 is great if you are a couple. As a BA traveller who typically travels and redeems alone, the pickings are really very poor indeed (and I’ve voiced this to someone senior in Exec Club in the past, who just shrugged). Wonder what the winning cards would look like if 241 was calculated at the value it represents to people like me (i.e. a bit fat zero)

    • Just an idea: have you thought about finding some random person who wants to go to the same place and sharing the cost. Not easy obviously!

      • Whenever I say I’m off to Leftpondia, loads of people ask if they can come with me, but none of them actually want to pay to go there, or travel on the dates I pick. I’m happy for them to share the cost, but they don’t get to whine about the details!

    • You can do the maths very easily as I laid out all my assumptions!

  9. cheekychappie says:

    241s are worth diddly squat to me as well – as are hotel extras. It all depends on your personal circs. Once my wife & return to our previous globe trotting status when we get our freedom & money back, everything changes, so no problem with keeping my hand in so to speak :)

    We currently have to fund 40 to 50 (Xmas/ Easter/ May half term/ summer hols; we sometimes skip Autumn half term) European flights a year to/from our European destination, though – which explains my single-minded focus on Avios.

  10. I responded this morning to Brian’s comment on 21 September on the relevance of HoF cards and vouchers and see that the discussion has advanced considerably. I guess my comments will be overlooked. Mea culpa. The perils of trying to keep up using a tablet when away. :(

    In the meantime, add me to those despairing of the BAPP card, which I’ve had since its inception, often in parallel with the plat charge card. For the first time, I’ll be letting the 2-4-1 voucher earned 2 years ago lapse and the voucher earned last year is being redeemed for travel to somewhere I don’t really want to go (just hoping better availability will turn up). This causes me to seriously question how much longer I will use the card.

    I’ll look forward to Rob’s comments on the Lloyds card, though I guess availability is likely to be an issue. Also, I still have the LloydsTSB cards and understand it is difficult to step up. Luckily, keeping options open, I still have my DC MC.