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Why applying for Credit Cards in Australia for Frequent Flyer Points isn’t the best idea

I have read so many “how to get more frequent flyer points” articles lately and of course they all say the same things, they are also mostly written for people overseas in Europe and the US. I was shocked to see a recent article written for an Australian magazine, where it encouraged people to go out and apply for credit card to get Frequent flyer points bonus’s, clearly the person who wrote this particular article was from the US or overseas and has no understanding of the Australia credit guide (then again most Australia’s don’t know much about it either!). I wish I had kept the article so I could share with it you.

Why is applying for several of credit cards to get bonus frequent flyer points not the best idea in Australia?

 
We have touched on this in a previous article about Budgeting: Each time you make a credit application this appears on your credit report (even if you do not take out the loan or credit card. The general public are under the general impression that when you file out an online form and provide all of your details, you are asking for a quote to be sent through when instead you are actually making an application, so be wary of this. This is where people encounter problems as they go to 5 or 10 different FI’s ask for an online “quote” to find out they have made an application, in the end negatively affecting their credit report.
So the more credit cards you apply for the more problems you are likely to run into when you want to make a serious credit application, such as to buying a car as yours has broken down or when you want to take out a home loan. Making a lot of credit enquiries will impact you in getting credit and the credit you might be able to get will likely result in a very high interest rate and terrible terms and conditions.

What are best ways for a Australian’s to get frequent flyers points?

  • (I know this one is particularly boring!) Read through the frequent flyers program website (and terms and conditions brochure they send you), have a look at the options to earn frequent flyers points.
  • Link your current credit card up to your frequent flyers program. Put all of your monthly expenses onto your credit card and pay the whole thing off at the end of each month from your savings or home loan offset account. (Don’t go too crazy because you have a credit card – be sensible!)
  • If you are a Qantas frequent flyer member, make an effort to go to Woolworths (for example) instead of Coles supermarket to do your grocery shopping.
  • Sign up to the airlines website newsletter and keep your eyes open for great deals!
  • Make a booking via the airlines website, for hotels, car hire, holidays, tickets activities etc. If you plan a few months a head you might be able to score a deal, price wise and be able to get bonus frequent flyers points! We were able to earn 10,000+ Qantas frequent flyer points for staying at a hotel on the Gold Coast for 4 nights.
  • Connect frequent flyers account to your mobile phone to collect points every time you pay your phone bill.
  • Install the Qantas frequent flyers toolbar in which you earn 1 point per search (keep in mind they do record your searches for marketing purposes).
  • Fly with that particular airline, you will get both frequent flyers points AND status points.
Keep in mind, there is no “secret” to earning frequent flyer points, there might be a loop hole now and then but you need to be quick to get in and utilize it otherwise you miss out.
Then again are frequent flyers really worth making the extra effort to accrue them?

Pros:

  • You can earn frequent flyers points on everyday regular purchases
  • You can use these points to upgrade or purchase free flights (once you have accrued enough)
  • You can participate in “Family pooling” where you and your partner or family can accrue frequent flyers points and send them to you once per year.
  • You can also redeem your points for goodies rather than flights through the airline’s online store

Cons:

  • Frequent flyers Credit cards can attract higher annual fees.
  • Free Flights and upgrades can be expensive (points wise) to redeem and if you are not a regularly flyer, points can take sometime to earn.
  • In regards to status points (these are points you only get from flying), you need to take approx. 10 return flights per year to go from Bronze to Silver if you are flying from Adelaide to Sydney (or Adelaide and Brisbane). This fly earns you 15 Status points and you need 300 to progress to Silver. Of course if you fly overseas you will likely get to silver much quicker but it seems Qantas has reduced its overseas flights with their budget cuts.

Photo Credit: Derek Steen

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Article written by:

Hi, my name is Samantha, Finance Managing Guru by day, Travel Blogging Enthusiast by... well... day too! Haha! Travelling King is the destination hotspot for the wannabe traveller! Showcasing affordable, luxurious getaways for the budget conscious! With the combination of my financial knowledge and travelling experiences I aim to show you, with a little planning, the right budget and a realistic goal you can fulfil your travel fantasies and explore the world whatever your budget or desires may be!

Join the discussion

  1. Olivia

    I get so frustrated by how easy it seems to rack up the points if you’re in the US! In Australia there’s either people giving advice that would work in America but not at home, or just no information on the topic at all. It seems like such a waste to not be trying to earn points but it’s just not practical.

  2. Travelling King

    I completely agree! It drives me nuts! I see a lot of specials from the US and hardly ever seen any from Australia!
    I have given up on actively trying to earn points and just get them from our credit card, haven given up on trying to earn status points on Qantas flights as its almost impossible flying domestically!

  3. Sharon

    We have a credit card that earns QANTAS frequent flier points and I find them pointless for that purpose now. Whenever we have looked into using them, the charges and taxes they charge on top of the points are usually more than just booking the ticket with someone else or even booking with Jetstar/qantas for a seat on the same flight! In part because they charge a big infant fee that they don’t charge otherwise. It’s ridiculous.

    You can of course use more points to cover all these costs, but we have found it far better value to cash out our frequent flier points to woolworths cards, use it for our groceries and use our grocery money to buy flights! They go much further this way.

  4. Travelling King

    They certainly dont make it easy to use the points for flight etc – i looked at a flight to Paris (which apparently my points could buy me) and tha taxes were $500! not sure if i shoudl be shocked that but seems a little excessive.

  5. Sophie

    Same in France! You can read all the frequent flyers hacks, let’s be honest: you’ll have to spend tons of money to just reach one of their credit card bonus… (yep, even with our only cobranded card Amex / Flying Blue)

    Great article, thanks!

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