Why NO-ONE should spend £20,000 on the free British Airways American Express card

Back in April I ran an article which argued that NO-ONE should be spending £20,000 on the free British Airways American Express card to trigger the 2-4-1 voucher.

A reader dropped me a line to ask if I still believed this to be true after the annual fee for the British Airways Premium Plus card was increased from £150 to £195.

I thought this was a fair point and wanted to look at it again today.  Which is the best British Airways American Express card?

BA AmexFirst, let’s remind ourselves of the rules on each of the two BA Amex cards:

The BA American Express card has no fee, earns 1 mile per £1 spent and generates a 2-4-1 voucher each year when you spend £20,000. The voucher lasts for 1 year.

The BA Premium Plus American Express now has a £195 annual fee, earns 1.5 miles per £1 spent (3x on BA flights) and generates a 2-4-1 voucher each year when you spend £10,000. The voucher lasts for 2 years.

Why do I think that getting the 2-4-1 voucher via the free BA Amex card is a bad idea?

Well, for a start, triggering the voucher means spending £20,000 on the free BA Amex.  This leads to our first key point:

If you are spending £20,000 on the card, you’d earn 10,000 extra Avios by spending the same £20,000 on the Premium Plus card, because of the higher earnings rate of 1.5 Avios per £1 compared to 1 Avios! The Premium Plus also offers double miles when you book BA flights on the card.

Those extra 10,000 Avios alone were almost worth the £150 annual fee on the Premium Plus card.  That is no longer the case, but you can easily argue that at least half of the new £195 annual fee can be offset by the extra Avios you’d earn if you were spending £20,000.

However, that is only part of the answer.

Assuming you can manage £20,000 of American Express spend in a year, I STILL wouldn’t put it all on the BA Premium Plus card either! There are two better alternatives:

Get the Premium Plus card and just spend the necessary £10,000 on it. You can then use the additional annual spending to open more credit cards and meet the spending target required to trigger their bonuses.

or

If you have a partner, get them their own BA Premium Plus Amex and get yourself a supplementary card on that account. You could then spend £10,000 on each card (your own card, then the supplementary card on your partners account) and earn TWO 2-4-1 vouchers each year.

And there’s more ….

It is also worth remembering that the one-year expiry on the voucher on the free card is very inconvenient.  For busy routes you will want to booking 11 months in advance if possible and this is almost impossible on the free card unless you can time the triggering of the voucher to perfection.

So, taking into account:

  • The need to spend £20,000 instead of £10,000
  • The 10,000 extra Avios ‘lost’ on £20,000 of spend on the free card
  • The lost ability to use spend above £10,000 to meet sign-up bonuses on other credit cards
  • The inflexibility of just having one year to spend the 2-4-1 voucher

…. you really have to wonder if there is ANY point at all to earning a 2-4-1 voucher with the free BA Amex card!

Even with the increased fee, even if you could spend £20,000 on the free BA Amex card I think you are better off spending £195 in order to:

  • earn 10,000 additional Avios
  • get an extra year to use your 2-4-1 voucher
  • have the option of moving spend beyond the first £10,000 to a 2nd BAPP Amex or another card entirely

I am NOT saying that the free BA Amex is useless! You get a decent sign-up bonus (during a promotion) and the Avios earnings rate per £1 is not beaten by any other free card.

For someone who spends under £10,000 a year on their Amex, it is a sensible option. Anyone who spends £20,000 a year on it, though, needs to think again.

If you decide that the BA Premium Plus card is now the better choice, you have two options.  You can ring American Express and upgrade instantly (your spend to date on the free card will count towards your 2-4-1 voucher).  Alternatively, you could cancel the free BA Amex, wait six months and then apply for Premium Plus – this would allow you to pick up the 18,000 Avios sign-up bonus.

PS.  Whilst this is not something that I have ever done, some people downgrade their Premium Plus card to the free BA Amex after triggering the 2-4-1 voucher.  They receive a pro-rata refund of the annual fee for the rest of their membership year.  When they enter their new membership year, they call American Express to upgrade back to the Premium Plus card, restarting the cycle.  This keeps the annual fee below £195 per year.

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

Bits: Another Lloyds / Avios horror story, spam Avios emails doing the rounds
Bits: BA removes newspapers from inbound short haul, Etihad 10% discount code
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Comments

  1. rams1981 says:

    to book the 2 for 1 to one city and returnig from another does that need to be done on the phone?

    • i believe so

      • Scallder says:

        yep open jaws need to call – also need to call if you want to book the inbound at t-355 having booked the outbound online when that flight opened at t-355

        • rams1981 says:

          thanks guys. Scallder does that count as a change and so attract a fee?

          • Scallder says:

            I’d class it more as an addition rather than change. Regardless I’ve never been charged as I state it’s something that can’t be done on the website so have to call.

  2. flyforfun says:

    I went down to the free card over a year ago now as I knew I couldn’t use up the vouchers I had. I have the old BMI card getting 1.5 avios per £ so all my spend goes on that.

    Thinking of cancelling the free card and signing up for the PP card in 6 months+ time, but stupidly like the “member since” year on the card!! There’s no benefit to this is there? Interestingly the original Lloyds TSB card had that date on it, but when I moved over the fee paying Lloyds card it was from that year.

    Please tell me there’s no benefit from this date thing!! I need a push to cancel it!!

    • Sebastian says:

      all you need to do is to apply for another amex card as the membership start year is counted from your first card you had with them and doesn’t reset on each new card as long as you hold at least one card with them all the time. once you have another card this would display the same member since year as your current BA card. then you can cancel BA card and when re-apply after 6 months you would have the same member since year as you will be holding another card in the meantime so you will have an uninterrupted membership. I have held at least one card with them for years and my membership is counted since my first card year. hope it makes sense.

  3. I think the game is up on Avios to be honest. Why ? – read on.

    The only BA routing we would use is LHR-BKK and at around 170k Avios plus £1050 in taxes and no chauffeur (worth say £250) then you are in the hole by £1300 plus your Avios.

    Go on Etihad, which is our current usual airline on this route and you routinely get fares for £1500 including chauffeurs so £3000 for two.

    But as we are a family of 3, we don’t always know whether we can all go together on the same dates and as such, we need 2 x BAPP which is £390 now. But if you cannot generate the 170k Avios in one year, your card fees jump to 2 x £390 or £780.

    So the maths is £3000 cash cost versus £1300 cost plus £780 so £2100.

    However, if our child is on the 241 voucher then the cash fare drops by around £500 making the difference only £400 or so.

    But here is the elephant in the room. There are NO redemptions available !

    We magically got one this summer but we had to take dates which were not ideal as it was the only one we’d seen in a year of looking. We have not seen one date since and we are not restricted to state school holidays.

    Now if we downgrade, we save £780 a year and can flt when we want on better metal with “free” chauffeurs albeit at an extra cost per ticket.

    If you are generating 500k Avios a year then it might make “wasting” some on somewhat pointless 241 destinations a viable option but if you save your Avios for long haul business class then unless you know 355 days in advance and can man the phones at midnight and then get uber lucky, you are going to be either wasting Avios on other things or saving them for a day which never comes and paying £780 a year for the privilege.

    • £250 chauffeur? Where are you driving? Scotland to Heathrow? And Bangkok to Phuket??

      • £250 chauffeur? Where are you driving? Scotland to Heathrow? And Bangkok to Phuket??

        Hardly. A bog standard taxi to LHR is £60 and for 3 with luggage we’d need a minibus type at around £120 each way. Getting a late model Benz or Merc would be £120 or more each way in any case.

        I haven’t added in the destination chauffeur values.

    • I think you mean that the game is up if you want to go to BKK which you obviously do.
      We would not go if you paid us! You probably feel the same about where we want to go to which is a good thing otherwise they would be very crowded.

      • “I think you mean that the game is up if you want to go to BKK which you obviously do.”

        I only set foot in the middle east to transit, Africa is off the agenda, South America not yet on the radar and North America is like a medicine which needs to be taken a little at a time. Plus decent fares to the US are not hard to find.

        On radar are BKK, SIN, any in Oz etc. but they are almost impossible to find.

  4. Edit not £780 a year, £390 a year.

  5. I see avios and BA as a hobby… Maybe I’m lucky but 3 years in … Various 241’s, sign up bonus, telcos etc…

    LHR- PHX // JFK- LHR in F
    LHR-BKK-LHR in CW
    LHR-DXB-LHR in F
    LHR-DUB-LHR in CE
    LHR-EDI-LHR in Y
    LGW-ALC-LGW in Y

    Not forgetting the many use avios to save cash deals.
    Or the internal US flights on AA or the Asia flights on Cathay.

    Long live the avios!
    If BA made it too easy everybody would be collecting!

    • As long as i can collect avios on the cheap, as long as it keeps me amused, and as long as I can redeem them then I am in!

      I have a list of all the avios redemptions i have made, the points spent, and the equivalent cash value of the tickets. In just a few years I have had the equivalent of £40k of flights and spent £5k in fees etc and 1.2 million avios. All for flights i wanted or needed, the best being a redemption in CX First Class from HKG to LHR, although next year i have a 241 booking in First to Sydney to look forward to. Long may it continue!

    • Nate1309 says:

      I have only been collecting for a couple of years and so far have flown:
      LHR->JNB, MRU->LGW in CW (241 used)
      have booked
      LHR->SFO, LAX->LHR in CW (241 used)
      LGW->INN->LGW in ET (half term flights were £500pp and I booked 4 seats)
      So thanks many to this site I would say for a little bit of effort it is possible to turn this hobby into something very rewarding.

  6. Pretty on topic really, an article primarily about the value of a 2-4-1 voucher with comments dissecting the worth of that voucher.

  7. Pretty much the same experience for us also. Have managed to get HKG in F for 3 years in a row in Jan mind you. We are flexible with dates. Buy with the great QR sales, we have actually. Cancelled 2 x F to KUL to avail of the QR to Asia HKT and KUL.
    Many discussions around the value of time v worth of avios when these sales appeared, and we all threw in our opinions. We are doing QR from CPH and OSL in the next year. But using our 241s for CE to and from. So feel we get some value from them. Find put avios invaluable for last monute trips to Dublin also. But we do downgrade to the blue card once we have banked the 241. Plus we refer each other every year for the PP card and Plat.
    Now l have the HSBC elite we are thinking we don’t need the Plat anymore as we have baec Silver. Plus key lounge entry.

  8. I have a BA prem plus card and my wife the normal BA Amex card. I’m confused by the supplementary card option discussed. If I add my wife to have a supplementary card will she get a 241 voucher as well if she spends £10k? The BA terms said only get Avios and not a 241 voucher “2 Holders of supplementary (additional) cards to the main account holder’s British Airways American Express Credit Card account are not eligible to receive a Companion Voucher. Any amount spent on any supplementary Credit card(s) will count towards the main account holders spend target.” http://www.britishairways.com/travel/axptandc/public/en_gb

    • Sort of the problem I had. I had 2 x 241 vouchers but needed the wife to travel with child. Thus we needed to set up my other half with a card so she could use her 241 (earned in a week pushing some business spending through) but of course, no availability.

      We are now both supplementary on each others cards.

    • No. Her spend counts towards yours.

  9. Slightly off topic but i have seen on the Points Guy ( Aug 10th ) Amex is offering 50% bonus when you transfer Amex memberships reward point to BA. Has anyone else heard about this ?

    • US only I think.

    • USA only I’m afraid – not a good plan to follow American blogs when it comes to points and miles, you’ll just get jealous of their sign-up bonuses, earnings rates and transfer bonuses! 😉

  10. OT

    When you are recycling the credit cards, does the credit limit not worry you ?

    I have a 30k limit on the BAPP but I am sure if I ditched it and then reapplied later, then they wouldn’t give me anywhere near 30k.

    Not saying I need 30k but I sure need way more than 10k as I can spend that in a week sometimes on business supplies.

    Having to pay off intra month is possible of course but somewhat of a remembering task.

    • The last Amex agent told me they saw it as a negative to make more than 1 payment per month but he also suggested using a different credit card if the limit wasn’t high enough, maybe he just started there!

      • I used to just put it 10k in credit until they changed their online system to prevent this :)

        When my wife transferred from the free BA card to BAPP she retained her credit limit but any new application would not allow that porting to happen.

  11. My husband ans I have a black BA Amex of which I am a named card holder. We have already spent our £10k for our companion voucher. I also have a free Blue BA card in my name, would it be possible for me to upgrade and have my husband as named card holder under my card, with the possibility of earning another companion voucher?

    • So to clarify: your husband has a BAPP with you as a supplementary card holder. You have the BA blue. Yes you can upgrade to BAPP and then get your husband as a supplementary card holder. Might be worth looking into cancelling your husband’s card (after applying the 241) so you’ll then be able to refer him again in 6 months’ time (9k avios) and for him to get another sign up bonus (currently 18k).

  12. I have the BA Amex card and my husband also has a supplementary card . Our year end was 12 th August . We have a 2 for 1 voucher for next year . If we upgrade I suppose we don’t get the bonus 25000 avios. If my husband cancelled his card and took out the upgraded £195 card would he get the points as a new primary card holder ? It looks like the 195 annual fee card is a better offer . Could you clarify please ?

    • As a supp, your husband is ‘unimportant’ & can take out the £195 card in his own name, no problem, no need to cancel his supp card

      yes – he would get the sign up points

      you could refer him