People often ask me whether it is worth paying the Amex fees for the sake of more points, so I have done some simple calculations:
Points needed for return flight Melbourne to Paris 1st Class Singapore Airways Suite Saver 296,000. Tax required $260.79.
For 296,000 KF points, one needs 296,000 Ascent rewards points from Amex (1:1 conversion).
To earn 296,000 Ascent points, one needs to spend $148,000 on Amex explorer. This assumes the Explorer card has been linked to the Ascent program.
My most expensive service provider (a builder) charges me a credit card service fee of 2.2%, so if I spend $148,000 on my Explorer, I will incur an extra cost of $3256.
Therefore, to fly return from Melbourne to Paris 1st class costs me $3516.79 ($3256 +$260.79 in taxes). To me this represents excellent value.
It actually costs a lot less than this – this is a worse case scenario. Many of my Explorer credit card fees are tax deductible and many only charge me a fee of 1.5%. Depending on my spending pattern, my actual cost for the above return flight is $2500 - $3000.