For shoppers looking for ways to make their money grow, a rewards credit card has always been touted as a quick win.
Yet, with Sainsbury’s Bank reducing its points supply from November, are these cards still worth it?
The answer is potentially “yes” if you’re willing to use them for all your daily expenses.
Reward credit cards offer shoppers cash back or rewards points for every pound they spend – but there are pitfalls
But there are pitfalls to watch out for – the biggest being a fee of up to 104% APR if you don’t repay the debt in full each month, wiping out any potential gain.
Here we’ve looked at the best cards for households spending £1,000 a month…
Ideal for… Money in your pocket
For those only interested in cash rewards, the Amex Platinum Cashback Everyday Credit Card offers a healthy welcome bonus of 5% cashback in the first three months, worth up to £100 .
Once the introductory offer ends, you’ll earn 0.5% cashback on spend up to £10,000 per year, and 1% beyond that.
You will need to spend at least £3,000 per year to earn cashback. Putting £1,000 a month on the card for a year would net you a total of £160.
The Amex Platinum Cashback credit card works best if you spend more than £10,000 a year.
It comes with a 5% bonus offer – capped at £125 – in the first three months, and higher payout rates of 0.75% up to £10,000 and 1.25% at -of the.
The cashback is paid annually. The annual fee is £25, but those who put £1,000 a month on the card would get £206.25 in bonuses.
Best for… Points to spend in-store
Amex Preferred Rewards Gold offers a bonus of 20,000 membership points when you spend £3,000 or more in the first three months.
This is in addition to a base earn rate of one point for every £1 spent (excluding certain transactions such as currency purchases).
Hot deal: For those interested in cash rewards, the Amex Platinum Cashback Daily Credit Card offers a welcome bonus of 5% cash back for the first three months, worth up to £100 .
After spending £1,000 a month for a year, you would have a total of 32,000 points including the welcome bonus.
From October 12 you can also get a bonus of 5,000 points for spending £10,000 in your membership year.
The advantage of Amex points is that they are versatile – you can redeem them at High Street stores, airlines and hotels.
Around 30,000 points can be redeemed for gift cards worth around £150 at Currys and Selfridges or you can use them to pay for £135 worth of purchases on Amazon.
You get more value for your points by redeeming them with Amex’s travel partners, including BA, Virgin and Eurostar.
Around 33,000 points can earn rewards such as a night at a luxury Marriott Bonvoy hotel or a round-trip economy class flight to Los Angeles with Virgin Atlantic.
To redeem Amex points for flights or vacations, you’ll need to convert them to points on a different program, such as Avios, Virgin Atlantic Flying Club, or Hilton Honors.
There are also other benefits, such as £5 off Deliveroo purchases twice a month, plus two free visits to an Amex airport lounge (four from October 12).
The card is free for the first year. After that there’s a £140 annual fee, but you can cancel the card before it starts.
Members can keep their points after cancellation if they have converted them into another points currency, such as Avios.
Ideal for… holidaymakers
Takeoff: The British Airways American Express credit card is a good option for earning Avios points, as well as booking a free flight for a family member or friend.
The free British Airways American Express credit card is a good option for collecting Avios points, as well as booking a free flight for a family member or friend.
You earn one point for every £1 spent, plus a £5,000 bonus if you spend £1,000 within the first three months of signing up.
Spending £1,000 a month for a year would net you 17,000 Avios points, almost the 18,500 point threshold for a £1 Reward Saver return flight to a European destination.
As well as Avios points, you get a free companion voucher for spending £12,000 a year, which you can use to take a relative or friend with you on the same flight in economy class.
Or if you’re traveling alone, you can opt for a 50% discount on the Avios price you pay for your flight.
You will always be charged taxes and carrier fees on flights.
More serious Avios collectors with big monthly spend should consider the Premium Plus card, which gives you 1.5 Avios for every £1 spent.
You’ll also get a free companion voucher when you spend £10,000 a year, and your partner or friend can travel in the same cabin if you book a premium or business class seat.
This has an annual fee of £250 and interest on purchases is charged at 26% if you don’t pay your balance in full each month.
The card’s APR — an industry-wide metric designed to help customers compare the cost of credit, which takes into account its interest charges and fees — is 103.7%.
Ideal for… your weekly magazine
Loyalty rewards: Tesco Clubcard points can be redeemed for three times their value from its rewards partners, worth £45
Shoppers loyal to Tesco and Sainsbury’s can withdraw cash for purchases using the store’s own credit cards.
With the Tesco Bank credit card you can earn five points for £4 spent at Tesco and one for £8 spent elsewhere. Spending £1,000 a month outside of Tesco would earn you up to 125 Clubcard points, worth £1.25 or £15 a year.
Clubcard points can be redeemed for three times their value at its Reward partners, worth £45.
Sainsbury’s Bank credit card is set to change its points system to give one point for every £2 spent at Sainsbury’s, Argos, Habitat and Tu Clothes – in addition to its usual points awarded for using a Nectar card.
Don’t be tempted to spend too much to get bonuses. But add a family member or partner to your account to earn cashback faster.
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