A holiday is the second-biggest expense Aussies are currently saving for, behind living costs, according to Canstar’s latest Consumer Pulse Report.
With many Australians planning to travel again after years of travel restrictions, and at a time when living costs are squeezing household budgets, one way to cut costs is relying on frequent flyer points.
Also read: 3 ways to boost your frequent flyer points
While buying an airfare is one way to earn points, there are many other ways that can help you boost your balance. Here are seven ways to increase your frequent flyer points this year.
1. Look for the right credit card
While it may seem obvious, one of the first steps to earning more frequent flyer points is comparing credit cards and finding one that suits you. Look for a credit card with a high earn rate (the number of points earned per dollar spent) while factoring in any conditions or points caps that may apply. You can compare cards that earn Qantas Points and Velocity Points, or look at joining both schemes.
But before you sign up, check the card’s annual fee, as well as the interest rate. Frequent flyer credit cards usually charge higher annual fees and interest rates than non-rewards credit cards so, you’ll want to make sure you know what they are.
The good news is if you will regularly use your credit card and pay it off in full each month, the benefits you can get from the card could offset the annual fee or even exceed it. However, if you rarely use your card or are likely to carry a balance on your card month to month, it may not be worth the extra costs.
2. Sign-up bonuses
Many card providers offer large sign-up bonus points for new credit card customers. Be sure to check if any conditions apply – for example, some providers will require you to spend a certain amount of money within a set time period or to hold onto the card for a minimum term to get the extra points.
Also, be careful to not sign up for a credit card based purely on the sign-up offer. Consider the overall impact of a credit card on your finances before applying, taking into account the interest rate and annual fee, and whether a credit card is appropriate for your situation more generally.
Also, don’t apply for lots of different cards at the same time to get sign-up points as this could have a negative impact on your credit score, which may make it more difficult to get credit in the future.
3. Use your card for everyday expenses
A great way of getting those points happening is to use your credit card to pay for everyday or recurring expenses, such as groceries, fuel, electricity, internet and phone bills. But you will need to make sure you can pay off your balance in full each month. If you only make the minimum repayment on your credit card each month, you’ll be charged a lot of interest on these expenses.
Work out how much you spend in a typical month and find a card that maximises the frequent flyer points you will earn based on that spend level.
Also, only ‘eligible’ purchases will earn you points. For example, generally you can’t earn points on cash advances, interest payments, banking fees and charges, or gambling. Check the T&Cs with your credit card provider, and read the product disclosure statement (PDS) for the details.
4. Shop at partner retailers
Qantas, Velocity and other frequent flyer programs allow you to earn points by shopping with their partner retailers or using partner services. If you use your credit card to pay, this could boost your points balance even more.
Qantas also has a web browser extension that can help you identify where you could earn Qantas points when shopping online.
You can convert Woolworths Everyday Rewards points to Qantas Points, while Coles’ Flybuys points can be transferred to Velocity Points. When you need to fuel up your car, you can earn Qantas Points by heading to a BP, and Velocity Points for filling up at a 7-Eleven. You can also earn Everyday Rewards points at Ampol and then convert them into Qantas Points. Uber has also partnered with Qantas to earn frequent flyer points when you ride.
5. Pool points with family members or your partner
You may be able to enlist a family member’s help with building your points balance.
Most programs will allow you to transfer your points to a family member. Pooling them this way could help you to build enough points to take advantage of a reward you both would like. However, there may be a cap on the number of points you can transfer each year.
You could also consider getting a joint credit card with a family member or partner or adding them as an additional cardholder on your credit card. Keep in mind that, as the primary cardholder, you will be responsible for the additional card and will need to pay for transactions made. You may also need to pay an annual fee for each additional cardholder.
6. Factor in any ‘free’ extras
It may be worth finding a card with additional perks or bonuses to help offset some or all of your annual fee. An example would be cards that may have an annual fee of around $200, but provide you with an annual free return domestic flight or a travel credit. While this may not add to your frequent flyer points, it’s a good benefit if you travel regularly.
7. Check out other points-earning products
Another way of earning frequent flyer points is to look at some of the other financial products that offer frequent flyer points.
You can earn Qantas Points on Qantas Insurance products such as health insurance, car insurance, home insurance and travel insurance. Qantas currently offers a variety of deals to earn extra points when you join up, such as one point for each dollar spent on your premiums.
The Qantas Wellbeing App also lets you earn points for everyday activities like going for a run, swim or cycle. Qantas has also partnered with home loan providers, Qudos Bank and La Trobe Financial, so you could earn Qantas Points for paying off your home loan.
Similarly, you can earn Velocity Points by taking out certain products with their partnered providers for products like home insurance, travel insurance, and home loans. Velocity has partnerships with Medibank, Medibank Pet Insurance, Cover-More travel insurance, and uno home loans.
Of course, points alone shouldn’t dictate which products you use but, if the price and the features suit, it can be a good way to boost your points balance.
Spend your points wisely
When it comes time to redeem your hard-earned points, make sure you get the best value out of them. You can redeem your Qantas Points for domestic and international travel with Qantas or their partnered airlines such as Qatar Airways, Japan Airlines and British Airways, just to name a few. Likewise, you can do the same with Velocity Points by cashing them in for flights with Virgin Australia or one of its partner airlines, such as Singapore Airlines or Etihad Airways.
If you manage to pay for your whole flight with points, it still may not be entirely free. You may still need to pay government taxes, airport fees and other surcharges so you’ll need to have a little extra to cover those charges. For example, Qantas Frequent Flyer and Velocity Frequent Flyer have ‘carrier charges’ that must be paid in addition to taxes and fees.
To make the most of your points when you do decide to take a holiday, be sure to book your flight early before any reward seat redemptions fill up.
What to watch out for in a frequent flyer credit card
If you decide to take out a frequent flyer card, it’s important to keep track of your spending and pay your credit card on time to avoid interest or late-payment charges. Remember that frequent flyer cards can typically have higher interest rates and annual fees than non-rewards cards. Be careful to not overspend on your credit card in order to earn more rewards points. While you’re busy building up those points, don’t forget they may have an expiration date.
Here are Canstar’s top-rated frequent flyer credit cards - based on a monthly spend of $3,000.