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Are premium airline reward cards worth the fee?

With annual fees running into hundreds of pounds, premium cards for frequent fliers don't come cheap. But could the impressive rewards on offer make them more than worth the fee?

Airline reward cards are credit cards that will give you reward points with certain airlines as you spend.

Premium airline reward cards charge a hefty upfront fee but typically give you more points per pound spent and bigger bonuses than cards with smaller fees.

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Are premium airline cards worth the fee?

Typically with a premium airline card:

  • There are substantial welcome bonuses of Airmiles/Avios points on offer
  • You earn enough Airmiles/Avios points for free flights and companion vouchers much more quickly than with standard airline cards
  • Your purchases will be protected and you can enjoy travel insurance included with the card
  • You can earn access to executive airport lounges and other business class upgrades

But to get the most out of these benefits you will need to:

  • Commit to a substantial monthly spend (ie at least £1,000)
  • Pay off your balance in full each month

British Airways, £195 a year for a credit card?

British Airways American Express Premium Plus Credit Card is at the luxury end of the market, costing £195 a year to have.

To make the card really worth this fee you’ll likely need to:

  • Spend at least £1,000 a month on the card
  • Pay off your card balance in full each month
  • Buy several flights a year with British Airways and their partner airlines

But, if you can commit to the above and you’re a frequent flier, this credit card comes with some very rewarding benefits.

25,000 Avios point welcome bonus

You can enjoy a welcome bonus of 25,000 Avios points if you spend £3,000 within three months of getting the card.

However, you can’t just keep getting a new card every three months as the welcome bonus is not available if you have had another British Airways American Express card in the past six months.

Earn more Avios points for your spending

You will be awarded 1.5 Avios for every £1 spent, and 3 Avios for virtually every £1 you spend with British Airways.

But, money spent on fees related to the card doesn’t count as spending, so Avios points are not earned for: balance transfer fees, cash withdrawal fees, foreign exchange fees, travellers cheque purchases, interest charges late payments, returned payments and referral charges.

Where could your Avios points take you?

British Airways estimate:

  • 20,000 Avios is worth a return flight to Marrakech, or similar destinations
  • 15,000 Avios can get a return flight to Rome, or similar destinations
  • 9,000 Avios is worth a return flight to Berlin, or similar destinations

Typically you’ll need at least 30,000 Avios points to get outside of Europe, it takes around 40,000 to cross the Atlantic.

Executive lounge access

You do not get automatic entitlement to British Airways executive lounges, first class check-in or class upgrades, even with the Premium Plus card.

Access to these is determined by British Airways’ Executive Club Tier system, there are four tiers; Blue, Bronze, Silver, Gold. You get access to exclusive deals with all the tiers but, lounge access is reserved for Silver and Gold tiers.

You will be automatically enrolled on the basic Blue Tier, but you can work up the tiers by spending money on flights with British Airways and their partner airlines.

Get a companion voucher

A companion voucher allows you to book another seat for free when you book a flight using Avios points. It’s issued in the cardholders name, so you’ll need to travel on the flight and you can only use one companion voucher per flight.

To earn a companion voucher with the Premium Plus Card you need to spend at least £10,000 within a year. But again, any fees you pay related to the card wont be counted as spending.

Protection on your purchases and travel insurance

Eligible items you buy on the card are insured against theft and damage. You will also enjoy travel insurance, including cover for lost and delayed baggage.

You are also entitled to refunds from American Express if a retailer will not take an item back (though bear in mind any credit card provider is obliged to offer this under Section 75 of the Consumer Protection Act).

Virgin Atlantic, £140 for a credit card?

If you prefer to fly with Virgin you can get a premium card with Virgin Atlantic, who offer Virgin Flying Club Miles as an alternative reward scheme to Avios.

If you want to know more about the benefits and drawbacks of either scheme read our guide on Avios vs Virgin Miles.

The Virgin Atlantic Black Credit Card Account will charge you an annual fee of £140. To justify this fees you’ll need to:

  • Make a purchase in the first 90 days of getting the card
  • Have a large monthly spend on the card (ie £500-£1000)
  • Pay off your balance in full each month

But again, if you can commit to this just like the British Airways Premium Plus card it comes with some impressive rewards.

18,500 Virgin Miles welcome bonus

If you make a purchase within the first 90 days of getting the card you are entitled to a welcome bonus of 18,500 Virgin Flying Club Miles.

There is no minimum value for this purchase, but note that is not awarded on balance transfers, money transfers or cash advances.

It could also take as long as eight weeks to be awarded to your account, so don’t plan to go on holiday with Virgin Miles bonus immediately.

Two cards one account, more Virgin Miles

You get both a Visa and American Express credit card with your Virgin Atlantic Black account, so you can be sure your card will be accepted everywhere.

You get one Flying club mile per £1 spent on the Visa card and double that for every £1 spent with the American Express credit card.

Virgin estimate how many Flying Club Miles a typical cardholder could earn below:

virgin table

Where could Virgin Miles take you?

Virgin Atlantic estimate to get to New York needs 35,000 (economy), 55,000 (premium) or 80,000 (upper class) Virgin Miles. Or to get to Hong Kong needs between 50,000 (economy) and 120,000 (upper class).

You need 10,000-12,500 Virgin Miles to upgrade your class (depending on where you’re flying).

Companion voucher

If you spend at least £7,500 on card purchases on the American Express card in a year, you can receive a companion voucher.

But note that a companion voucher can only be used with full-priced, qualifying Virgin Atlantic flights and are subject to availability.

Upgrade your class

If you spend £5,000 on the American Express card you are entitled to a free upgrade of an Economy class booking to Premium Economy. If you spend another £5,000 You can do it again, but you cab only do this twice per year.

Don’t want to pay an upfront fee?

The equivalent no-fee card from British Airways and American Express, offers many of the same benefits as the British Airways Premium Plus credit card, but the rewards are scaled down.

You can earn one Avios point for every pound spent, the welcome bonus is 9,000 Avios if you spend £1000 within the first three months of owning the card.

You need to spend £20,000 in a year to get a companion voucher.

You can still enjoy travel insurance and refund protection on most purchases.

Don’t want to fly with British Airways or Virgin?

If you want a card with an alternative airline or on scheme other than Avios you can compare more airline reward cards here.

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