serfty said:
So to pay a 1% or 2% fine for using a CC and such points are used for an economy MEL-SYD flight may not make economoc sense; to use such points for a MEL-HKG trip may make more economic sense (but only if you have a use for a MEL-HKG trip).
I think that the summary by the OP illustrates their main point of this thread, "... I do not want to pay more to supposedly enhance what should be a free benefit gained from my loyal patronage."
I still look the more like this. If, in earning the CC points, I have paid an extra say $250 in surcharges, annual fee etc, then my upgrade has cost me $250. If the upgrade required me to surrender 25,000 points from my FF account, then the only value I can apply to those points is that they cost $250 and I redeemed them for a more comfy seat and better in-flight amenities.
I then need to consider if I am willing to spend $250 more than I would spend if I was paying with some other form of payment in order to have the points in my FF account to use for such an upgrade if and when it is available. My consideration is usually done on a case-by-case basis and generally results in me being willing to pay a small amount extra on the occasional transactions that demand a surcharge. And the only one I can remember in recent time is Telstra and each bill quarterly bill has included a surcharge of less than the cost of a beer at an airport bar.
So for me, the biggest cost in earning points on my Amex card is the annual fee which is higher than I could pay on some other cards. My personal value judgement is that I am willing to pay that higher annual fee in exchange for the points earning. I guess I could then value the cost of the points something like this:
If I pay an extra $200/year in CC fees for a high points-earning card like Amex Rewards Maximiser, and if I earn say 60,000 points in the year, then they have cost me about a third of a cent each - oh yes, and 4 beers for my four Telstra bill payment surcharges in the year. So extrapolating, that $200 could have purchased say 5 cases of reasonable quality beer at the local bottle shop, meaning my 60,000 points have cost me 4 x 24 beers, plus the 4 for Telstra bills making it an even 100 beers, or 1.67 mB/p (milli Beers/point).
Now that seems a much more logical way to value point to me :mrgreen:.