Should you convert Clubcard, Amex, Heathrow Rewards etc points to Avios as soon as you earn them?

A reader emailed me over Christmas with a question about ‘convertible’ points.  This person was the sort who had an urge to transfer points across to Avios as soon as he earned them.  There was something psychological about the way he preferred to see his Avios balance increasing.

He realised this was not entirely logical and asked me what I thought.

This is how I see it:

In general, you should value ‘convertible’ points more highly than a point which has no other use.  It is therefore worth choosing ‘convertible’ points when given the choice, and you should keep your points unconverted for as long as possible.

There are a number of ‘convertible’ currencies you will come across.

The main ones are American Express Membership Rewards points and Tesco Clubcard points.

Heathrow Rewards points, HSBC Premier MasterCard points and most hotel scheme points are also, to a lesser or greater extent, convertible.

Amex Membership Rewards 2

1 American Express Membership Rewards point has more value than 1 Avios point, even though the former converts into the latter.  There are various reasons for this:

An Amex point will hold its value better.   If you transfer them to Avios and Avios devalues, you have lost out – you can’t convert them back.  Keeping them as Amex points means you have alternative options.

Amex or BA may decide to run a conversion bonus at some point for moving your points across to Avios.  If this happened, 1 Amex point would be worth more than 1 Avios.  (The possibility of a conversion bonus is why I NEVER recommend auto-converting Tesco points to Avios, even if you are 100% sure that is what you will spend them on.)

Amex may run a great promotion with another partner which allows you to get far more value from a point than you would get from 1 Avios.

Your personal priorities may change, and you may decide that you would prefer to redeem your Amex points for something else other than Avios.  By not converting, you retain the flexibility.

I have written on HFP before that I do not convert my Tesco Clubcard points into Avios.  We have some furniture sitting in a Safestore warehouse and Safestore accepts Clubcard vouchers at 3 x face value.  My choice is therefore to use 100 Clubcard points for either £3 off my Safestore bill or receive 240 Avios.  If I took Avios I would be valuing them at 1.25p each – and I don’t.

There is another reason why keeping Amex and Tesco points in their ‘original’ form as long as possible makes sense.  Both convert to Avios points within 24 hours of a transfer being initiated.  If a reward seat opened up and I didn’t have enough Avios, I would be confident enough to assume that the seat would still be there tomorrow morning when I could have converted points across.

Some American Express transfers are INSTANT – Virgin, Delta and Emirates – as long as you have already linked your accounts.  There is absolutely no reason whatsoever, except for a conversion bonus, why you should move points to those airlines before you need them.

Transfer timing is one reason why you may want to move across hotel points before you need them.  The last time I moved some Starwood points to an airline (Lufthansa) it took 28 days!  I was lucky that the redemption I wanted was still available.  You shouldn’t rely on a hotel scheme moving your points across to British Airways in a hurry.  If you will be totally reliant on a hotel transfer to make a redemption you have planned, you may want to move them in advance.

In general, however, if you want to maximise the value of your points then you want to maximise their flexibility.  For ‘convertible’ currencies, this means keeping them in their original form as long as possible.

(Want to earn more Avios?  Click here to visit our home page for the latest articles on earning and spending your Avios points and click here to see how to earn more Avios from current offers and promotions.)

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Comments

  1. I have BAEC, Avios and Iberia Plus balances. Do people leave them where they are and move as required or ship them to a single account when they post? Any benefit in moving them if not required immediately?

  2. Just noticed that HSBC Currency Account is now fee free, it looks like you can get cash at a very competitive rate in their branches: https://www.hsbc.co.uk/1/2/currency-account

    • Where does it say that? Looks like it’s just an account that is denominated in 14 currencies which will charge you roughly 2% to convert between them, and outside of SEPA you’ll still need to pay fees for sending money to other countries.

      By the way, this comes as standard with HSBC (and many other banks) accounts in Hong Kong, but you can actually deposit and withdraw foreign currency notes at all branches. Even so, it’s cheaper to withdraw the cash and take it to a bureau de change to convert it, then deposit it back in the bank.

  3. Chris Rasteiro says:

    Re cancelling an Amex card for a pro-rata refund – does anyone feel awkward doing this?

    • I always send a letter ( I know it’s old-fashioned but I like to avoid those awkward conversations) and they get actioned pretty promptly – my last Amex Gold got cancelled and confirmation letter received within a week.

      • The Amex team are just nice & pleasant about it, they offer such brilliant customer service it puts the rest to shame. I’m going to need to chase up a few missing Shop Small £5 statement credits today and I’m sure Amex CS will just be as nice as usual.

    • Can someone tell me how you get the pro-rata refund? Is it a cheque? Or is it a credit to your account which has to be then spent on something?

      Many thanks in advance

      • For my last three cancellations, they have sent a cheque, even though I have requested to be paid via my direct debit bank account or transfer to an existing Amex account.

    • No. You don’t even need to ask for the money – it comes anyway!

  4. Does anyone know if it’s possible to transfer from husband’s Amex account to wife’s Emirates Skywards account? Thanks

  5. Geoff tyrrell says:

    How do I convert my heathrow rewards points to avios?

  6. Great article thanks Raffles, I agree with the leaving points where they are until needed. I am in the process of accumulating 150k into my BAEC household account. I was counting on the extra Iberia shopping points to get there but having done the work on 30/12 I’m still waiting and am currently 58 points short. Any advice on the fastest transfer into BAEC/ Iberia/ Avios (ideally same day). I know Tesco are about 24 hours. TIA

  7. Timely article. We’re waiting for MR points to convert to BA Avios to book some First reward flights using a 2:4:1. Both of our accounts have only just been linked so hoping the transfer doesn’t take too long!