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

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Many of the credit card articles on Head for Points are focused on sign-up bonuses.  Get a card, spend the minimum required to trigger the bonus and potentially move on.

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.

All of these cards carry a 3% foreign exchange fee when used abroad.  If you want a dedicated credit card to use abroad, take a look at the Virgin Money Travel Credit Card (click here).  This card is free and charges NO foreign exchange fees.  It also offers 0% interest on purchases for 12 months and 0% interest on balance transfers for 12 months, with no fee.  Representative APR 21.9% variable.

(EDIT:  This article was updated on 1st December 2019 and all of the information was 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.

Excluding the Virgin credit cards, 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

Your return on 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

Your return on the £160 Virgin Money Reward+ card also varies by status:

  • Base Virgin Flying Club member – up to 3.3% on first £10,000
  • Silver Virgin Flying Club member – up to 5.1% on first £10,000
  • Gold Virgin Flying Club member – up to 11.4% on first £10,000

I will explain the basis of my calculations below.  The BA and Virgin calculations are based on using the 241 voucher for San Francisco or a flight of similar length.

Our base comparison –  The John Lewis / Waitrose Partnership 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 shopping vouchers.

Representative APR 18.9% 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 two Avios redemption tickets (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 voucher 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 earn 15,000 miles for spending £20,000, valued at £112.50. The card itself is free.

The low end valuation is a base member using the upgrade voucher: £187.50 value from the voucher plus £112.50 of value from miles earned, total £300 back on £20,000 of spending.  This is a return of 1.5%.

The high end valuation is a Gold member using the 2-4-1 voucher in Upper Class, assuming a flight to San Francisco:  £1162 value from the voucher plus £112.50 of value from miles earned, total £1273 back on £20,000 of spending.  This is a return of 6.4%.

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)

The maths is the same as with my analysis of the free card.  With a 2-4-1 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 £10,000, valued at £112.50. 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 £112.50 of value from miles earned, total £300 back on £10,000 of spending, less the £160 fee.

The high end valuation is a Gold member using the 2-4-1 voucher for Upper Class, assuming a flight to San Francisco:  £1162 value from the voucher plus £112.50 of value from miles earned, total £1274 back on £10,000 of spending, less the £160 fee.

This means the net benefit for spending £10,000 = between £140 and £1114, or 1.4% to 11.1% 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 45.1% 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 Marriott Bonvoy Gold status for spending £15,000 and a free night voucher for spending £25,000.  Marriott Bonvoy 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 also feel that the Lufthansa Miles & More Diners Club and Mastercard package deserves a mention.  Whilst there is no long-term spend bonus, the day-to-day earning rate of 1.25 miles per £1 is very strong.  You need to be a high spender to maximise value due to the £79 annual fee, although the 10,000 mile sign-up bonus offsets much of it in the first year.

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.)

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Comments

  1. Regarding the IHG premium card: do you effectively have to pay the annual fee twice for the voucher? I have hit the target already in my first year but I won’t receive the voucher until the card anniversary so I can only imagine I will be paying the £99 for the second time for 1 voucher.

  2. To enjoy the full benefits of triggering the 2 for 1 voucher it looks like you would need 150,000 avios. Something that I’m nowhere near achieving. A cheap return economy flight to Australia only racks up 6000 avios. A lot of flying and spending is required to get to the 150,000 mark.

    • Nick not true.

      Churning hitting bonus targets & referring goes a long way.

    • Those were my first thoughts when I first took up the hobby 3 years ago. The trick is churning and referring others. If you have a partner then it’s even easier as you can keep referring each other for the various credit cards. After slowing down in the last year, we are sitting on about 200k Avios and that’s after redeeming 241 Club Business from LHR to Vegas. We average about 3 journeys a year and only one of those is usually long haul.

    • Don’t book cheap economy flights.

    • Tom Cook says:

      We started this hobby 2 1/2 years ago and thought that accumulating points would be tough. However once you get going it starts to pick up quickly. We currently manage to generate a minimum of 150k avios each year easily, which last year meant CE flights to Italy, Mykonos, J out & F return to NYC – like everyone says this is through referrals (had 54k in the first two months of 2019 alone), churns, Tesco CC conversions etc. Also you need to ensure that you do use the BA site to generate more avios! We got 7000 avios from Selfridges for the Mrs’s birthday present recently!

      • About 2-3 years ago someone (Rob?) made a comment on here that 100,000 avios per annum ought to be within most people’s reach. I replied that I didn’t agree as my credit card spend was not enough to which I got a reply telling me to stop being a spectator and to put some effort in! Since then that’s exactly what I have done and have averaged well over 150,000 points per annum. The BA shopping portal has been a massive help, not just Hotel Chocolat but I have had some massive payouts from Booking.com.

  3. Nigel the Pensioner says:

    Just what I was going to pint out, Nick, You DO have to pay fully in Avios for the 2 for 1 voucher to be valid so you face a few years of wasted vouchers at low to medium spend. You will also need to put those Shell and Tesco vouchers into the pot to start to build up some “capital”. Of course you still have to pay the taxes “and charges”! But……as all readers of more than a few months know, it can be done!

  4. Rob – have Virgin request you disable comments on the Tel Aviv article?

    Should we comment here instead?

    56k for a RTN in UC will get snapped up pretty quickly.

    Do you know if VS have any further plans for new FlyBE routes like INV-LHR?

    • I think they might be worried about comments by the, ahem, Corbyn brigade.

    • You think INV can take more capacity? I thought there was already BA twice daily most days and about 3-4 easy jet? Very impressive, any idea what the split is between locals and tourists on these flights?

  5. OT Curve card: Just have the basic card. Can I withdraw only £200/month or is it now 10x £200/month? Do ATM withdrawals count towards total annual spend or are the ATM limits separate from the spending limits?

    • Cash withdrawals do not count towards spend limits. Not sure on the official line on ATM these days, ie whether FUP is still is operation. De facto, however, charges will not automatically be charged so do as much as you feel comfortable with bearing in mind that the amount of withdrawals is monitored.

      • Thanks Genghis, I have never really used Curve to its full potential although it did trigger my Lloyds voucher for me almost by itself in December. I will not go overboard with it but will use it to tidy up balances on IHG, Hilton and Virgin to rounder numbers. That in itself sounds silly while earning regularly but I get frustrated if my points and miles balances are sitting there a few 10s, 100s or 1000s below X000 or X0000 useful for redemptions.

    • Has there been any update on the Curve/Amex debacle?

      • Nope, nothing. Guessing it’s over in the legal dept. But I’m not sure why, they were told they were not going to allow it, so went ahead and launched it. Guess they are trying to challenge where CC operators should be open. In the meantime, Curve CEO looks like he had a nice time at the Brit Awards with Mastercard 🙂

  6. Jonathan says:

    My understanding of the Virgin money rewards + mastercard is that the 241 voucher can NOW be used in the same way that the BA voucher is used . EG if I book an upper class return with Virgin miles my voucher can be used in the same cabin regardless of what level of membership I have .
    So base members now enjoy the same upgrade as a gold member .Apparently Virgin changed this to match the BA 241 voucher quite recently.

    Is that correct or am I misinformed ?

    • New Card says:

      First I’ve heard of it but would be a game changer if true.

      • Misinformed, unless everyone I know at FC decided not to tell me. Which, for legal card marketing reasons, would have been a bit of a mess up on their part.

    • Haven’t personally heard that and imagine it would have been referenced n in all the usual places if that was the case. Would love to be wrong!

    • I believe you have been mis-informed

    • Where did you hear that? Would be great if so but suspect we would have heard about it…

    • Jonathan – whats the evidence/source of your (likely) misinformation?

      Got a weblink to something in black & white?

      • Jonathan says:

        I had called virgin and was definitely misinformed by the guy who fielded my call . After reading today’s replies I rang flying club again and was put right . Unfortunately the virgin 241 voucher will have a limited use for me as a base member and I’ll probably go back to collecting Avios.

  7. Nick Burch says:

    And for those of us lucky enough to put loads of business spend through our personal cards… Once you’ve hit the long term spending bonus on all the cards you have / are willing to churn, what then?

    I think it’s probably BA Premium Amex for places that take Amex, and Virgin for the rest?

    • Amex Gold/Platinum is another good option rather than stacking up too many Virgin/Avios points that you may not use, ie over a million of each

      That said the BA Premium card earning 1.5 points may net you 0.75p when using against hotel redemptions so that is a fair return incase you can’t use the Avios and the virgin card has a similar value if cashed out to a virgin gift card

    • The Savage Squirrel says:

      I’ve always assumed as a sole trader that cash back would count as part of my profit/loss calculation and is therefore taxable? 40/50% tax on that cash back makes points look a lot more attractive?

      • Sussex Bantam says:

        Yes – that’s true.

        I’m not a sole trader though just putting my company travel expenses through a personal credit card.

        (Not sure how you are paying 40% tax on the cash back though ? )

      • @Sussex Bantam.
        As an individual, I buy a new TV for £100 out of my already taxed money and I receive cash back / cash back on credit credit of £1, the net is £99.
        As a sole trader / company, I buy a new TV (for work purposes) for £100 using monies not yet taxed and I receive cash back / cash back on a credit card of £1, the net is £99. For accounting purposes, you can’t put through £100 as an expense, but £99. The effect being that the cash back does get taxed at your marginal tax rate (40% / 45% for sole trader / relevant CT rate if Ltd co).

      • Sussex Bantam says:

        Yes, yes – sorry. Missed the sole trader versus limited company point in OP’s comments.

  8. No mention of the Diners/MC Miles&More combination?

    An OK earning rate of 1.25 miles per £ with some annoying characteristics – who takes DC? The MC is not a real credit card and can’t be used everywhere.

  9. Shouldn’t your Virgin Flying club mile value not alter to 1.5 mile valuation when mentioning the Virgin Atlantic+ card; both seem to refer to 0.75 in the ‘honourable mention’ sections?

  10. Memesweeper says:

    For medium/high spenders you may pass the £10k threshold and need to ‘move on’ to another card. And many of us have high non-Amex spend, so need to look across a few cards. In my case my long term spend plan is for
    – BAEC Premium Plus
    – Amex Gold (although it’s the business version and I’m now not sure that qualifies for the 10k spend benefit!)
    – IHG Premium
    – HSBC Prem

    … Virgin keep turning me down. 🙁 Harder to get their cards than HSBC Premier.

    In terms of valuations:
    – a 2-4-1 isn’t worth double the points for a redemption as it’s significantly less flexible/useful than double the points IMO
    – New York is a more typical redemption for both Virgin and BA than San Fran

  11. Might be worth mentioning that if you spend £37.5k (minus any status points earned from stays) on the IHG Premium card you get Spire Elite status and therefore 25,000 bonus IHG points.

    I am planning to do this on Mrs W’s card this calendar year. Her card anniversary is July so will also earn 2x free night certificates in that time.

    • Agree Spire via IHG is an excellent option – plus higher earnings bonus on any IHG stays.

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