With the sign-up bonus on the British Airways American Express Premium Plus (BAPP) card increased to 25,000 Avios until February, I thought it was worth taking another look at why I rate this card for long term spending. I have a BAPP and my wife has her own too.
This is especially important given the recent fee hike to £195 per year which may have made you reconsider the value you get from the card.
(I am obliged to remind you that the British Airways American Express Premium Plus card has a representative APR of 76.0% variable based on a £1,200 credit limit. The free British Airways American Express card has a representative APR of 22.9% variable.)
A lot of the credit card posts on Head for Points are focussed on sign-up bonuses. Get a card, spend the minimum required to trigger the bonus, cancel the card, move on.
That works fine for some people. 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.
Many credit card issuers offer 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 and can be more valuable than the sign-up bonus, especially as you can earn them year after year.
Here are the key cards which offer annual benefits for spending a large sum:
British Airways American Express Premium Plus – 2-4-1 voucher on Avios redemptions for spending £10,000
British Airways American Express – 2-4-1 voucher on Avios redemptions for spending £20,000
American Express Preferred Rewards Gold – 10,000 Membership Rewards points for spending £15,000
Lloyds Avios Rewards American Express & Visa – upgrade voucher for spending £7,000
Virgin Atlantic Black American Express & Visa – upgrade vouchers at £5,000 and £10,000
IHG Rewards Club Premium MasterCard – free night voucher for spending £10,000
Hilton HHonors Platinum Visa – Hilton HHonors Gold status for spending £10,000
Starwood Preferred Guest American Express – free night voucher for spending £25,000
By a substantial margin, the most valuable of these is the 2-4-1 voucher offered on the British Airways American Express Premium Plus.
A potential 10% return on your spending
When you spend £10,000 on the BAPP card, you get a voucher which gives you two Avios redemptions (on BA planes, ex-UK only) for the miles of one. You still need to pay the full taxes and charges on both tickets, however.
On an average redemption (two Club World tickets to San Francisco on a peak day, say), this saves you 150,000 Avios points. On a First Class flight or a longer Club World trip, the saving could easily exceed 200,000 Avios.
I have a very conservative valuation of Avios points of 0.75p. Most readers value them more highly. However, even at 0.75p, the 2-4-1 voucher is ‘worth’ £1,100 if it saves you 150,000 Avios points on a trip.
£1,100 of value for spending £10,000 on the card is an excellent return. Even when you factor in the £195 annual fee, you are still getting a £900 net return on your £10,000 of spending.
Why I prefer the Premium Plus card to the free British Airways American Express
As I wrote in this article, I am NOT a fan of the free British Airways American Express card if you plan to earn the 2-4-1 voucher.
This is the despite the fact that you would save £195 in annual fee by taking out the free BA card instead of the Premium Plus.
Why is this?
The 2-4-1 voucher on the BAPP card lasts for two years, whilst the voucher on the free card only lasts for one year. This is very important since, on busy routes, you may need to book 11 months ahead to guarantee the seats you want.
You earn an extra 0.5 Avios per £1 spent, which outweighs some of the £195 fee
You only need to spend £10,000 and not £20,000 to trigger the voucher. Even if you can easily do £20,000 of American Express spending per year, it would make more sense to get a 2nd Premium Plus card for your partner and put £10,000 through that as well – so you generate 2 x 241 vouchers each year, each valid for two years – rather than put £20,000 through the free card.
My full review of the British Airways American Express Premium Plus can be found here. The official Amex website and application form is here. The higher sign-up bonus of 25,000 Avios is available until February 2017.
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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.