When the current crisis first started, none of us really knew what was coming and the scale of it. None of us know how long the travel bans will be in place and then when we will feel safe to travel. Most estimates are a minimum of 3-6 months, some up to a year (God I hope not!). With the airline industry facing what feels almost like insurmountable conditions, should you put effort into collecting more miles, points or Avios?
Nobody knows what the future holds for airlines, and although I will look at individual airlines below, there are some general tips to follow.
I plan to still collect Avios and Virgin miles for now. If you are concerned though, the safest way to collect miles would be to use something flexible where you can convert into the different airline or hotel schemes. American Express Membership Rewards cards such as the ones below offer transfers into schemes such as Avios, Virgin Flying Club, Air France, Hilton and Marriott.
Credit cards to consider are:
- American Express Platinum. This is expensive at £575 per year and you are unlikely to get the benefit of the travel perks, so I would recommend saving that for when the situation allows for travel again.
- American Express Preferred Rewards Gold credit card. This is a much better option as it is free and has a better earn rate on certain categories of travel. Until 29th June 2020, the sign-up bonus on Amex Gold has been doubled to 20,000 points. You need to spend £3,000 in 90 days to receive it.
- Marriott Amex card. This has the option to transfer your points to over 40 major airline frequent flyer programmes or use them on Marriott hotels.
- Tesco Bank which currently has 22 months at 0% for purchases. Tesco credit cards give Clubcard points which allows you to transfer into Avios or Virgin as well as spend in store.
Another option would be to switch to Topcashback for your online shopping rather than the BA or Virgin eStores. Topcashback allows you to convert your cashback into Avios with a 5% bonus or occasionally 25% bonus. Obviously there is a risk with less consumer spending, Topcashback may have difficulties. However, I believe that despite a decline in general spending the proportion going to online shopping will be higher than ever before meaning less risk. Quidco is another option although it does not offer Avios only cash or vouchers. It does offer Uber though with up to 8% bonus.
Another thing to consider is monitoring your expiry dates on all your different schemes. If you are grounded for a while you may find they start expiring. I will cover the rules and tips for each scheme in a later article. For now, I recommend using Award Wallet to track your miles expiry. I have 3 premium memberships to give away for the first three people who sign up with this link and use code: free-8gzm1qa282 (new users only). You can read more about it here.
British Airways and Avios
Out of all the airlines, British Airways and IAG are in one of the best situations financially to weather the storm. So much so that they indicated they were not in favour of a blanket government bailout. Whilst we may have complained about all the cost-cutting that went on under Mr Walsh, ironically it may be that which saves us! IAG had around €9 billion of liquidity at the start of the crisis which is a pretty good position to be in. So I am not concerned about them going bust.
Obviously nothing is certain, but I am not concerned that they are likely to go out of business any time soon. However, I would be thinking carefully about how I save my Avios.
Here are a few things to consider:
- If you want to cash out, the only viable option would be to buy wine. Given that you are unlikely to be able to travel soon, the airlines and hotel options would not work as if IAG went into administration, their partners would probably not be paid for the flights or hotels, so you would lose them anyway.
- If you wanted to buy wine, it’s a poor use of Avios but if you are Avios rich it’s an option. Many wine delivery services have stopped taking orders. It appears doing a dummy booking that you can still order via BA. Here is the relevant page
- If you have a BA Amex and want to save for companion voucher, time it carefully. The free card is valid for one year and the Premium card for two years. Given the current uncertainty, I would try and eek your spending out until the very last moment to hit the spend target.
- Avios expire after 3 years of inactivity on your account. If you need to stop that, some online shopping is a quick and easy way to earn some Avios without much spend.
Virgin Atlantic Flying Club
Out of the two, Virgin is the one that I actually have concerns about. Their route network has been decimated and 49% being owned by Delta also makes it more complicated. It does seem like the government are likely to offer a bailout to airlines, and the fact that they are also offering to cover employees salaries to a certain extent will help. Virgin miles are not even part of Virgin Atlantic but instead, part of Virgin Group Loyalty Company owned by Virgin Group and Delta.
I would probably avoid accumulating too many more miles in Virgin to limit your liability, although there are more ways to spend them on rewards that are instantly redeemable. This limits the possibility of your miles purchase not being paid for by Virgin such as partner flights. Options include Eurostar e-vouchers, Virgin Wines, Virgin IHG or Hilton points and Virgin experience vouchers. None of these are great value but if you need to cash out, you may not care.
Unfortunately, you need to redeem by phone so it’s unlikely you will be able to do this for at least a couple of weeks if you want to cash out.
Most hotel groups are asset-light and have such a global spread that I am not concerned about the possibility of losing points. Many such as Marriott offer a lot of points transfer options into airlines if you felt you needed to cash out.
British Airways closes all lounges in UK
Earlier in the week we reported that BA had closed all lounges at Heathrow except the Galleries Club and First South lounges and T3 lounges. BA have now announced that all BA operates lounges in the UK are to close following the government’s advice on Friday. I’m not entirely convinced of the wisdom of this. With all other bars and restaurants shut, my worry is that people will congregate around their gate in close proximity to each other. Although at least they won’t all be touching the same bottles of wine and drinks I guess.
Disclaimer: TLFL does not feature all offers, credit cards etc and readers should do their own due diligence. Any credit cards featured are discussed solely in terms of the travel benefits to the reader and should not be construed as financial advice.