Flights vs shopping – which rewards are top in value?

Flights vs shopping – which rewards are top in value?

Ladies and gentlemen, Mozo has turned on the “fasten seat belt” sign and is ready to launch the inaugural Experts Choice Awards for rewards credit cards, a look at the best of the best in rewards value for Australian card holders.

Mozo’s money geeks compared the rewards offered on flights and shopping minus the annual fee of 119 credit cards with rewards programs and found one in four rewards credit cards are losing you money and a third of cards deliver less than $20 in net rewards value every year. Enough to make you run to the emergency exit!

Thankfully, there are some rewards credit cards delivering great value (which have made it to our winners podium), but according to our judges you not only need to choose a card best suited to your spending habits, you also need to be extremely selective in what rewards you redeem your points for.

What should I redeem my rewards points on?

Good news for those who love to holiday in Australia, as domestic flight rewards were found by our experts to offer the highest return for your spend, compared to overseas flights, gift cards and cashback.

For example, if you are spending $17,000 a year using the overall Experts Choice rewards credit card gold winner the American Express Velocity Escape Card you could redeem $296 worth of one-way Sydney to Melbourne flights, compared to a gift card only worth $94.

The rewards difference is even greater for big spenders. Say you splashed out $60,000 over a year with the Experts Choice premium rewards credit card winner the NAB Velocity Rewards Premium Card, you could redeem $1415 worth of one-way Sydney to Melbourne flights, compared to a gift card worth only $350, excluding the credit card’s annual fee. That’s a difference of $1065 in rewards value!

Overall winners

Here’s a breakdown of the overall Experts Choice rewards cards winners and the value of the different redemption options if you spent $17,000 a year.

Award

Rewards card

Rewards Net Value
Sydney to Melbourne flight

Rewards Net Value
Sydney to London flight

Rewards Net Value
Gift card

GOLD

American Express Velocity Escape Card

$296

$156

$94

SILVER

NAB Velocity Rewards Premium Card

$293

$85

$-8

BRONZE

Qantas American Express Discovery Card

$276

$153

$133

Premium winners

Here’s a breakdown of the premium Experts Choice rewards card winners and the value of the different redemption options if you spent $60,000 a year:

Award

Rewards card

Rewards Net Value
Sydney to Melbourne flight

Rewards Net Value
Sydney to London flight

Rewards Net Value
Gift card

GOLD

NAB Velocity Rewards Premium Card

$1415

$678

$350

SILVER

ANZ Rewards Platinum

$1242

$587

$752

BRONZE

NAB Qantas Rewards Premium Card

$1213

$559

$346

*Net value = rewards redemption value minus rewards card annual fee.
Source: Mozo.com.au Excludes introductory and bonus points offers. Where both American Express and Visa/MasterCard are issued per account, calculations assume 100% of spend is on American Express

How to get the most value from your rewards credit card:

1. Read the fineprint. Be mindful that some rewards cards have caps on the amount of points you can earn and a rewards point expiry date.

2. Pay your credit card balance in full each month. With the highest rewards card interest rate in Mozo’s database reaching a steep 21.74%, paying interest on your credit card will quickly zap away any true value the rewards points could offer.

3. Don’t be encouraged to spend more. While accumulating rewards points can be a great way to get something for nothing, you shouldn’t spend more than you normally would.

4. Bump up your points with bonus point offers. For example, this year’s premium winner the NAB Velocity Rewards Premium Card offers 40,000 bonus Velocity points if you apply by 19 October 2014 and make a purchase.

Flights vs shopping – which rewards are top in value? was last modified: June 29, 2015 by Mozo

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