“Should I convert my £1,800 of Tesco Clubcard vouchers into Avios by 18th January?”

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As we have covered, Tesco Clubcard and Avios are going separate ways on 18th January. Click for the story. This is the last day to send your points over.

It seems that Virgin Flying Club will remain a Tesco Clubcard partner, although Virgin Red – which will take over all non-flying offers for Virgin Points in the new year – has yet to confirm this.

Should I convert Tesco Clubcard points to Avios

A reader writes …..

A reader wrote to me this week asking what he should do with his £1,800 of Tesco Clubcard vouchers, which would convert to well over 400,000 Avios. I thought I would run through what I told him for the benefit of others in a similar boat.

(The reader didn’t explain how he had so many Clubcard points, given the paucity of deals recently. I imagine that he had a Tesco Bank mortgage and received a substantial points compensation payment when Tesco pulled out of the sector.)

In this particular case, the reader has an existing pot of 400,000 Avios. His current plan was – sensibly – to dripfeed the Clubcard points across as he needed them. This meant that he was not at risk if there was a negative change to the Avios scheme.

One concern he has is that, with credit card sign-up bonuses now harder to achieve, he may struggle to obtain more Avios in the future if he does not convert his existing Clubcard points stash.

My thoughts ….

If we’re honest, for anyone sitting on a small stash of Clubcard vouchers (I have £25-worth unredeemed), there isn’t much at risk. If I move them to Avios and Avios devalues, I haven’t lost a lot.

If you are sitting on larger sums, it does become an issue. Here are some key points to consider:

The ‘Clubcard to Avios’ conversion rate is strong

Getting 2.4 Avios for 1 Clubcard point is a strong exchange rate. It is important to remember this.

Other Clubcard redemptions are not as good as they seem

There are Clubcard redemption offers which claim to offer ‘3x face value’. If this is true, you would be ‘paying’ 1.25p per Avios since the alternative to taking 2.4 Avios is getting a 3p discount on a Pizza Express meal, Hotels.com booking etc.

In many cases, you are NOT getting a genuine 3x. With Hotels.com, for example, Clubcard bookings do not earn Hotels.com Rewards credit which is equivalent to 10% of your spend. This makes it nearer 2.7x.

We did an article recently looking at other travel-related Clubcard deals. Railcard IS a true ‘3x’, as is Eurotunnel, since these brands rarely discount. This isn’t the case for many brands.

Virgin Points remain an option

As far as we know, Virgin Atlantic is remaining a Clubcard partner. The transfer rate is marginally better than Avios at 2.5 Points per 1p of Clubcard points.

The airline has a limited route network, however, and it is changing rapidly. No-one can be sure where it will be flying in 12 months or even if it will survive – although the odds are looking better now that travel will pick up before its rescue funding runs out.

With £1,800-worth of vouchers, our reader has a bigger problem than most

One problem for our reader is that he has so many vouchers.

No-one needs £5,400 of Pizza Express vouchers, or Railcard vouchers, or Alton Towers tickets. Many of the travel options are also restricted – the Hilton offer, for example, is OK but restricted to the UK and Ireland. I wouldn’t wish a tour of UK Hilton hotels on anyone …..

My best suggestion was this …..

Assuming that none of the package holidays deals looked attractive, I told the reader to look closely at Hotels.com.

With over 325,000 hotels globally, he won’t be stuck for options. There is no limit on redemptions – each booking can’t use more than £750 of converted vouchers, but you can back-to-back your stays for a longer trip.

There are reasons NOT to use Hotels.com, especially if you have hotel elite status. Hotels booked through them do not earn points and you won’t receive any status benefits. The reader didn’t say what his hotel elite statuses were.

It is also worth noting that Hotels.com bookings made with Clubcard points are non-refundable.

However, assuming no status, he is diversifying his risk by continuing to sit on his vouchers and assuming he can convert into Hotels.com down the road. This may be a better route than doubling up his existing 400,000 Avios to well over 800,000 Avios.

And here’s the maths behind it …..

Here is a mathematical reason to back up my thinking.

Let’s treat Hotels.com vouchers as worth 2.7x the face value of Clubcard points, instead of the advertised 3x.

£1 of Clubcard vouchers gets you £2.70 of Hotels.com credit or 240 Avios. This means the reader is ‘paying’ 1.125p per Avios (270/240) by giving up the Hotels.com vouchers and taking the miles intead.

However, Avios will regularly sell you points for a little less than 1.125p. There are a couple of 50% ‘buy Avios’ bonuses each year where you will pay just under 1.1p per point.

If 50% bonuses for buying Avios continue, there is no risk to our reader by opting for Hotels.com vouchers instead of Avios.

If he does decide that he needs more Avios down the line, he can use the money he saved on stays by using the Hotels.com vouchers to buy Avios in a future ‘50% bonus’ promotion. He is no worse off and he has reduced his risk by not going ‘all in’ with Avios now.

These are my thoughts. If you disagree with my thinking, please let us know in the comments below.

How to earn Avios points from UK credit cards

How to earn Avios from UK credit cards (December 2021)

As a reminder, there are various ways of earning Avios points from UK credit cards. Many cards also have generous sign-up bonuses!

There are two official British Airways American Express cards with attractive sign-up bonuses:

British Airways BA Amex American Express card

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 BA Premium Plus American Express Amex credit card

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

You can also get generous sign-up bonuses by applying for American Express cards which earn Membership Rewards points, such as:

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

Run your own business?

We recommend Capital On Tap for limited companies. You earn 1 Avios per £1 which is impressive for a Visa card, along with a sign-up bonus worth 10,500 Avios:

Capital On Tap Business Rewards Visa

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

You should also consider the British Airways Accelerating Business credit card. This is open to sole traders as well as limited companies and has a 30,000 Avios sign-up bonus:

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

Click here to read our detailed summary of all UK credit cards which earn Avios. This includes both personal and small business cards.

(Want to earn more Avios? Click here to visit our home page for our latest articles on earning and spending your Avios points and click here to see how to earn more Avios this month from offers and promotions.)

Category

British Airways and Avios, Tesco Clubcard

This article is closed to new posts. Discussion continues in the HfP Forums.

Liz says:

16 Nov16 November 10:01

*half not have
Nick says:

16 Nov16 November 10:05

Rob, I’ve seen reference to ‘commercial Avios proposition changes’ from January. Do you know anything about what this might be? Minor tweaks or full-scale revolution?
RussellH says:

16 Nov16 November 11:01

A completely different option for Tesco vouchers is a charitable donation.
https://secure.tesco.com/clubcard/donate-to-charity
Current options are Trussell Trust, British Heart Foundation, Cancer Research UK, Diabetes UK, Fare Share.
All charities are under enormous pressure at present, but my personal choice at present would be the Trussell Trust. Demand at Food Banks has risen very significantly over the last few months – reports in the national press.
And from personal experience, I have had to issue many more food vouchers for people to collect from our local Food Banks compared with earlier this year.
- The real John says:
  
  16 Nov16 November 11:09
  
  It would make more sense to choose a clubcard redemption at 2.5x value and donate to the charity directly.
  
  You could even donate 2x the clubcard voucher value which would be a win-win for yourself and the charity.
  
  If you are going to spend the vouchers in Tesco at 1x, I suppose it is marginally more efficient to donate them since the charity will get a single payment from Tesco rather than many small payments from individuals.
  - Charlieface says:
    
    16 Nov16 November 14:59
    
    +1
    This is the real reason why you shouldn’t do it
  - Lady London says:
    
    16 Nov16 November 16:37
    
    Not sure how long Tesco will take to hand the money over to charity though. Personally I’d give the cash to the charity direct as then I’d know the charity has it to help people now.
- blenz101 says:
  
  16 Nov16 November 11:29
  
  Pretty depressing if any of the target readers from this website looking to maximise the value of their points and miles decides to donate any significant amount of Tesco vouchers into a charity donation which ultimately benefits the supermarket itself.
  
  Charity is fine and I don’t begrudge anybody making a cash donation, it may even have a tax advantage.
  
  However, encouraging Tesco to donate on your behalf is not the way to go. Food banks already act as a dumping ground for their waste whilst allowing them to claim what great corporate citizens they are. Why should they also get to talk about how much cash they have donated to these charities when it is actually the generosity of their customers rather than a corporate who won’t even pay its staff a living wage.
  
  There is obviously a political argument here about the role of the state acting as a safety net and if by encouraging charity to take up that role (even funding redistribution efforts of waste food) is good for society. That isn’t really a debate for this site but I did want to make the point about not making your charitable donations via Tesco as a not the way to go.
  - ken says:
    
    16 Nov16 November 14:54
    
    “I don’t begrudge anybody making a cash donation”
    
    That’s very generous of you
    - blenz101 says:
      
      16 Nov16 November 17:35
      
      My point was that I was not objecting to charitable giving but strongly objecting to to making a dontation via Tesco. As others have also said, it is the worst option available.
- TGLoyalty says:
  
  16 Nov16 November 13:59
  
  Take the 2.5x redemption and donate directly so they can at least claim the gift aid
  - Genghis says:
    
    16 Nov16 November 15:23
    
    And you claim tax relief if HRTP / ARTP.
    - Lady London says:
      
      16 Nov16 November 16:38
      
      ?
      - Genghis says:
        
        16 Nov16 November 16:42
        
        Not sure if that’s a response to me but take a look at this
        https://www.gov.uk/donating-to-charity/gift-aid
        I make a note of all eligible charitable gifts throughout the year and then claim the tax back.
      - Lady London says:
        
        16 Nov16 November 17:54
        
        Tx @Genghis
      - Alan says:
        
        20 Nov20 November 06:44
        
        Higher rate tax payer, additional rate tax payer…
Tony says:

16 Nov16 November 11:09

That is a really good option because as you say pretty much all charities are having an extremely difficult year.
- blenz101 says:
  
  16 Nov16 November 11:32
  
  It’s a terrible option. Even if you just spent your vouchers in Tesco at face value and gave the equivilent amount to a charity in cash at least the charity could claim Gift Aid and benefit from an extra 25p in the £.
  
  Awful suggestion on many levels.
uarter says:

16 Nov16 November 11:27

Is there a 2 week cut-off before the end of quarter to convert points into Faster Vouchers? i.e. 4th Jan 2021
Not sure if I’m getting confused with this, but if so, could catch a few people out if they’ve got a decent points balance from the quarter still to convert.
- ChrisC says:
  
  16 Nov16 November 11:54
  
  Rob addressed that in the very first sentence of the article
  
  “As we have covered, Tesco Clubcard and Avios are going separate ways on 18th January. …This is the last day to send your points over”
Mark says:

16 Nov16 November 11:31

We’re in a similarish situation with around £1000 at face value between us, built up over an extended period of time. With it now being much harder to obtain both Clubcard and Amex MR points I was expecting to run them down over the coming year or two with many going to Avios. I’m thinking half to Avios which will give us a good stash for our next 2for1 redemption and keep back the other half for Virgin and/or Hotels.com.

Virgin is much more attractive (assuming it survives of course) now the credit card vouchers can be used for PE to UC upgrades without status. More attractive to use two vouchers for both of us on a return trip in most cases than to use one voucher as a 2 for 1.5 on an UC redemption.
Michael says:

16 Nov16 November 12:16

Did anyone receive the 3000 cc points for Tescp Pet Insurance.
I never received mine, I paid 4 premiums of £ 5.xx each beforeI cancelled Will try to chase again.
- Reds says:
  
  16 Nov16 November 13:37
  
  My points were sent to my daughter’s Clubcard account. If you have other household (same address) with Clubcard accounts, worth checking up the other accounts.
Nick says:

16 Nov16 November 13:37

I have only £45 of Tesco vouchers and only 5000 virgin miles. Am I correct in thinking If I convert enough vouchers to Virgin miles @625/£.250 taking my Virgin miles total to 10,000 I can then transfer this to another scheme?
- Genghis says:
  
  16 Nov16 November 13:49
  
  Yes, but is it the right thing to do?
  
  So you’ll need 5k Virgin miles to true up to the 10k VFC miles. That equates to £20 of Tesco vouchers. Arguably worth £54 of hotels.com vouchers, or £60 Tesco delivery saver etc.
  
  With the 10k Virgin points you can get 15k HHs (= £50 at 1/3p valuation) or 10k IHGs (= £40 at 0.4p valuation).
  
  In short, you’ll end up with something worth less than just the worth of the Tesco vouchers. I’d just leave things where they are and add to them.
  - Nick says:
    
    16 Nov16 November 14:01
    
    Genghis, brilliant, thanks for your response as you say leave as!
  - TGLoyalty says:
    
    16 Nov16 November 14:27
    
    Agree completely. Probably best just increasing your FC balance they no longer expire so should be good forever. I’d then look at ways to earn a few more FC points.
  - Nick_C says:
    
    16 Nov16 November 19:00
    
    Personally, I don’t agree. I would use £20 of CCP to add to the 5000 Virgin Points and convert to 15000 Hilton points worth £50. But I don’t think Hotels.com are a good use of Tesco points, I do actively collect Hilton points, and I still think it likely that Virgin points may be worthless if you leave them where they are.
    
    My example on the previous page shows that if I had used CCP to pay for my last Hotels.com booking, I would have got 1.85p of value for each CCP, not 2.7p, and I would have been making a non refundable booking instead of a flexible one.