Mistakes to avoid with a frequent flyer credit card

Information verified correct on October 26th, 2016


Frequent flyer credit cards can offer massive benefits, but you’ll need to avoid these pitfalls to get the most out of your rewards card.

If you’re in the market for a frequent flyer credit card, you know how the benefits can help reward you for your everyday expenses. However, you might not be aware of some of the mistakes you’ll need to steer clear of to get the most out of your card. So you know what to look out for, we’ve curated this short list of the major pitfalls you’ll need to avoid when using your frequent flyer credit card.

1. Choosing the card only for its rewards

credit-card-holderEven if you want a credit card specifically to earn frequent flyer points, it’s important to look at features such as the annual fee, interest rate and terms and conditions to make sure it is a card that will work for you. It’s easy to become distracted by the benefits offered by frequent flyer credit cards, but try to look beyond the points and also compare your options based on how the card will work for you as a financial product. Start comparing frequent flyer credit cards today.

2. Not factoring in points caps

points-earningSome frequent flyer credit cards limit the number of points you can earn per month or per year. For example, the NAB Qantas Premium credit card has a points cap of up to $50,000 per statement period. If you use your credit card regularly, these points caps can take value away from the card by preventing you from earning as many points as you can. Worse still, if you’re not aware of the cap before you apply, you could end up with a card that’s less than ideal for your circumstances, so always check for this feature before you apply.

3. Missing expiration dates

credit-card-expirationSome frequent flyer reward programs and credit cards points are limited by an expiration date. For example, Velocity Points will expire if your account isn’t active (meaning if you don’t earn or redeem any points) for 36 months. Once your points have expired, you can’t get them back. Whether it is 12 months or 3 years, this deadline is important if you want to get full value out of all the points that you earn, especially if you’re saving up for a major reward. Easiest way to manage your point expiration dates? Schedule them into your calendar with a reminder 1-2 weeks before expiring.

4. Skipping the fine print for signup promotions

card-terms-and-conditionsSignup promotions such as bonus points and halved or waived annual fees add a lot of value to the card you choose in the short-term, but there are requirements you need to meet to take full advantage of these features. With bonus points, for instance, you usually have to spend a set amount of money in the first few months from when the card is approved. Meanwhile, a halved or waived annual fee is only offered for new customers for the first year, so if you get a card without realising this is a signup feature, you may have a nasty surprise waiting for you when the second year comes around. Annual fee waivers can also continue with an annual spend requirement e.g. $0 annual fee after spending $10,000 in a statement year. To avoid missing out on extra value, make sure you read over the T&Cs before applying.

5. Overspending


Frequent flyer credit cards reward you for every dollar you spend, which could tempt you to spend with the incentive of racking up rewards. Remember that you have to repay everything you charge, and in most cases, plus interest. If you don’t pay off the balance in full every month, you’ll end up in some serious credit card debt which will counteract the value of your rewards.

Learn how to get rid of your credit card debt on this article.

6. Using your card for ineligible purchases

card-transactionNot all purchases on your credit card will accrue frequent flyer points. For example, balance transfers, cash withdrawals, BPAY transactions and government payments are all examples of charges that typically don’t collect points. If you regularly use your card for these types of transactions, consider how many points you’ll actually earn on day-to-day expenses to determine whether the card is of value to you. If you’re not sure what is considered an eligible purchase, check your card’s product disclosure statement for a complete list of exclusions.

7. Redeeming the wrong rewards

flightsWhat you want to get out of your frequent flyer credit card is ultimately up to you, but some redemption choices will offer you better value than others. For example, you’ll find that redeeming your points for flights with an airline offers better value than if you redeem a product from the airline’s rewards store. While you might need 16,000 Qantas Points from your Qantas Frequent Flyer credit card for a return economy flight from Sydney to Melbourne, 16,080 points will only get you an Event Cinemas Gold Class double pass package from the Qantas store. Consider that if your credit card has an earn rate of 1 point per $1, then you’ll be redeeming $16,000 worth of points for movie passes.

Frequent flyer credit cards can offer a myriad of benefits, but one missed T&C or wrong purchase could mean you’re limiting the value you could get from your card. Use this guide and you’ll have no trouble sidestepping some of these errors when it comes to managing your frequent flyer credit card.

Sally McMullen

Sally McMullen is a journalist at finder.com.au who is a credit cards and travel money expert by day and music maven by night.

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Credit Cards Comparison

Rates last updated October 26th, 2016
Purchase rate (p.a.) Balance transfer rate (p.a.) Annual fee
Virgin Australia Velocity Flyer Card - Balance Transfer Offer
Enjoy a 0% p.a. balance transfer offer for 18 months and also earn 2 bonus Velocity Points in the first 3 months on everyday spend.
20.74% p.a. 0% p.a. for 18 months $64 p.a. annual fee for the first year ($129 p.a. thereafter) Go to site More info
ME Bank frank Credit Card
Enjoy a low and consistent interest rate on purchases and cash advances, combined with no annual fee.
11.99% p.a. $0 p.a. Go to site More info
HSBC Platinum Credit Card
Receive a full annual fee refund and save $149 if you meet the $6,000 spend requirement. Enjoy a balance transfer offer and platinum card benefits such as complimentary insurances and concierge services.
19.99% p.a. 0% p.a. for 15 months $149 p.a. Go to site More info
NAB Low Rate Credit Card
The NAB Low Rate Card offers 0% p.a. on purchases and balance transfers for 15 months. This card also comes with a low annual fee.
0% p.a. for 15 months (reverts to 13.99% p.a.) 0% p.a. for 15 months with a one off 3% balance transfer fee $59 p.a. Go to site More info

* The credit card offers compared on this page are chosen from a range of credit cards CreditCardFinder.com.au has access to track details from and is not representative of all the products available in the market. Products are displayed in no particular order or ranking. The use of terms 'Best' and 'Top' are not product ratings and are subject to our disclaimer. You should consider seeking independent financial advice and consider your own personal financial circumstances when comparing cards.

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