What are the best bonuses for LONG TERM card spending?

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Many of the credit card posts on Head for Points are focused on sign-up bonuses.  Get a card, spend the minimum required to trigger the bonus, cancel the card, move on.  After a period, you can re-apply for the first card you got and claim the bonus again.

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

(EDIT: This article was updated on 1st September 2018 and all of the information is correct as of that date.)

What are the best UK credit and charge card bonuses for long term spending?

Many 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.

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:

  • British Airways American Express Premium Plus – 10.1% back on first £10,000
  • British Airways American Express (free version) – 6.1% back on first £20,000
  • IHG Rewards Club Premium Mastercard – 2.3% back on first £10,000
  • Generic cashback Visa or Mastercard – 0.5% back, usually in vouchers

The free Virgin Money Reward card varies by status:

  • Base Virgin Flying Club member – up to 2.4% on first £20,000
  • Silver Virgin Flying Club member – up to 3.4% on first £20,000
  • Gold Virgin Flying Club member – up to 6.4% on first £20,000

The £160 Virgin Money Reward+ card also varies by status:

  • Base Virgin Flying Club member – up to 4.4% on first £10,000
  • Silver Virgin Flying Club member – up to 6.3% on first £10,000
  • Gold Virgin Flying Club member – up to 12.3% on first £10,000

I will explain the basis of my calculations below.

Our base comparison –  The Amazon Platinum Card or similar

This is typical of the best free Visa or Mastercard cashback cards currently available, giving you 0.5% of your general spending back in the form of Amazon vouchers.  You will get a similar return from the John Lewis / Waitrose card.

Representative APR 19.9% variable.

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), this saves you 150,000 Avios points!

Based on my very conservative 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.

Representative APR 76.0% variable including £195 fee based on a notional £1200 credit limit Interest rate on purchases 22.9% variable.

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.

Representative APR 22.9% variable.

Honourable mention, airline category Virgin Money Reward Mastercard 

The new Virgin credit cards are very hard to value because you have a choice of rewards which are determined by your Virgin Flying Club status.

Spend £20,000 on this card and you can get:

A 2-4-1 voucher, valid for two years, for a Virgin Flying Club redemption in Economy (base members), Premium (Silver members) or Upper Class (Gold members) or

A return upgrade to Premium when you book an Economy reward flight (requires reward availability in Premium)

Let’s assume you use the 2-4-1 to fly to San Francisco on a peak day.  A base member redeeming in Economy will save 50,000 miles; a Silver member redeeming in Premium will save 75,000 miles and a Gold member redeeming in Upper Class will save 155,000 miles.

Someone using the upgrade voucher to redeem in Premium rather than Economy will save 25,000 miles.

Based on my very conservative 0.75p per Virgin Flying Club mile valuation, the 2-4-1 voucher is ‘worth’ between £375 and £1162.  The upgrade voucher would be worth £187.50.  You would also 15,000 miles for spending £20,000, valued at £112.50. The card itself is free.

This means the net benefit for spending £20,000 = between £300 and £1228, or 1.5% to 6.4% of spend.

Representative APR 22.9% variable.

Virgin Reward Plus credit card

Honourable mention, airline category Virgin Money Reward+ Mastercard 

This card is equally hard to value.  Spend £10,000 on this card, which has a £160 fee, and you can get:

A 2-4-1 voucher, valid for two years, for a Virgin Flying Club redemption in Economy (base members), Premium (Silver members) or Upper Class (Gold members) or

A return upgrade to Premium when you book an Economy reward flight (requires reward availability in Premium)

Let’s assume you use the 2-4-1 to fly to San Francisco on a peak day.  A base member redeeming in Economy will save 50,000 miles; a Silver member redeeming in Premium will save 75,000 miles and a Gold member redeeming in Upper Class will save 155,000 miles.

Someone using the upgrade voucher to redeem in Premium rather than Economy will save 25,000 miles.

Based on my very conservative 0.75p per Virgin Flying Club mile valuation, the 2-4-1 voucher is ‘worth’ between £375 and £1162.  The upgrade voucher would be worth £187.50.  You would also 30,000 miles for spending £20,000, valued at £225. The card has a £160 annual fee.

The low end valuation is a base member using the upgrade voucher: £187.50 value from the voucher plus £225 of value from miles earned, total £387.50 back on £10,000 of spending, less the £160 fee.

The high end valuation is a Gold member using the 2-4-1 voucher:  £1162 value from the voucher plus £225 of value from miles earned, total £1387 back on £10,000 of spending, less the £160 fee.

This means the net benefit for spending £10,000 = between £252 and £1227, or 2.5% to 12.3% of spend.

Representative APR 63.9% variable including £160 fee based on a notional £1200 credit limit.  Interest rate on purchases 22.9% variable.

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.

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.

Representative APR 41.5% variable including fee based on a notional £1200 credit limit.

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 / Marriott Gold status for spending £15,000 and a free night voucher for spending £25,000.  SPG / Marriott Gold has only modest benefits and is often available for free, eg as an Amex Platinum benefit.  The free night is valid only at hotels costing up to 25,000 points, which limits its use considerably, and the value of such a free night (generally around £100) is a small reward for such substantial expenditure.  The card has a £75 fee.

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.

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

(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.)

LOTS of American Airlines (very comfy) business class seats between London and the US for Avios
Bits: 2400 Avios with LEGO Technic, Singapore brings new First to London, 100 free Shangri-La points
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Comments

  1. Donald Trump says:

    Assuming that AMEX did change to a 2 year rule, i think my strategy would be to:
    1- Get the BAPP to get the CV and then cancel and repeat the following year
    2 – Keep the SPG card as my main card for long term spend (mainly for the marriott vacation packages) and use for referrals
    3 – Churn the Platinum card every 2 years

    • If thought you needed to keep the BAPP or BA Blue (free) otherwise you lose the CV? If you downgrade to the BA Blue (free) so as not to pay the BAPP fee, the clock’s still not reset and you can’t get any sign-up bonus to the BAPP, right?

      Or am I wrong?

  2. Another long term bonus of the IHG Premium card is you would get Spire Elite status after £37.5k spend (less if you have elite qualifying points from stays, virgin transfer etc) which comes with 25000 bonus points for reaching spire. This is effectively an extra point per £ spent between 10k and 37.5k, i.e. 3 points per £ total. For a couple with lots of non-Amex spend, doable if you have tax bills etc.

    • True. It is effectively 100k IHG (£400 worth on my calcs) for £37500 of spend, plus the free night for hitting £10k. Although some may prefer to get their partner a card for another £95 and put £10k on that for a 2nd free night.

  3. I’ve upgraded my AmEx Gold to Platinum 2 months ago during the first ‘ Fee free’ year on the Gold , but so far haven’t been charged the Platinum £450. Is this normal, when can I expect the fee?

  4. Terry S says:

    AS Andy R above says……
    I’ve spent about £7500 this year in BA holidays (in the sale) and BA flights ‘from Dublin’ in order for us to keep Silver. If they change the BAPP rules I’ll go to another airline. So as others mention why would you risk losing these customers…..so they’ll probably will do it!!

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