One week left: Should you buy Membership Rewards points whilst you still can?

The end of the next week sees a major change to American Express cards – the end of pro-rata fee refunds. We will look at this again in more detail tomorrow.

Today I want to look at another change which may have passed you by. American Express is stopping the direct sale of Membership Rewards points on 1st October.

Did you even know this was possible? The facility is mentioned in the Terms & Conditions for the Membership Rewards scheme, for anyone willing to wade through them.

One of the lesser known features of the American Express Membership Rewards programme is the ability to buy up to 10,000 Membership Rewards points per year for 1.5p each.

Note that a lot of Amex call centre agents will never have done this and may deny it can be done.  You may need to hang up and call again.

Let’s have a look at whether this is worth doing in the few days you have left.

Why buy miles indirectly via Amex when you can buy them directly?

Over the last few years, pretty much every airline and hotel programme has brought in a ‘buy points’ option.  This is not surprising – it is easy money for the programme, and they are still charging you more than the marginal cost to them of redeeming the points.

Since American Express is willing to sell Platinum and Preferred Rewards Gold cardholders additional Membership Rewards points, you can use this method to buy yourself airline points for a discount on the price charged by the programme itself.

This method has got more attractive over the last couple of years for those airlines who sell miles priced in US$ or Euro, since the fall in Sterling has made them noticeably more expensive if bought direct.

American Express sells you Membership Rewards points priced in £ so the cost has remained constant.

Of course, many airlines have occasional mileage sales which bring down the price below what you will pay using this route.  Don’t use this method to buy miles speculatively which you don’t plan to use immediately.

This method does not really work for hotel programmes, based on my maths.

How much can you save by buying 10,000 Membership Rewards points?

Let’s take a look at a few examples, based on the points you get from converting 10,000 Membership Rewards points which you have bought from Amex for £150.

This is the full list of airline and hotel groups offering transfers from Membership Rewards in the UK.

Compared to buying 10,000 Membership Rewards points for £150 ….:

UK airlines:

• Avios – 10,000 Avios cost £195 directly (see here), you save £45

• Virgin Points – 10,000 points cost £165 directly (see here), you save £15

Other airlines:

• Asia Miles – 10,000 miles cost £245 directly ($300, see here – can only be done at the point of redemption if already have 70% of the miles needed), you save £95 as well as getting around the ‘can only buy whilst redeeming’ issue

• Delta SkyMiles – 10,000 miles cost £285 directly ($350, see here), you save £135

• Emirates Skywards – 10,000 miles cost £245 directly ($300, see here), you save £95

• Etihad Guest – 10,000 miles cost £160 directly, you save £10

• Finnair Plus – 10,000 miles cost £110 directly (€129, see here), no saving via Amex at the current exchange rate

• Flying Blue – 10,000 miles cost £223 directly (see here), you save £73 (although if you buy direct there is currently a bonus promotion running worth 50% to 100%)

• Qantas Points – 10,000 points cost £200 directly (A$388, see here, points can only be purchased at the point of redemption to top up an existing balance), you save £50

• SAS EuroBonus – 10,000 points cost £145 directly (SEK 2,000, see here), no saving via Amex at the current exchange rate

• Singapore Airlines – 6,667 miles cost £205 directly ($267, you cannot buy online and can only buy 50% of whatever redemption you are planning), you save £55

Hotels:

• Hilton Honors – 20,000 points cost £165 directly ($200, see here), you save £15

• Marriott Bonvoy – 15,000 points costs £155 directly ($187.50, see here), no saving via Amex at the current exchange rate

• Radisson Rewards – 30,000 points cost £170 directly ($210, see here), you save £20 – although it no longer makes sense to buy Radisson points now they have a fixed redemption value of under 0.2p

This method also gets around arcane rules in some programmes. Singapore Airlines, for example, only lets you buy miles directly if you are about to redeem and already have 50% of the miles you need. Asia Miles has a similar rule. The Amex points purchase route lets you get around this.  This method also gets around any annual caps on the amount of miles you can buy directly.

Conclusion

As you can see from the numbers above, there is a big difference between the airline and hotel schemes.

There is often a good saving to be made by NOT buying airline miles directly and, instead, buying up to 10,000 Membership Rewards points from American Express at 1.5p each and converting them. You need to do this by 1st October before the option is withdrawn.

This is not the case with hotel schemes, where buying Membership Rewards points to convert to hotel points rarely offers great value.

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Want to earn more points from credit cards? – April 2024 update

If you are looking to apply for a new credit card, here are our top recommendations based on the current sign-up bonuses.

In February 2022, Barclaycard launched two exciting new Barclaycard Avios Mastercard cards with a bonus of up to 25,000 Avios. You can apply here.

You qualify for the bonus on these cards even if you have a British Airways American Express card:

You can see our full directory of all UK cards which earn airline or hotel points here. Here are the best of the other deals currently available.

Earning miles and points from small business cards

If you are a sole trader or run a small company, you may also want to check out these offers:

SPECIAL OFFER: Until 12th May 2024, the Capital on Tap Business Rewards Visa card is offering a bonus of 30,000 points, convertible into 30,000 Avios. You must have a Limited Company to apply. Click here to learn more and click here to apply.

For a non-American Express option, we also recommend the Barclaycard Select Cashback card for sole traders and small businesses. It is FREE and you receive 1% cashback on your spending.