I was charged extra credit card fees of 0.25%. I was wondering if that is worth paying in order to collect reward points. Just any standard bank credit credit. I thought that cut off used to be around 0.5% few years back. Not sure if that is still the case.
Credit Card Points - How Much Is Each Transaction Worth?
yjun355 on 28/12/2023 - 13:28
Comments
About 1%, give or take, depends on how you spend the points.
If you are a frequent traveler who values upgrades and flies routes where these are available, points are worth more.
If you redeem them for gift cards or similar, a touch under 1% probably.
I pay the fee if it is under 1% and there isn’t an easy zero fee option, I’m a bit more considered if it is more than $200 or so. If I happen to have cash and it is accepted I’ll pay with that to avoid a fee.amex essential is .6% back in points for cash discount
This may give you some idea - Australian Credit Cards - Which cards should you get to have an all-rounded portfolio that suits all your needs?
Thanks for this link
If you head over to Australian Frequent Flyer they'll advise on how to become a churner. That doesn't work for everyone. I've been able to get a 3% yield redeeming QFF points on oneworld Classic Flight Rewards in economy. For this calculation I assume it costs $1 to earn a point (my actual is $0.90 per point). So you need to estimate your personal yield to determine whether the surcharge is worth incurring. The big variable is the cost of earning points and this is where churners are winning.
Don't forget that by using a credit card, you're also earning interest on your own money while it sits in a bank account. For some spend this can be 40+ days - useful if your Cc fees are a quarter of a percentage point but you're earning 5% annual in the bank.
Depends on the credit card. Which card?