These frequent flyer credit cards have a $0 annual fee

These frequent flyer credit cards have a $0 annual fee

Want something for nothing? There are five credit cards that give you just that – provided you pay off your entire bill each month.

Between them, American Express, BankVic and HSBC have five frequent flyer credit cards that don’t charge annual fees (see table below), according to a RateCity analysis of the credit card market.

So if you limit yourself to spending that you were going to do anyway, and if you make sure you always repay your debt during the interest-free period, you’ll accumulate frequent flyer points without burning money on extra purchases, fees or interest.

There are also another four credit cards – from Westpac and HSBC – that entice customers with a $0 annual fee in the first year, before charging an annual fee from year two onwards.

Provider Card Annual fee Interest rate (ongoing) Interest-free days (max.) Points per $1 spent (max.)
American Express Essential Credit Card $0 14.99% 55 1.25
BankVic Qantas Visa Credit Card $0 16.95% 55 2
HSBC Premier World Mastercard (Rewards Plus) $0 19.99% 55 1.5
American Express Velocity Escape Card $0 20.74% 55 1.75
American Express Qantas Discovery Card $0 20.74% 44 1.75
HSBC Platinum Qantas Credit Card $0 for 12 months than $79 19.99% 55 1

Westpac

Altitude Platinum Bundle (Altitude Rewards) $0 for 12 months than $150 20.49% 45 3
Westpac Altitude Platinum (Altitude Rewards) $0 for 12 months than $150 20.49% 45 1
Westpac Altitude Platinum (Altitude Qantas) $0 for 12 months than $150 20.49% 45 0.5

Credit card comparisons are hard

Comparing frequent flyer credit cards can be tricky, because it can be hard to work out how many points you are likely to accumulate through your regular day-to-day spending.

For example, the American Express Qantas Discovery Card has three different earning rates:

  • 1.75 points per $1 spent with Qantas
  • 0.5 points per $1 spent at government bodies in Australia
  • 0.75 points per $1 spent on all other purchases

credit card stack 2

Another thing that makes comparisons hard is that there are not one but two main frequent flyer programs – Qantas Frequent Flyer and Velocity (linked to Virgin).

Just as 1 Australian dollar and 1 American dollar have different purchasing power, so do 1 Qantas point and 1 Velocity point. For example, a Sydney-Melbourne one-way ticket costs 8,000 Qantas points and 7,800 Velocity points (plus any additional taxes, fees and carrier charges).

To make things even more complicated, while some credit cards allow you to directly earn Qantas or Velocity points, others give you their own in-house points, which you then have to convert into Qantas or Velocity points.

For example, every $1 you spend with the HSBC Premier World Mastercard (Rewards Plus) will earn you up to 1.5 HSBC Rewards points. It then takes 2 HSBC Rewards points to ‘buy’ 1 Velocity point.

So $1 spend = up to 1.5 HSBC Rewards points = 0.75 Velocity points.

Don’t fall into this credit card trap

One trap some people fall into is buying things they wouldn’t otherwise buy, in the belief they’re ‘making money’ with these extra purchases because they’re earning frequent flyer points.

Frequent flyer points are only ‘free money’ if your credit card doesn’t cost you money to hold. That means not making extra purchases, not paying fees and not paying interest. If you meet those three conditions, then, yes, you really are getting something for nothing.

Money trap

However, making extra purchases just to earn points is the exact opposite of ‘free money’, because the amount you have to spend exceeds the amount you get back.

Take the BankVic Qantas Visa, for example, where everyday spending will earn you 0.5 Qantas point per $1.

Imagine you wanted to accumulate enough Qantas points to get a free flight from Sydney to Melbourne. In that case, you would need 8,000 points – and to save that many points, you would need to do $16,000 of everyday spending.

Effectively, then, you would need to spend $16,000 with your BankVic Qantas Visa to get a Sydney-Melbourne airfare.

However, if you were to buy the ticket with money, rather than points, it would cost just $149.

That isn’t to say the BankVic Qantas Visa is a bad frequent flyer credit card. Rather, using it (or any other card) to ‘buy’ points is a very expensive idea.

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Learn more about credit cards

What is the CUA credit card increase limit process?

A credit limit is pre-assigned based on factors like your income, expenses, and debt by the card-issuing company. It varies from time to time based on credit utilisation and changes to your circumstances.

If your income has increased or your liabilities have reduced, you can request for an increase of your CUA credit card limit. You can lodge the request via online banking on the website, or by visiting the closest branch, or by downloading the application form and mailing it. While making the application, you may need to provide information about your income, employment status, desired limit, and the reason for the increase. The card-issuing company will assess your request before approval.

Before you apply for an increase to the credit limit, ensure your bills are paid in full and you aren’t asking for a very steep enhancement.

What does Westpac credit card insurance cover?

If you own a Westpac credit card, one of the perks may be  free travel insurance. If you’re eligible, you may be covered if you get sick while travelling, have lost your luggage, have to cancel a trip or have an accident while you’re on the move.

Besides these standard inclusions, the Westpac credit card insurance policy may also cover you for hospital essentials, emergency dental treatment and alternative transport if your original plans go awry. It may also cover loss of income when you get back home after being sick  overseas and your pets’ boarding costs too.

If you have any queries, the Westpac credit card insurance contact number is 1800 091 710. You can submit a claim online.

 

How can I increase my credit card limit on my American Express card?

If you want to increase the credit limit on your American Express (AMEX) credit card, you will need to apply through the AMEX Online Services, or by calling the number on the back of your card. You may need to share personal information that the bank can use to assess whether the requested limit is suitable for you and your current financial status. Once your application is approved, your new limit will be ready for use within an hour.

How to increase my Commonwealth credit card limit?

Commonwealth Bank credit cards are extremely popular in Australia for everyday purchases and big ticket items alikers. A number of the card’s functions can be customised, depending on your needs and desires. If you wish to increase your Commonwealth credit card limit using the CommBank, you can usually do so on the app or via NetBank.

In the CommBank app, tap on the ‘Cards’ icon and choose your credit card. Then, click on ‘Credit Limit’ and select the ‘Increasing your limit’ option. If you don’t have the CommBank app, you can also increase your Commonwealth Bank credit card limit through NetBank. Simply log on and go to Settings, then click on ‘Product Requests’ and then choose ‘Credit Card Limit Changes’. 

Once the bank has received your application, they will review your account and payment history. Based on this assessment, your application will either be approved or denied. If approved, your new limit will be applied to your card instantly. 

While increasing your credit card limit may be an easy process, it’s important to remember that you should only request limits that you can manage. A high limit increases the risk of having a larger debt, even with cards that provide low-interest rate options. So, it’s important to think carefully and seek advice from people you trust before increasing your Commonwealth Bank credit card limit.

Can a pensioner get a credit card?

It is possible to get a credit card as a pensioner. There are some factors to keep in mind, including:

  • Annual income. Look for credit cards with minimum annual income requirements you can meet. 
  • Annual fees. If high fees are a concern for you, opt for a card with a low or $0 annual fee. 
  • Interest rate. Make sure you won’t have any nasty surprises on your credit card bill. Compare cards with a low interest rates to minimise risk.

What's the best credit card for rewards?

There is no one-size-fits-all best rewards credit card. It's best you research what type of rewards program you'd like, as well as the fees, interest rate and conditions associated with those types of cards before making a choice. 

Rewards credit cards can also come with high annual fees that may end up nullifying the rewards, so think how often you use the card to decide whether the benefits outweigh the extra cost for you. A card with a lower annual fee might require a lot of spending to get any useful rewards, while another card with a higher annual fee might need fewer purchases to get a reward. 

How easy is it to get a credit card?

For most Australians, there are no great barriers to applying for and getting approved for a credit card. Here are some points that a lender will consider when assessing your credit card application.

Credit score: A bad credit score is not the be all and end all of your application, but it may stop you being approved for a higher credit limit. If your credit score is less than perfect, apply for the credit limit that you need, rather than the one you want.

Annual income: Most credit cards have minimum annual income requirements. Make sure you’re applying for a card where you meet the minimum.

Age & residency: You need to be at least 18 years old to apply for a credit card in Australia, and most require that you are an Australian citizen or permanent resident. However, there are some credit cards available to temporary residents.

How do you use credit cards?

A credit card can be an easy way to make purchases online, in person or over the phone. When used properly, a credit card can even help you manage your cash flow. But before applying for a credit card, it’s good to know how they work. A credit card is essentially a personal line of credit which lets you buy things and pay for them later. As a card holder, you’ll be given a credit limit and (potentially) charged interest on the money the bank lends you. At the end of each billing period, the bank will send you a statement which shows your outstanding balance and the minimum amount you need to pay back. If you don’t pay back the full balance amount, the bank will begin charging you interest.

How do you cancel a credit card?

It’s important to cancel your old cards to avoid any additional fees. Unless you’re doing a balance transfer, you’ll need to pay the outstanding balance before you cancel your credit card. If you’ve opted for a card with reward points, make sure you redeem or transfer the points before you close your account. To avoid any bounced payments and save yourself an admin headache, redirect all your direct debits to a new card or account. Once you’ve done all the preparation, call your bank or credit card provider to get the cancellation underway. Once you receive a confirmation letter, destroy your card and make sure the numbers aren’t legible.

How many numbers are on a credit card?

The numbers on your credit card actually follow a universal standard which is used to identify specific functions. Each credit card has a different amount of numbers. Visa and Mastercard have 16, American Express has 15 and Diner’s Club has 14. 

The first number on a credit card always identifies what type of credit card it is. Visa cards start with a 4, whereas Mastercard starts with a 5 and American Express with a 3. The remainder of the digits represent the account number, including the last number which is used to verify that your credit card is actually valid. 

Credit cards also have additional verification numbers, which are mainly used when the card isn’t present for phone and online purchases. These are the three-digit numbers on the back of Visa and MasterCard or the four-digit numbers on the front of an American Express card.

How to get a free credit card

There's no such thing as a free lunch. All credit cards come with associated costs when used to make purchases, even if it’s simply the cost of making repayments.

However, many lenders offer incentives for customers such as a $0 annual fee or 0 per cent interest on purchases during an introductory period. Additionally, paying off your balance in full during an interest-free period means you could only have to pay back the cost of purchases without interest. You could also be eligible for additional rewards such as cashback during that time, saving you more money.

Does ING increase credit card limits?

You may want to increase your credit card limit for many reasons, such as having access to more spending money. However, if you are using the Orange One credit card issued by ING, you may not be able to do so. 

ING customers can choose a credit limit of their preference when applying for the Orange One credit card. Depending on your financial situation, this limit can be anywhere between $1,000 and $30,000. If you qualify for a Rewards Platinum card, the minimum credit card limit will likely be $6,000. 

Ideally, you should set your credit card limit knowing how much you can afford to repay each month and keep your expenses lower than this level. With most credit cards, you should have the option of requesting a credit card limit increase at a later time, although you will need to qualify for any increase. With an ING credit card, limit increases are out of the question (at the time this was published), which means you may want to apply for a higher credit card limit from the beginning. Remember that you have the option of decreasing your ING credit card limit at a later time.

How do you use a credit card?

Credit cards are a quick and convenient way to pay for items in store, online or over the phone. You can use a credit card as a cashless way to pay for goods or services, both locally and overseas. You can also use a credit card to make a cash advance, which gives you the flexibility to withdraw cash from your credit card account. Because a credit card uses the bank’s funds instead of your own, you will be charged interest on the money you spend – unless you pay off the entire debt within the interest-free period. If you pay the minimum monthly repayment, you will be charged interest. There are many different credit card options on the market, all offering different interest rates and reward options.

Should I get a credit card?

Once you've compared credit card interest rates and deals and found the right card for you, the actual process of getting a credit card is quite straightforward. You can apply for a credit card online, over the phone or in person at a bank branch.