Best Way to Use CBA Points?

ilikedeals on 19/12/2018 - 16:41
Last edited 19/12/2018 - 17:15 by 1 other user

I have been a Diamond Rewards cardholder for a number of years, but looking at closing my account now for a number of reasons:
- Bank-issued AMEX no longer available (therefore no AMEX offers and no lounge passes)
- $349 yearly fee
- Average customer service

I have earned quite a few CBA Awards Points and wanted to know what would be the best way of using these before leaving the Awards program? Some options:
- Gift card redemption (200 pts = $1)
- Myer/Flight Centre credit (roughly 200pts = $1)
- Convert to QFF points (2.5 Awards: 1 QFF pt)
- Convert to Velocity points (2 Awards: 1 QFF pt)

I'm assuming given the value of frequent flyer points, that converting all Award points to velocity points would be best case scenario?

Related Stores

Commonwealth Bank

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  [Deactivated] on 19/12/2018 - 18:42

  +2

  Ouch. They're giving me the diamond awards for $59 a year (was a free upgrade from the base rewards card) which makes it harder to ditch (all cards suck now). Personally last I looked at it Coles gift cards were the best, though they've made them slightly worse and shut the loophole in the last 18 months or so (You used to be able to points + pay and the +pay was at the discounted rate they paid for gift cards, so $100 of pay got you $120 extra of gift card or some such).

  FF points IMO are only worth it if you'll use them as flights / upgrades and were going to pay for them otherwise, as if you then try and buy a gift card the 'cost' is about the same eg ~20000 FF points = ~$100 while ~21,000 CBA points = ~$100. So when you convert you actually lose significantly on the convertible value.

  Personally I find the points too limiting given you can only book certain seats and then you're not eligible for status credits etc… In my mind the best value is the money you were going to spend anyway and thus is 100% savings, vs some theoretical saving on a flight you might not have booked / upgrade you might not have otherwise taken.

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    ilikedeals on 19/12/2018 - 20:52

    Ouch! $59 annual fee vs. $349!!!

    I guess the other option would be to covert points to Velocity FF, and either use as point upgrades or sell for 1.1-1.2c per point! From my calculations, redeeming for gift cards will give me about 8k worth of gift cards, whereas converting+selling the velocity points is worth about 9k

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      [Deactivated] on 19/12/2018 - 21:26

      Ow. you have $8k of gift cards worth of points backed up. :\ They only bumped up the cost of the $100 gift card from 20,000 to 21,000 points 6 or so months ago, I was annoyed as I just missed cashing one in, I haven't been letting them go more than a month past being eligible for another $100 card (the smaller cards are more points / $)

      Yeah, I signed up to the cheapest one as my spend at the time wasn't low enough to justify a higher annual fee, then back in the days when they could offer rate increases I took them, once I had the limit for the higher card they sent me a free upgrade, perhaps also not so coincidentally the week after I applied for another card at Bankwest which they could have easily known about….

      I guess the other question is how easy is it to sell points and how does it change the value equation if you include that effort / you can't sell them for what you thought / they get devalued in the mean time.

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  Diji1 on 19/12/2018 - 18:59

  So you lose $350, plus whatever unconscious loss the data collection and spending incentives creates, and in return you "earn" (it's totally not a loss guys, we're earning here!) tokens.

  The tokens are doled out in large numbers to make it seem like there's a lot of them and like they are more valuable than say using a dollar amount equivalent. You can spend the tokens on limited items from certain vendors.

  Seems like a great deal!

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    [Deactivated] on 19/12/2018 - 19:22

    Before they ditched the Amex and changed the rules I was making $400-600 of Coles vouchers on this every year for a $59 fee. Free travel insurance too (saving about as much as the fee per trip). Plus add to that average 30 more days of the balance offsetting the mortgage and it was definitely worth it compared with the alternatives.

    It's now down to about $200-300 a year, so wouldn't be worth the full fee unless your spend is something huge (eg large family).

    These days for most people fee-free accounts are probably the best value, next to 'free for the first year' offers with free points as long as you make sure you never-ever actually pay the fee.

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  R-Man on 19/12/2018 - 20:27

  +3

  As I understood it you cannot convert existing points to Qantas points? you can only opt in for future points to be converted qantas points?

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    ilikedeals on 19/12/2018 - 20:50

    Oh yes, that's correct!

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  littleburrito on 20/12/2018 - 14:05

  +1

  Converting all points to velocity will be the best option. I have quite a few points banked up and transferring them this week to Velocity and then to Krisflyer.

  You'll probably have at least 1,680,000 points if you can get $8k in gift cards. This will equate to 840,000 Velocity points. I saw a few post on OzB selling them for 1-1.2c each so that will get you $8400 (1c) or $10,080 (1.2c) if you want to sell them.

  Alternatively, you can transfer them to Krisflyer and you get the best value flying business class. 840,000 Velocity Points = 622,222 Krisflyer Miles. A return business class ticket requires 116,000 Krisflyer miles From Sydney to Singapore/Malaysia/Thailand/Vietnam/Hong Kong so you get about 5 return business class tickets with your points. If you prefer to go to Europe, it's 210,000 Krisflyer Miles so you're a few points short of 3 return business class tickets. You'll also have enough points to fly the new A380 First Class Suites. If flying business/first class isn't what you're after, you'll definitely get a lot of economy class tickets with the points you have but bear in mind points expires in 3 years.

  So I guess the question is - $8000 in gift cards vs 5 return business class tickets to Asia or 3 return business class tickets to Europe.

  Velocity to Krisflyer transfer is at a rate of 1.35 till 31 Dec. There will be a devaluation to 1.55 from 1 Jan so it'll be worthwhile organising the transfer soon if that's what you're after.

  • 

    ilikedeals on 20/12/2018 - 20:59

    Thanks for your detailed analysis and advice. I was not aware that Krisflyer Miles expire in 3 years.

    You are right - need to think about the transfer rate ASAP before it goes to 1.55 in a few days. Thanks again

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  R-Man on 03/01/2019 - 21:28

  What'd you end up doing?

  With my humble 22,000 points I got a $100 target gift card to probably spend on PlayStation games. Would have preferred JB but they don't offer that.

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    ilikedeals on 04/01/2019 - 06:40

    I'm going to cancel the card this month (was charged the annual fee in late November 2018, and was told you have 3 months to cancel and get a refund of the fees). I will just have to transfer to Velocity points as it gives slightly higher value than gift cards - that's assuming you can sell points for 1.2-1.3c pp, or redeem for upgrades (but I don't fly often..) - I'll have a shit load of velocity points from doing this.

    As someone rightly pointed out above, you can't convert CBA award points to QFF points as they don't allow retrospective conversion
    "

    • 

      R-Man on 04/01/2019 - 11:21

      Fantastic! My parents convert their CommBank points to velocity as well and recently they spent a large chunk on a Gold Coast holiday.

      They have the card "thrown in" as part of their home loan - otherwise they'd cancel this poor value card as well.

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        ilikedeals on 04/01/2019 - 12:34

        Yep, kinda pissed I’m paying $349 per year, I’ve paid for 8 years now…….