Credit Cards/Frequent Flyer Points/RTW Tickets

mxyzptik on 11/12/2012 - 18:57
Last edited 11/12/2012 - 19:23

In short: any ideas on the above for a low spending/infrequently travelling student?

The longer story: My son has read about people who have earnt frequent flyer points from credit cards and bought Round-The-World tickets with the points. He does not travel much & being a student doesn't spend much money. He is thinking of laying out $630 to buy credit cards for the bonus points. He's a finance student so its a good opportunity for him to learn about credit cards etc, but I don't want him to learn the hard way! I've just started looking into this & realise there are pitfalls, e.g. taxes make up a large proportion of fares, buying cheap fares can be better value than points-bought fares etc, having just read this: http://www.smh.com.au/executive-style/business-travel/blogs/…

Thanks for any tips.

Travel

Comments

  • DrStinge on 11/12/2012 - 19:43
    +1

    My personal favourite has always been getting a no-fee credit card and redeem the points to spend on groceries. Use the cash you saved on groceries to fund your fares/wares, not the absolute cheapest way but the less hassle + risk free.

    Laying out cash on credit cards for points seems a bit iffy (ie. it's forcing you to spend that cash? could be wrong here?); I'd personally just save the cash and go AirAsia / Scoot route. On the flip side I always feel credit cards for people with low income is a risky trap (having a sister + friends without self control), I only use my CC to delay the payment and collect interest on the fares.

    • mxyzptik on 11/12/2012 - 20:03

      Thanks DrStinge. On the one hand, I'm very wary of him effectively buying credit card points especially given his inexperience, on the plus side he can be fiercely disciplined. He says no money will go out of the door without me looking into it first. I'm presuming he thinks these particular bonuses for bought cards are better value than spending the money on purchases on a fee-free card as you suggested. I'll check it out. If he gets close to actually buying the cards I will post the details here first. Thanks again.

  • mskeggs on 11/12/2012 - 20:49
    +1

    A RTW ticket on Qantas FF is 140,000 points. The card I use gives me a point per dollar spent so the maths is pretty easy. Unfortunately, there is no magic answer.
    For more detail than he could possibly need, check out www.australianfrequentflyer.com.au/

    • mxyzptik on 11/12/2012 - 22:20

      Thanks very much mskeggs, I'll read it!

      • mxyzptik on 12/12/2012 - 00:43

        He told me that he will get over 120,000 ff points for his $600. I guess he will have to pay the taxes though which can be HUGE.

    • mxyzptik on 12/12/2012 - 01:00

      :). Wont be going to the FF store.

      • voteoften on 12/12/2012 - 01:19
        +1

        Maybe your son will and as a result won't be quite as clever. Just saying…

    • Geewhizz on 12/12/2012 - 07:05

      So then wouldn't you just pay the discounted economy fare and use the points for an upgrade?

  • [Deactivated] on 12/12/2012 - 06:46

    Suggest you read this article (3 parts)

    http://www.ausbt.com.au/get-the-points-the-best-value-qantas…

    That might help.

    But like the others I tend to use the points for gift cards and use the money I save there, to buy tickets where and when I want to go, at bargain prices from deals found here.

  • arend on 12/12/2012 - 09:44
    +1

    He's assuming he will be approved for all the credit cards…

    Big assumption for a low-income, low-spending student who's credit history will show him applying for a whole bunch of credit in a short space of time! Can't see it happening personally.

  • yoyo6 on 12/12/2012 - 09:50
    +1

    I am very curious how your son proposes to get 120,000 frequent flyer points for $600. The bonuses I have seen are never more than 30,000 points for signing up for a card and if he signs up for too many cards he will get rejected.

  • T Info on 13/12/2012 - 10:06
    +1

    Most CCs offering high amounts of sign-up points are gold/platinum cards which require proven income of $40K or more p/a. Applying for multiple cards in a short space of time doesn't help anyones credit rating, it raises flags.

    Also getting points is at times the easy part, booking redemption flights is often difficult, moreso on popular routes and anything involving interline carriage.

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