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The cost of QFF Points

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zig

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I don't earn that many points from flights, but do accumulate a lot by using my credit cards to pay for just about everything I can, and then pay the credit cards off each month. This has worked well for me in the past, however I have now noticed that a lot of bills include a surcharge of between 0.8% - 2% if you pay by credit card. This includes council rates, utilities, Optus etc.

This trend has me wondering if I am now paying too much for my points and I am wondering if any of you gurus who have more experience in this area could advise :?:
 

NM

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In my view it all depends on what you use your points for, and what you would have used that 0.8-2% surcharge money for if you didn't pay it to the biller?

Remember that if you plan on shifting your CC points to a program like Qantas FF, then your ability to redeem those points for your target award may be limited by the lack of status in the FF program. If you cannot redeem the points for something you want, then the value of the points is low.
 

lovetravellingoz

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Asa general rule if you are redeeming for economy domestic or international.....then if you are paying such a surcharge you wold probably be better off paying cash or electonic transfer.. (unless say you are justa few points short of an award...in whuch case it is cheaper than buying points.

domestic expensive...

up to

140,000 for RTW economy award....say wort $2800 plus. Say 2 cents per $ spent. there fore you need to be paying less than 2%.

Business class redemptions or upgrades are worth more.

TIP...often there is no charge for VISA...but is for AMEX...so free for life Citibank VISA with an earn rate of 1 is good for these occassions.



Now in my case.. my objective is not just to earn points.....but to make my life as comforatble as possible with maximum benefit for minimum cost.


so if I can get a discount for cash...I take the saving up front.

If they will not discount or deal (ie supermarkets, petrol...and other such fixed price purcahses such as school fees , rate etc) I pay by AMEX with its higher earn rate if there is no surcharge.....or Citibank VISA when there is for AMEX but not for VISA (or where they simply do not take AMEX).

If there is credit card surcharge of more than about 0.5% then I will pay by electronic transfer.


So for your case...do the sums and see what works best for you.
 

Hvr

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Of course if retailers were half smart they would realise the true 'cost' of cash. Afterall it has to be stored, counted and transported to a secure location. Easier to steal (staff and others) and just having it on the premises is a risk, if damaged it is genrally hard to replace.

One day when they realise just how expensive it is then there may be a discount for credit card. Already some organisations refuse to accept cash so maybe the tide is turning.
 

turtlemichael

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Hvr said:
Of course if retailers were half smart they would realise the true 'cost' of cash. Afterall it has to be stored, counted and transported to a secure location. Easier to steal (staff and others) and just having it on the premises is a risk, if damaged it is genrally hard to replace.

One day when they realise just how expensive it is then there may be a discount for credit card. Already some organisations refuse to accept cash so maybe the tide is turning.
You are missing the main reason why many retailers charge a credit card surcharge - because they can. And a majority of customers now expect and accept it. It's very little to do with the relative cost to the business of accepting cash.
 

thadocta

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The other consideration is the cost of NOT paying by credit card - most bank.building societies/credit unions have monthly transaction limits, and once those limits are exceeded you can be up for quite hefty fees. In my case, if I use my Visa card attached to my transaction account, it doesn't count as one of those transactions, if I pay the bill using Bpay or withdraw the cash to pay it in cash it does. If I have exceeded my monthly transaction allowance it will cost me $1.50, which is more than the credit card surcharge is likely to be.

Of course, everyone has different circumstances, but it is an additional factor which should be considered.

Dave
 

Dave Noble

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thadocta said:
The other consideration is the cost of NOT paying by credit card - most bank.building societies/credit unions have monthly transaction limits, and once those limits are exceeded you can be up for quite hefty fees.
I don't pay bank fees, but even if I did, there is no limit to internet transactions which can be performed without charge . $1.50 seems a bit high and evil for a transaction; my bank changes 60c for a cheque or eftpos transaction if the account does get fees

My main consideration for not using a CC to pay bills is that I don't have any personal credit cards :)

Dave
 

zig

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Thanks everyone for your input. I have generally been lucky when redeeming award flights and got what I wanted, but I do book well in advance and I generally redeem international business seats ( no point trying to use the points for an upgrade as I don't have status). Will keep monitoring the surcharges.
 
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