Got the free BA Amex card? Learn how to reduce your £20k 2-4-1 target to £10,000

We ran an article yesterday to explain how American Express treats refunds made to your card.  As I pointed out, a refund counts against your annual spend if you are trying to earn an annual bonus.

In my case, for example, the £2,000 refund I am due from British Airways on my British Airways American Express Premium Plus card means that I will now need to spend £12,000 this year – not £10,000 – to trigger my next 2-4-1 voucher.

At the bottom of that article, I suggested that holders of the free British Airways American Express card should upgrade – if only temporarily – to the Premium Plus card if they are worried about triggering their 2-4-1 voucher.

Here was my logic:

many holders of the free British Airways American Express card will struggle, under lockdown, to spend £20,000 this year to trigger their 2-4-1 Avios companion voucher

upgrading to the Premium Plus card only costs £16.25 per month in fees (£195 / 12) as the fee is refundable pro-rata

because the Premium Plus card only requires £10,000 of annual spend to trigger your 2-4-1 voucher, once you have upgraded you will either:

trigger your 2-4-1 immediately, if you have already spent £10,000+ on your free British Airways American Express, allowing you to downgrade again quickly, or

trigger your 2-4-1 as soon as you pass £10,000, allowing you to downgrade again at that point

Either way, it is an easy solution if you are worried about missing out on your next voucher.  It doesn’t seem, at the moment, that any support will be forthcoming from American Express or British Airways in terms of reducing spend targets.  You can’t be blamed for taking matters into your own hands.

There is no formal upgrade process.  You simply apply online for the BA Premium Plus card here.  Your existing free BA Amex is automatically cancelled and your existing membership year and spending to date target is carried over.  You don’t qualify for the 25,000 Avios sign-up bonus on the Premium Plus card as an upgrader.

You can downgrade to the free card again as soon as you have your 2-4-1 voucher in your Executive Club account.  The annual fee on Premium Plus is refunded pro-rata, so your net cost is only £16.25 (£195/12) per month.

You shouldn’t have the free British Airways card anyway ……

I know that a lot of Head for Points readers have the free British Airways American Express card, hence my advice above.

However, you really shouldn’t.

If you have this card, this is why I think you should switch.  The reasoning depends on whether you spend £20,000 to trigger the 2-4-1 companion voucher or not.

Scenario 1:  ‘Yes, I do spend £20,000 per year on my free British Airways American Express card’

For a high spender, the free British Airways American Express card makes no sense.  If you could spend £20,000 on the free BA Amex card to trigger the 2-4-1, I think you are better off spending £195 to get the Premium Plus card instead.  This is because:

The 241 voucher is only valid for one year on the free BA Amex, instead of two years for the BA Premium Plus voucher.  The one year expiry on the free card is a major issue if you want to book seats 355 days in advance as it is virtually impossible to time your voucher issuance so neatly.

The £10,000 of ‘extra’ spending required to trigger the voucher on the free card (£20,000 compared to £10,000 on the Premium Plus card) could be directed elsewhere triggering sign-up bonuses on other cards.  You could also get a Premium Plus card for your partner and put your ‘spare’ £10,000 of spending on that, earning a 2nd 2-4-1 voucher in your household each year.

You earn an extra 0.5 Avios per £1 spent (1.5 Avios per £1) which offsets much of the £195 annual fee on the Premium Plus card.  £20,000 on the paid card would earn you 30,000 Avios vs 20,000 Avios on the free card.  If you value an Avios at 1p, this is £100 of value you get back immediately.

If you spend £20,000 on the free British Airways American Express card, you shouldn’t.

Scenario 2: ‘No, I don’t spend £20,000 per year on my free British Airways American Express card’

Sorry, but I think you are potentially making a mistake too.

I know that a lot of people don’t spend large amounts on their free BA Amex card.  They don’t trigger the 2-4-1 companion voucher BUT they like earning 1 Avios for every £1 they spend.

Someone spending at least £10,000 per year should upgrade to the Premium Plus Amex card.

If you spend under £10,000 per year, you are better off with the lesser-known American Express Rewards Credit Card pictured above.

The American Express Rewards Credit Card is a standard Amex-branded credit card.  It has no annual fee and no substantial benefits, except for the ability to collect Membership Rewards points at 1 point per £1 spent.  You can find full details here – it has a representative APR of 22.9% variable.

You will not get the sign-up bonus if you have had a Gold or Platinum American Express card – or any other Amex card which gives Membership Rewards points – in the last 24 months.  You can still apply for the card, however.

Why is the Amex Rewards Credit Card better than the free BA Amex card for low spenders?

Here’s the interesting bit:

The free British Airways American Express card earns 1 Avios per £1 spent

The free Amex Rewards Credit Card earns 1 Membership Rewards point per £1 spent.  These transfer 1:1 into Avios points if that is what you choose to do.

What you get with the American Express Rewards Credit Card is flexibility.  Yes, you can use your points for Avios.  You can send them over to British Airways via the Membership Rewards website and they will arrive within 48 hours, often 24 hours.

However, you have other options.  Membership Rewards points can also be sent to Virgin Atlantic, Flying Blue, Emirates, Etihad and Delta among other airline partners.  You can also send them to Hilton Honors (1:2), Marriott Bonvoy (2:3) and Radisson Rewards (1:3).  You can convert them to Club Eurostar (15:1).  You can even use them for shopping vouchers.  You can see the airline partners here.

You have more choice.  You can still take Avios if you want, and at the same 1 Avios per £1 earning rate.  If you suddenly decide that you want hotel points, or that Virgin Atlantic miles make more sense, or even that you want to abandon Avios altogether, you can.  Simply move your Amex points somewhere else instead.

With the free BA Amex card, your points are sitting in Avios from Day 1 and you can’t do anything else with them.  If Avios devalues its rewards, if BA stops flying your preferred route, if reward availability suddenly gets a lot harder to find, if Reward Flight Saver fees jump up, if new surcharges get added, if BA fails to survive coronavirus ….. you’re stuck.

The only good reason NOT to drop your free BA Amex is that having the Amex Rewards Credit Card means that you cannot get a sign-up bonus on an Amex Gold or Amex Platinum card afterwards.  On the other hand, once you have gone two years without the free British Airways American Express, you would be able to apply for the British Airways Premium Plus card and receive the sign-up bonus of 25,000 Avios.

(I know that the sign-up rules for American Express cards are now hugely complex.  This HfP articles explains, step by step, which American Express cards you can still get a bonus on, based on the cards you have.)

Conclusion

If you have the free British Airways American Express credit card, and are struggling to hit your £20,000 annual spending target due to lockdown, you should think about quickly upgrading and downgrading to the Premium Plus card.

This will trigger your voucher as soon as your spending passes £10,000 in your current card year.

Longer term, stop and think about why you have the free BA Amex card.

If you are spending more than £10,000 on the free card, the Premium Plus version offers you a better deal.  If you are spending less than £10,000, the American Express Rewards Credit Card offers all of the same benefits (no fee, the equivalent of 1 Avios per £1) with a lot more flexibility.

Want to earn more points from credit cards? – December 2021 update

If you are looking to apply for a new credit or charge card, here are our November 2021 recommendations based on the current sign-up bonus. 

You can see our full directory of all UK cards which earn airline or hotel points here. Here are the top current deals:

British Airways American Express

5,000 Avios for signing up, no annual fee and an Economy 2-4-1 voucher for spending ….. Read our full review

British Airways American Express Premium Plus

25,000 Avios and the UK’s most valuable credit card perk – the 2-4-1 companion voucher Read our full review

American Express Preferred Rewards Gold

Your best beginner’s card – 20,000 points, FREE for a year & two airport lounge passes Read our full review

The Platinum Card from American Express

30,000 points and an unbeatable set of travel benefits – for a fee Read our full review

Earning miles and points from small business cards

If you are a sole trader or run a small company, you may also want to check out these offers.

American Express Business Gold

20,000 points sign-up bonus and free for a year Read our full review

American Express Business Platinum

40,000 points sign-up bonus and a long list of travel benefits Read our full review

British Airways Accelerating Business American Express

30,000 Avios sign-up bonus – plus annual bonuses of up to 30,000 Avios Read our full review

Capital On Tap Business Rewards Visa

The most generous Avios Visa or Mastercard for a limited company Read our full review

For a non-American Express option, we also recommend the Barclaycard Select Cashback card for sole traders and small businesses. It is FREE and you receive 1% cashback on your spending:

Barclaycard Select Cashback Credit Card

1% cashback and no annual fee Read our full review