As Australians we love to travel! In 2015, ABS reported over 9 million overseas departures from Australian citizens – that’s a lot of movement for a small populated nation.
Are you travelling in 2016? I can safely expect millions of Australian’s are raising their hands, dreaming of their incredible and luxurious adventure awaiting them this year. Travel is clearly part of our Aussie DNA. With our strong salaries and GDP we love to get abroad, experience cultures, and educate others on how we ride kangaroos to work.
Most of us fly in economy, but that’s not your reason for visiting this blog… You want what we all deep down are seeking: that flat sky-bed jet-setting lifestyle of lounges, champagne and personal in-flight pampering. Well this guide is for you!
Grab a cup of coffee, a notepad and pen and let me show you how anyone can fly business class – without paying business class fares!
In this guide, I will show you how to travel hack your way to the pointy end of the plane through shifting your mindset about points, reallocating your same spend through the right sources to earn more, and understanding how points work at maximum value.
If you enjoy this guide please follow me on Instagram (I’m going to be posting a lot more about business class, first-hand reviews, news and exclusive tips here!) and if you’re an active traveller and dread jet lag – I recommend checking out my How to Beat Jet Lag kindle eBook. You can read it on your phone, tablet or kindle!
1. Understanding the value of Qantas points
You wouldn’t waste your hard earned money intentionally, so why would you waste your points? This is the first thing you need to understand: points are a currency. Like all trading currency, points have an exchange rate value that fluctuates by the Reserve Bank (Qantas Loyalty HQ in your case) and from the general supply and demand of exchange.
So how much are frequent flyer points worth? The answer is, it depends.
Qantas (our Reserve Bank) can decide to reduce the value of points overall, however, this has only been done a few times and in small moderation. The driving force of loyalty is the mass consumer expectation and consumption. Qantas also needs their loyalty program to remain successful, as it’s a great asset to the airline group.
The value of you points all depends on what you buy with them. The most common waste of points is redeeming products in the Qantas store. A $100 MYER gift card on the Qantas store is going for 16,600 points. That’s a point value of 0.6cents per point.
Let’s compare that to purchasing a domestic economy ticket from Brisbane to Melbourne and then upgrading that ticket to business class through Qantas Classic Upgrade feature. The cost of a generic ticket is $145 on a Red e-Deal. The cost of the business ticket is a whopping $960!
Click on the tiny info icon next to the fare type (in this case where it says Red e-Deal in the red box). A small pop-up window will appear. Scroll down to read the terms and conditions for the Qantas Frequent Flyer section.
Each type of fare has a ranking in value of the points needed to upgrade. Because Red e-Deal is classed as Discount Economy, we know to use that option in the calculator (image below). If we booked a Flex Fare, we would only need 7,500 points to upgrade. Understanding fare types is important when booking flights for cash.
So we have a different of $815 dollars between economy and business. If we use a points calculator (I like to use PointsHack one its free and easy!) we can find that the 15,000 points required to upgrade will give us a points value of 5.67 cents per point. A huge difference to the 0.6cents for exchanging the gift voucher!
Let’s take this a step higher and apply to a fully paid international fare (since we really want to get overseas here! No offence Melbourne). A generic ticket price from Sydney to Singapore is $680 on a Saver Fare (classed as economy in the calculator). The price for that same flight in a fully paid business class seat is $2460.
If we instead used our points, we would pay 60,000 points + a tiny fee in Taxes. Our flight is basically FREE – and our points value sits at 4.41cents per point. 🙂 Winning! NOTE: This is during a cheap season in flying, where the average price of a business class ticket sits commonly in the $3000 range.
In summary, let’s take a look at the three uses of our points and how they matched up. I also added in a Apple TV and a First Class classic reward to Dubai…(for anyone who wants to go all out!)
Tip: Got a question about points? Just Tweet me here and I will answer!
As you can see from above, the value of points changes depending on what you use it for. As a general rule of thumb the higher quality the class jump, the better value you will receive. It’s important to remember that buying a flight redeemed fully in points is better value than buying a ticket in cash and requesting an upgrade. Requesting an upgrade is also a bidding process, so you’re not always guaranteed you will win the seat.
The best part about points is they are a fixed rate, so no matter the fluctuation in prices – points are the same price everyday! Airlines use a algorithm too in awarding seat availability for Qantas Classic Reward seats (that’s code for full redemption of a fare with points). This algorithm means when you are searching for a flight using points, if you don’t see availability one day – check back the next day and you will most likely receive different results. Each flight availability is different based on the popularity and supply-and-demand of the route.
Paying for business class will cost on average 4 to 5 times the rate of an economy ticket, but with points it’s only double the amount.
As business class becomes more and more popular and the demand grows, so does the cost…
Your points, are the #1 bridge between economy, and your dream seat in business.
Most Australian’s don’t understand the real value Frequent Flyer points have… They tell themselves “I will just be nice to the cabin crew and hope for an upgrade” – but those are rare cases! The other alternative is buy so many fares with an airline to move up the expensive loyalty ranks and pay to be up the front end of the plane… That’s an expensive plan also. Your best plan of flying flat is to simply strategise your points for optimal accumulation and use them to redeem your way to the front.
2. Setting a points goal
When you set out to buy a car or a house you enter a stage of dreaming and research before the actual purchase… It’s important to do that same with points! Travel is something very personal and valuable for many. It’s the experience of freedom, culture, luxurious pampering, time spent with family or loved ones, and so on.
Setting a goal will help you get clarity and enable you to create a strategy to get you there faster. So – what’s your dream destination? It could be almost anything! Here are some personal examples to get you thinking:[Small goal] Upgrade seat to business from Melbourne to Brisbane. 15,000 points
[Medium goal] Two economy tickets Brisbane to Sydney return. 32,000 points
[Medium goal] One way business class ticket to Hong Kong from Brisbane. 60,000 points
[Large goal] One way ticket for myself first class Sydney to Dubai. 144,000 points
[Large goal] Business class return ticket to Tokyo for myself and fiancé. 288,000 points
Points are incredibly valuable, here are some of my favourite reward flights of good value:
Brisbane/Sydney to Singapore – 120,000 points return Business class
Retail price average: $3900-$4500
Brisbane/Sydney to Honolulu (Hawaii) – 72,000 points return Economy
Retail price average: $1700-$2300
Brisbane/Sydney to Hong Kong – 120,000 points return Business class
Retail price average $4100-$4800
Sydney to Dubai – 144,000 points one way First Class
Retail price average $11,000-$13,500!!
Once you have a goal destination in mind, you can research the points required. It’s important to get vision and clarity on your goal so you can visualise and save up (instead of wasting points on minor redemptions!)
I’ve attached a points saving goal PDF for free! Download it – Print it – Fill it out! Stick it on the home office pinboard or fridge for reference and reminder.
3. Finding the right credit card
Credit cards are your best friend for earning points. While some Australian’s avoid credit cards because of a fear of them, the truth is if you manage your credit card appropriately you will hold a great credit rating AND get value back from everyday spending. Using a credit card is simply to reroute your spending through a source that will earn you points – not change the amount you’re spending.
Each year, people from all levels of demographic spend thousands of dollars per year (and for some hundreds of thousands) on fuel, food, bills, gifts and everything in between. Sadly if you’re not using a credit card – thousands of points could be wasted.
The general rule for travellers of multiple airlines is to find a credit card that has a reward system where you can transfer points into multiple airline type miles/points. American Express and ANZ Rewards are some of the best for Australia, however, we will focus on Qantas only cards.
Bonus points are big advantage
Many credit cards upon signup will reward you with bonus points. In 2016 we saw many great signup bonuses such as the Amex Premium 80,000 Qantas points offer. The most common bonus points offers are between 25,000 and 70,000 points depending on the card level.
There are some cards such as the American Express Qantas discovery card which will offer you around 7,500 bonus points, but this card has zero annual fee and is an extra level card. On the other side of the scale, AMEX and ANZ are also running 75,000+ points offers for cards that will require you to spend more and earn more.
Bonus points are the best way to overshadow an annual fee in value and get you flying faster to your dream destination.
In a nutshell, there’s a type of card for everyone and every level of spending! Before applying for a card you should consult someone with financial accreditation for advice (this blog is not accredited financial advice!). It’s important to decide on your credit limit, and find a card that fits your income and monthly spend.
Credit cards to consider
There are many Qantas partnered credit cards with the big banks, here are some of our recommended options to look at…
American Express Qantas Cards
Free lounge passes, high points per dollar earnings and complimentary insurance – welcome to the world of Amex! In recent years American Express have strengthened their presence and availability in Australia, along with more rewards card options and competitive offers.
There are 3 types of Qantas cards you can obtain through Amex Qantas rewards:
– Discover card
– Premium card
– Ultimate card
The discover card has zero annual fee and offers a 1:1 ration on points with a small bonus sign up. The Premium card [click for referral] has an annual fee of $250, but includes better points, complimentary travel insurances and guest invitations to Qantas lounges. The ultimate card (for the big spenders) hosts a range of premium features and has an annual fee of $450.
One of our favourite cards currently is the American Express Qantas Premium card. With a referral you can currently get enough bonus points to fly you to Singapore! Amex runs great signup bonus offers each year so keep an eye out on this blog for the next one! Last years offer was a whopping 80,000 points!
Benefits of American Express:
- Great bonus points offers
- High earnings of points per dollar
- Bonus points earned on Qantas products
- Complimentary travel insurance (selected cards)
- Lounge invitations (selected cards)
- Amex invites
- Amex offers (learn more about here)
- Purchase & Refund protection
- Apple Pay compatible!
ANZ Rewards Cards
ANZ has a popular frequent flyer reward scheme that consists of three levels of cards; the ANZ Classic, ANZ Platinum and the ANZ black card. You will find throughout the year ANZ runs large campaigns offering huge bonus points and zero annual fee signups (for first 12 months). In January 2016 they are currently offering 75,000 bonus points and waived annual fees for the ANZ Black card. Click here for more info.
If you are an ANZ banker, it’s common to choose these cards over amex out of simplicity of already owning a ANZ bank account. ANZ offer good customer service (especially via social media) and they have a simple an effective mobile app for tracking expenses.
One of the best features of ANZ Qantas credit cards is they offer you two cards – one visa and one amex. This means if AMEX isn’t accepted, you can use the Visa and still earn points.
The entry level ANZ Classic card gives a 1:1 point earning ratio on the AMEX and 0.5p/$1 on the visa, while higher level cards commonly offer 0.5points higher and also include complimentary travel insurance and other benefits. The Anz Black card includes uncapped points and complimentary Qantas club membership (which standalone covers the annual fee in value!)
Remember this is not personal financial advice and you should always read the T&C’s of a credit card before signing on. Applying for a credit card multiple times and failing (because you did not meet criteria) can affect your credit rating – so we suggest reading the terms to ensure you are eligible to apply!
For detailed credit card reviews and insights, we highly recommend you visit our friends at PointsHack.com.au and use their credit card referral links when signing up.
Rerouting fixed expenses through credit cards
Our aim for earning points with credit cards is not to change your spending limit, instead we want to change the behaviour of how you spend and where. Take a moment to think about expenses in your world that could be run through your credit card… You would be surprised at how many providers now accept American Express, and how many don’t charge a surcharge.
To give an example: You can pay fixed bills such as your RACQ insurance through an AMEX with zero surcharge.
When you add in subscriptions, insurances, groceries, fuel, gifts and dinning – you will be surprised at how quickly you can grow your everyday spending into everyday points!
The aim of credit cards is to work our your spending, then switch that spending to your new cards that earn points. Remember to pay your bill off at the end of each interest free period!
4. Benefit from reward initiatives.
There’s multiple ways to earn Qantas points outside credit card spending that can help you boost your points! It’s important to be aware of the various ways you can earn points so you know how to switch your behaviour in everyday purchases or situations. For example, you can earn points dining, paying insurance or even searching the internet. Here are a few alternative ways to earn points:
- Qantas dining
- Qantas Epicure (buying wine)
- Shopping online
- Exchanging money
- Buying QBT travel insurance
- Hiring a car
- Catching a taxi
Example A: I bought some shoes through David Jones recently. I saved money by grabbing the product online, while also earning 6 points per dollar spent when I used the Qantas Mall. The total cost was $100, which I paid for with my Amex earning 1:1 points – therefore 100 + 600 points = 700 points for just rerouting my shopping online. My shoes came 2 days later with free delivery!
TIP: Keep an eye out for Qantas double points weekends on the mall!
Example B: Last year I helped a business setup to new macs. Qantas ran a 3 points per dollar promotion through the mall on all Apple products – I ended up earning over 12,000 points in one hit!
What’s something you are buying this year? New iPhone? New Camera? New Dress? Qantas has hundreds of shopping partners, from Bonds, to The Iconic, and even eBay purchases. Start shifting your thinking to online.
5. Enjoying the benefits
It’s time to book and redeem! It’s worth using tools such as RouteHappy or SeatGuru to pre-plan what type of plane you will jump onboard. As we talked about before, each destination and type of upgrade will vary in quality and cost. If you need help booking your seat there’s a great service called iFlyFlat worth checking out!
Now, sit back and enjoy your Qantas flight! Be sure to make use of the complimentary Qantas and Partner lounges available and tweet us your travel photos!
Enjoy being this guy…
And not this guy:
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