No, we haven’t lost our marbles, and we’re not doing an about-face. While we do often say that’s it’s simply not worth it to spend heaps on your credit card just for the sake of earning points, that warning is directed at people who might buy things they don’t really need and can’t actually afford to pay for. They end up paying interest on their overdue purchases balance so that the cost of the points is far greater than any possible points redemption value.
Higher income earners can exploit this offer
So the advice stays in place for lower income earners. But what if you have an annual income of at least $75,000, and could therefore be approved for the ANZ Frequent Flyer Black Credit Card?
You’ll be the sort of cardholder who can usually afford to pay off their account balance every month, and spending $7,500 in the first three months of holding the card could be very lucrative.
It will earn you:
- 120,000 bonus Qantas Frequent Flyer points
- 7,500 regular Qantas points for the $7,500 spending
- $150 cashback
- 75 bonus status credits.
The first-purchase benefits are truly rewarding
Without putting a monetary value on the status credits (even though they can help score you perks like seating privileges, increased baggage allowance, priority check-in and lounge access) the remaining benefits add up to a lot of cash in your pocket.
Use your 127,500 Qantas points for seat upgrades, business class seating and/or long-haul flights. A recent article in Choice online calculated that Qantas points redeemed for seat upgrades could be worth as much as 4.8 cents each, but let’s be super conservative and value them at 2.0 cents each.
That makes your 127,500 points worth $2,550. (The cheapest return economy flight from Sydney to London costs about $2,305 or 120,000 points before taxes and charges, validating the 2.0 cents valuation.)
You’re going to want to get your hands on that $2,700 ($2,550 in points + $150 cashback) and it’s much easier than it looks at first glance.
Whoopee! It’s that time of year again
Blame our US cousins if you like, but Australians didn’t take much persuading to embrace the Black Friday hype, with an additional $200 million-plus being spent on the day in 2017.
And Black Friday is followed by Cyber Monday, as surely as night follows day. Meanwhile, Christmas is just around the corner (as your local shopping centre reminds you every day).
You think that you always avoid the temptation to spend more at this time of year? Please refer to your credit card statements for last November and December. Case closed.
Which means that now is the ideal time to take on a card that might require you to spend to a little more than normal for the sake of that huge bonus.
But is it really any more than normal?
Never pass up an opportunity to use your card for everyday purchases
It’s time to do your bit towards promoting the cashless society.
In the era of speedy Tap & Go, there’s very little excuse for not bringing out your card every time you visit a supermarket, department store or petrol station—much less of a chore than messing about with cash, and getting shrapnel as change.
But if a card is still a bore, consider paying with your phone and leave your card at home. Many cards are now compatible with Apple Pay, Android Pay or Samsung Pay, with some accepting all three.
Use your phone to buy your daily coffee and avocado on toast, and rack up the equivalent of a house deposit in no time!
Pay your utility bills with your credit card
Most energy retailers will accept payment by credit card, but you need to be careful about your payment method if you want to earn points.
You won’t earn any Qantas points by paying with your ANZ card through BPAY, for example, if the biller’s arrangement with BPAY treats these payments as a cash advance.
You also won’t earn points for over-the-counter bill payments at Australia Post or a bank. But who has time for that anyway?
You can avoid the potential BPAY trap by visiting your electricity, gas and telecommunication providers’ websites to organise an automatic charge to your credit card account whenever each monthly or quarterly bill becomes payable.
Set and forget, and watch the points roll in.
In fact, pay all your bills this way
Apply the same automated payment principle to other regular bills like insurance premiums, pay TV, news and magazine subscriptions and insurance premiums (including health insurance).
You can even afford to pay credit card surcharges
Those nasty surcharges (aka ‘merchant fees’) for the privilege of paying by credit card are still around in some places.
But since you’ll earn one Qantas point for each dollar you spend, and you’re going to use them wisely and make them worth 2.0 cents each, you can afford to pay a surcharge of up to 1.9% and still come out ahead.
Good news for renters
How sad is it that we can’t make our mortgage repayments with a credit card?
But for those avocado-on-toast-eating people who are still renting their accommodation, there’s yet another great way to not only meet the spending target but also earn ongoing points.
Just go to rentalrewards.com.au to sign up for paying your rental agent by credit card.
You’ll get to take advantage of the interest-free days, plus earn Qantas points on your credit card payments. Information on the site says that your card payments will not be treated as a cash advance, so they will definitely earn points and count towards the spending target.
What a breakdown of your $7,500 spend might look like
We’ve given you heaps of ideas about ways to spend that $7,500 on things you were going to buy anyway, or bills you can’t avoid paying. But let’s look at some actual numbers to see how relatively easy it would be to reach the target.
The Australian Bureau of Statistics publishes data on average weekly household spending, with the latest available figures relating to the tax year 2015-2016.
Extracting everyday purchases which can be paid for with a credit card, and multiplying them by 13 (to show average expenditure for 13 weeks, i.e. three months) produces the following results:
Even without adding any discretionary expenditure–recreation, clothing, alcohol, domestic furniture and equipment–the average household would spend more than $7,500 in three months on everyday items which could be charged to a credit card (and these are 2016 numbers, remember).
But what if you’re under 35 and single? Here are the ABS numbers for you, with a little discretionary expenditure thrown in.
So even if you don’t have two kids and a mortgage, it won’t take much effort to chew through $7,500 on your card in three months.
It might even be worthwhile spending ahead if you can afford it, on Black Friday, Cyber Monday, Christmas, and the Boxing Day sales.
If you find that the end of your first three months is drawing close, and you’ve fallen just short of your target, here are some ideas for paying now and spending later, for things you were going to do anyway:
- Buy Woolworths gift cards (online) or Coles gift cards (in-store)
- Book your next holiday and pay the deposit
- Pay for future restaurant or entertainment deals at sites like Groupon and LivingSocial
- Contact utility companies to see if they’ll let you prepay your next bill
$7,500–not such a big mountain to climb. More of an everyday hill.
And the reward when you get to the top?
127,500 Qantas points and $150 in your pocket.