Gold Amex: I don’t want to pay fee – where can I go next for Avios?

I opened the American Express Preferred Rewards Gold last year and spent enough to trigger a 20,000 points bonus by spending £3,000 in the first three months, and a further £10,000 before 12 months was up.

In the first year, the card doesn’t carry a fee, but from year two, it carries a £140 annual cost which I don’t want to pay for.

I have ticked into year two now as I am waiting for 10,000 of those points mentioned above. Amex makes you wait up to 60 days for these to arrive.

The American Express Preferred Rewards Gold credit card is often touted as the best way to pick up reward points, but it comes with a £140 fee after 12 months of holding it

The American Express Preferred Rewards Gold credit card is often touted as the best way to pick up reward points, but it comes with a £140 fee after 12 months of holding it

The American Express Preferred Rewards Gold credit card is often touted as the best way to pick up reward points, but it comes with a £140 fee after 12 months of holding it

Once they come, I plan to close the card and pro-rata the fee so, it should cost no more than £23 in the end, which I have easily wiped out in recent weeks anyway through its cashback scheme and I want to keep collecting Avios, even if they are hard to spend at the moment. 

I have always played by the rules but now need a new way to collect, ideally without paying. What are my options? – via email

George Nixon, This is Money, replies: With an annual fee of £140 after the first year and a 56.6 per cent representative APR, despite its considerable travel benefits it is perhaps no wonder some may wish to ditch the American Express Preferred Rewards Gold card when they have claimed all of the bonuses they can.

And while customers do have to pay the £140 fee up-front in order to benefit from the second 10,000 point spending bonus, as you say you can get a partial refund of all but the months you have held the card for, something This is Money addressed back in January.

Rob Burgess, editor of frequent flyer website Head for Points, said: ‘I agree that it is often difficult to justify the annual fee for Preferred Rewards Gold after the first year. 

‘The reader is doing the right thing by waiting for his annual 10,000 points bonus to post before cancelling, and then asking for a pro-rata refund of the annual fee.

‘In normal times I would suggest that he might want to hold the card a bit longer if he had any flights coming up, because the new card year brings two new free airport lounge passes’.

Lounge passes are usually estimated to be worth around £40, but it may be hard to use those right now with the increasing number of destinations appearing on the government’s 14-day quarantine list.

But customers must be careful not to simply close their card, as doing so can lose all those hard-earned points.

‘We often tell people to be very wary about closing accounts that may hold miles and points and to take action to ensure they are not lost’, Nicky Kelvin, director of content at website The Points Guy UK, said.

Should you sell your points back to American Express? 

When you’ve taken out a card with a £140 annual membership fee and a steep APR to maximise earning points, the last thing someone might consider doing is selling them off.

However, Amex gold card holders can benefit until 1 October from exactly that, with customers able to reduce their credit card bill, or even putting it into credit, with their Amex points.

This works out at £6.75 per 1,000 Amex points, or 0.675p each, according to Head for Points

While the aim with reward points is to get as close to 1p per point as possible, Burgess wrote: ‘You could do better but, of course, your current financial position might mean that 0.675p in cash is more welcome.’

However, for those with air mile aspirations, he said: ‘If your end goal was to use your Membership Rewards points for Avios, I would stick with that plan. Don’t bail out for 0.675p of cash, unless your current financial situation means that it makes sense.’

Although, for those yet to turn their Amex points into Avios and concerned about when they will next be able to book a flight with them, it does represent a way to liquidate points in a way that isn’t really possible when they are turned into Avios, as This is Money has previously found.

Should you transfer your points out?

While American Express reward points, which are those earned by spending money on the gold card, can be transferred into British Airways Avios points or Virgin Atlantic Flying Club miles at a 1:1 ratio, or turned into gift cards or used in certain hotel reward schemes, forcing yourself to do so could limit your options.

‘I don’t recommend transferring membership points unless you are absolutely certain about what you want to do with them, because the flexibility is valuable’, Burgess added.

Customers who are certain they wish to turn their Amex points into Avios points or Virgin Atlantic Miles do have some specific free options in the form of the British Airways American Express card or the Virgin Atlantic Rewards credit card.

‘The BA card earns one Avios per £1’, Kelvin said. ‘The Virgin Atlantic Rewards Credit Card earns 0.75 points per £1, which isn’t bad for a Mastercard and may be handy if you often spend money where Amex is not accepted. 

‘Each card has a number of additional perks like upgrade or companion vouchers.’

The BA Amex card also currently benefits from a time limited offer which lasts until 25 October, where every full £2 spent on the card earns an additional Avios point, netting cardholders up to 1,000 in total.

The BA card comes with a representative APR of 22.2 per cent, while the Virgin Atlantic one, which was temporarily taken off sale when flights were grounded in March and April, comes with a 22.9 per cent rate.

Where should you go to keep your Amex points?

But both Burgess and Kelvin suggest previous gold cardholders don’t limit themselves to one reward scheme, and instead recommend a different option.

‘The best way to keep an Amex rewards balance alive if you wish to cancel a fee-paying card is to take out one of the fee-free membership rewards cards such as the American Express Rewards Credit Card‘, Kelvin said.

How else to earn points and cashback 

While the easiest way to earn Avios or Amex points is with everyday credit card spending either in-person or online, deals available through the Amex, British Airways or Virgin Atlantic websites can mean cardholders can earn even more points, or even get cashback, when they spend.

This is most relevant to BA Amex and Virgin Atlantic card holders though, rather than those who hold non-branded Amex cards.

Kelvin said: ‘Airline shopping portals are the most lucrative, with some retailers offering huge earing rates, up to around 40 Avios per pound spend for the most generous offers.

‘You simply need to click through to your chosen online retailer through the airline portal you want miles from to earn. 

‘Some retailers also offer miles when you shop instore – you just need to register your cards with the relevant airline shopping portal.

‘Tesco Clubcard points can be converted to Avios and Virgin Flying Club miles and this is another great way to bolster a miles hoard.’

This card comes with no fee, a 22.2 per cent representative APR, and, crucially, earns you one Amex point per £1.

Unlike Avios or Flying Club miles, which disappear if none are earned or spent in a 36-month period, Amex points do not expire.

‘You can call Amex to downgrade to this card, and your points balance will remain intact’, Kelvin added.

The card also comes with a 5,000 points bonus if cardholders spend £2,000 within their first three months of membership, but those who have held an Amex card, as you have, within the last 24 months are ineligible for this.

The same goes for the BA Amex card, which offers 5,000 Avios if cardholders spend £1,000 over the same period.

In May, American Express gave customers who had applied for a card since January six months rather than three to earn sign-up bonuses, due to the fall in credit card spending as a result of the pandemic.

However, that was withdrawn in mid-August, a move which also applies to customers who benefit from time-limited higher cashback deals. But those who had opened a card by the time the offer was withdrawn will still benefit.

And with both cards earning points, which in the Amex card’s case are much more flexible, Burgess recommended going with the vanilla Amex card rather than the British Airways-branded alternative.

He said: ‘Both earn Avios at the same rate, but the Amex card gives many other transfer options apart from Avios. 

‘It is only worth getting the free British Airways card if you know you will spend £20,000 per year to trigger the 2-4-1 companion voucher.’ 


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