Got the free BA Amex card? Learn how to reduce your £20k 2-4-1 target to £10k and why you should drop it entirely

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We ran an article yesterday to explain how American Express treats refunds made to your card.  As I pointed out, a refund counts against your annual spend if you are trying to earn an annual bonus.

In my case, for example, the £2,000 refund I am due from British Airways on my British Airways American Express Premium Plus card means that I will now need to spend £12,000 this year – not £10,000 – to trigger my next 2-4-1 voucher.

At the bottom of that article, I suggested that holders of the free British Airways American Express card should upgrade – if only temporarily – to the Premium Plus card if they are worried about triggering their 2-4-1 voucher.

Here was my logic:

many holders of the free British Airways American Express card will struggle, under lockdown, to spend £20,000 this year to trigger their 2-4-1 Avios companion voucher

upgrading to the Premium Plus card only costs £16.25 per month in fees (£195 / 12) as the fee is refundable pro-rata

because the Premium Plus card only requires £10,000 of annual spend to trigger your 2-4-1 voucher, once you have upgraded you will either:

trigger your 2-4-1 immediately, if you have already spent £10,000+ on your free British Airways American Express, allowing you to downgrade again quickly, or

trigger your 2-4-1 as soon as you pass £10,000, allowing you to downgrade again at that point

Either way, it is an easy solution if you are worried about missing out on your next voucher.  It doesn’t seem, at the moment, that any support will be forthcoming from American Express or British Airways in terms of reducing spend targets.  You can’t be blamed for taking matters into your own hands.

There is no formal upgrade process.  You simply apply online for the BA Premium Plus card here.  Your existing free BA Amex is automatically cancelled and your existing membership year and spending to date target is carried over.  You don’t qualify for the 25,000 Avios sign-up bonus on the Premium Plus card as an upgrader.

You can downgrade to the free card again as soon as you have your 2-4-1 voucher in your Executive Club account.  The annual fee on Premium Plus is refunded pro-rata, so your net cost is only £16.25 (£195/12) per month.

Don't get the free British Airways American Express card

You shouldn’t have the free British Airways card anyway ……

I know that a lot of Head for Points readers have the free British Airways American Express card, hence my advice above.

However, you really shouldn’t.

If you have this card, this is why I think you should switch.  The reasoning depends on whether you spend £20,000 to trigger the 2-4-1 companion voucher or not.

Scenario 1:  ‘Yes, I do spend £20,000 per year on my free British Airways American Express card’

For a high spender, the free British Airways American Express card makes no sense.  If you could spend £20,000 on the free BA Amex card to trigger the 2-4-1, I think you are better off spending £195 to get the Premium Plus card instead.  This is because:

The 241 voucher is only valid for one year on the free BA Amex, instead of two years for the BA Premium Plus voucher.  The one year expiry on the free card is a major issue if you want to book seats 355 days in advance as it is virtually impossible to time your voucher issuance so neatly.

The £10,000 of ‘extra’ spending required to trigger the voucher on the free card (£20,000 compared to £10,000 on the Premium Plus card) could be directed elsewhere triggering sign-up bonuses on other cards.  You could also get a Premium Plus card for your partner and put your ‘spare’ £10,000 of spending on that, earning a 2nd 2-4-1 voucher in your household each year.

You earn an extra 0.5 Avios per £1 spent (1.5 Avios per £1) which offsets much of the £195 annual fee on the Premium Plus card.  £20,000 on the paid card would earn you 30,000 Avios vs 20,000 Avios on the free card.  If you value an Avios at 1p, this is £100 of value you get back immediately.

If you spend £20,000 on the free British Airways American Express card, you shouldn’t.

Amex Rewards Credit Card

Scenario 2: ‘No, I don’t spend £20,000 per year on my free British Airways American Express card’

Sorry, but I think you are potentially making a mistake too.

I know that a lot of people don’t spend large amounts on their free BA Amex card.  They don’t trigger the 2-4-1 companion voucher BUT they like earning 1 Avios for every £1 they spend.

Someone spending at least £10,000 per year should upgrade to the Premium Plus Amex card.

If you spend under £10,000 per year, you are better off with the lesser-known American Express Rewards Credit Card pictured above.

The American Express Rewards Credit Card is a standard Amex-branded credit card.  It has no annual fee and no substantial benefits, except for the ability to collect Membership Rewards points at 1 point per £1 spent.  You can find full details here – it has a representative APR of 22.9% variable.

You will not get the sign-up bonus if you have had a Gold or Platinum American Express card – or any other Amex card which gives Membership Rewards points – in the last 24 months.  You can still apply for the card, however.

Why is the Amex Rewards Credit Card better than the free BA Amex card for low spenders?

Here’s the interesting bit:

The free British Airways American Express card earns 1 Avios per £1 spent

The free Amex Rewards Credit Card earns 1 Membership Rewards point per £1 spent.  These transfer 1:1 into Avios points if that is what you choose to do.

What you get with the American Express Rewards Credit Card is flexibility.  Yes, you can use your points for Avios.  You can send them over to British Airways via the Membership Rewards website and they will arrive within 48 hours, often 24 hours.

However, you have other options.  Membership Rewards points can also be sent to Virgin Atlantic, Flying Blue, Emirates, Etihad and Delta among other airline partners.  You can also send them to Hilton Honors (1:2), Marriott Bonvoy (2:3) and Radisson Rewards (1:3).  You can convert them to Club Eurostar (15:1).  You can even use them for shopping vouchers.  You can see the airline partners here.

You have more choice.  You can still take Avios if you want, and at the same 1 Avios per £1 earning rate.  If you suddenly decide that you want hotel points, or that Virgin Atlantic miles make more sense, or even that you want to abandon Avios altogether, you can.  Simply move your Amex points somewhere else instead.

With the free BA Amex card, your points are sitting in Avios from Day 1 and you can’t do anything else with them.  If Avios devalues its rewards, if BA stops flying your preferred route, if reward availability suddenly gets a lot harder to find, if Reward Flight Saver fees jump up, if new surcharges get added, if BA fails to survive coronavirus ….. you’re stuck.

The only good reason NOT to drop your free BA Amex is that having the Amex Rewards Credit Card means that you cannot get a sign-up bonus on an Amex Gold or Amex Platinum card afterwards.  On the other hand, once you have gone two years without the free British Airways American Express, you would be able to apply for the British Airways Premium Plus card and receive the sign-up bonus of 25,000 Avios.

(I know that the sign-up rules for American Express cards are now hugely complex.  This HFP articles explains, step by step, which American Express cards you can still get a bonus on, based on the cards you have.)

Conclusion

If you have the free British Airways American Express credit card, and are struggling to hit your £20,000 annual spending target due to lockdown, you should think about quickly upgrading and downgrading to the Premium Plus card.

This will trigger your voucher as soon as your spending passes £10,000 in your current card year.

Longer term, stop and think about why you have the free BA Amex card.

If you are spending more than £10,000 on the free card, the Premium Plus version offers you a better deal.  If you are spending less than £10,000, the American Express Rewards Credit Card offers all of the same benefits (no fee, the equivalent of 1 Avios per £1) with a lot more flexibility.

(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.)

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 financial products 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.

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Comments

  1. Secret Squirrel says:

    Yes, but there has been reports if you upgrade now after you have already spent over 10k that you may be issued a 1 x Year voucher instead of the BAPP 2 x Year voucher. You will need to call Amex if they issued you a 1 x year version and wait to be resolved.

  2. GeoffGeoff says:

    I really can’t see Amex liking people repeatedly upgrading and downgrading cards to avoid fees. At some point they will either block individuals (e.g. refuse new card applications) or change the process for everyone. I know there is a fine line between legitimately exploiting the rules and taking the p, but repeatedly up / down grading seems more like the latter to me.

    • Yes, it is. However, in the current circumstances with very little discretionary spending, I’m sure this is preferable to Amex than the cardholder walking away entirely.

    • This will soon go the way of the “mass churning” another one bites the dust!

    • Frenske says:

      On the other hand, AmEx has saved over 5000 Avios by not pay 1.5 Avios/£1 but only 1 Avios/£1. Plus the thousands bonus Avios on BA spend. Still not near the £195 fee.

  3. Speaking of credit cards…

    The earlier article mentioned credit card companies were holding back payments to airlines until after a flight was taken, to cover potential s75 claims.

    I presume this is also the case for airline-cancelled flights?

    Does this not have a massive impact on the airlines’ ability to provide cash refunds at the moment, add they won’t have had the cash anyway?

    • I think they can use the held funds to refund.

      • Exactly. They will tell Amex to reverse a certain transaction, and as Amex never handed over the cash in the first place they won’t take any more from the airline.

        Doesn’t explain why Virgin wants 100 days to pay a refund though!

        • That makes sense, thanks.

          I’m guessing there’s no integration between the BA and AmEx systems, though, so likely to be manual intervention to produce export files to interface between the two, with transmission over secure protocols – hence, with current volumes, the lengthy delays in processing

  4. OT – I used by BA 2-4-1 Voucher to book a multi city flight from LHR > JFK and back from Toronto to LHR – In Club World.

    Having reviewed the confirmation, the BA staff member seems to have made an error. The confirmation states:

    Voucher Type – Gold Upgrade Voucher (I’m Bronze currently)
    It makes no mention of Avios being used although my account has been debited and my voucher gone.
    The Payment Total is higher than i was expecting (£1,100 vs £1360 charged)

    Part of me is wondering if i should just leave as is in the hope that the system see’s this as a premium economy flight with a gold upgrade voucher? Might get TP’s!

    I would let the £260 fare difference slide if i thought i’d get TP’s for it instead of nothing.

    Any thoughts/input/ suggestions?

    • BA has hiked the taxes/fees since this all started, don’t know if that’s making a difference? US East coast is now not far off £700 pp in BA surcharges.

      • Lady London says:

        This is precisely the risk of taking a voucher from BA instead of insisting on getting a cash refund. BA cannot deny you a cash refund if they cancelled your flight.

        If you take a voucher there’s a huge chance it won’t cover the future price of the same travel. Whether that be a cash price or an avios+’taxes’ price.

    • The taxes seem correct 662.67 x 2 when I pulled it up. If they don’t debit the Avios and you have a ticket # / seats assigned, then I would definitely just leave it….

    • I redeemed a companion voucher last year, travelling end of October. I seem to recall the email used the same wording of Gold Upgrade Voucher

    • GeoffGeoff says:

      They often state the wrong voucher type on the confirmation, and it seems to have no consequences at all.

  5. Reckoned what Secret Squirrel said there. Happened to me personally as I had a blue card and spent almost 20k somehow without reading this type of info on HFP. Upgraded to BAPP but then my 2-4-1 voucher was issued with only 1 year validation. It was a nightmare trying to sort that out with AMEX as it seems once they advised BA loyalty team to issue the voucher — they will never gonna speak to them again! Hence you have to do all the work yourself. Advice: upgrade before you reach 10k spend.

    • Last year I listened to those who said apply for a Black card and your Blue one will upgrade ‘automatically’. My application got rejected.

      I phoned AMEX and they told me not to do this again. If you want to upgrade/downgrade, just ring. They are aware of how to do the upgrade/downgrade and the process is very smooth and friendly.

      Because of these delays, I accidentally hit a 10K spending target while in transition from Blue to Black card, but it didn’t prevent me from getting a 2-yr (now 2.5-yr) voucher

  6. Are you eligible for the sign-up bonus to the free AMEX rewards card if you’ve had the free BA AMEX?

  7. Gareth says:

    This is interesting, I’m hopefully going to get £26000, in refunds from cancelled cruises before the end of my year in mid September. I’ve already used the 241 voucher I earned in October in good faith, but I won’t spend £36000 on my BA premium Amex this year given spending has almost stopped with lock down. What happens

  8. Kenneth Malcolm says:

    I have £9600 spending on my blue card are you saying I can upgrade to the premium plus and this spending will be carried over to my new card and then if I spend another 400 by 25th July (the end of my current blue card year) I will be eligible for the 2 for 1 voucher? also can I refer myself for this premium card to earn some more Avois?

    • Correct.

      I strongly recommend you do it BEFORE you hit £10,000 as you will be issued a two-year voucher. If you upgrade after you’ve hit £10,000, you sometimes – in error- get immediately issued with a one-year voucher and you need to start email ping-pong with Amex to get it adjusted to 2 years.

      No referral bonuses are paid on upgrades.

      • Kenneth Malcolm says:

        so I am better to upgrade over the phone now rather than apply via a referral link?

        • Makes no difference but you’re wasting your time using a referral link. Just use the standard Amex website.

          • Michele says:

            Thanks Rob, I upgraded on line and worked a treat. I now have a BAPP and my spend of £9900 was carried over so I just need to spend £100 for the 241 voucher 0 hurrah. Really appreciate the heads up about upgrading. I will wait until I get the 241 voucher then go back to the free card I think. Although I do have 2 flights booked on BA one to Charleston and one to Nice this year so I need to think of the extra Avios with BAPP. Will have a think unless you have advice 🙂 thanks again

    • Secret Squirrel says:

      Kenneth: Yes, just make sure you upgrade to BAPP before spending 10k to get the 2 x Year voucher.
      Would not recommend self referral as Amex U.S have been clamping down on this potentially closing accounts or clawing back referral points.
      Just get a partner or friend to refer you, better to keep a good, long standing relationship with Amex than a ban! 😉

  9. Simon jones says:

    Hi I have the BA premium plus card. I reached my 10k spend in March and the voucher was issued straight away and shows on my BA account

    My progress bar on Amex account said I had earned the voucher for this year.

    A couple of days ago I received a refund from some cancelled flights. This has now changed my status bar on my Amex account to say I need to now spend xxx to get my voucher

    I have already got it, does that mean Amex will take the issued voucher back or not

    Can anyone help ?

    • They won’t take it back
      The counter is just their ongoing system, and you won’t get another voucher.

  10. Nick G says:

    My wife and I both have the free BA Amex as well as good credit cards. We rarely use the BA cards anyway. However my question is …. Is there any point at all in having a free BA card?

    Never really thought about it before just kept them running in the background as a back up when I use avios to buy tickets on Qatar. Because we churn cards the issue I’ve found is Qatar want to see the card used to book the tickets usually. We could never gaurantee the churned cards would be around hence the trusty BA cards.

    • TGLoyalty says:

      Really is no use keeping them. Infact they’ve stopped you resetting the BAPP welcome bonus clock.

      In my experience Qatar only wanted to see the card they didn’t actually do anything with it. Just keep the card you used instead of cutting it up?

    • Doug M says:

      I believe it’s good credit practice to keep one credit card long term, something like your banks basic free card will serve that purpose. I certainly wouldn’t keep the BA Amex for that, as TGL says you’re not resetting the clock if you decided you did want the BAPP and the 25K welcome bonus.

  11. Renaud says:

    I’m considering downgrading my BAPP to save the £195 as my spending is really low at the moment, then upgrading again after lockdown (at the latest before hitting £10000)

    My BAPP resets in early February, only £600 spend so far.
    I have two 241s already with just 250K avios, one expiring April 2021 the other July 2022.
    My partner also has at least another 241

    Is there any reason not to do it in these circumstances? I guess I could just book a flight for next year to use the 1st 241 and get double Avios on the taxes spend, and yes I’d get an extra 5000 avios on the 10K spend, but that’s about it. Don’t think it’s worth 195 is it ? It could take me a while to reach 10K in the current climate: better to do that on a free card, right ?

    I also have an Amex gold that I’m planning to switch to ARCC soon, because the benefits are useless right now.

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