Many people opt to use credit cards for the rewards points it can earn them. Credit cards that offer Virgin Velocity points reward you for your everyday spending by giving you frequent flyer points.

When used correctly, these credit cards can be a worthwhile way to boost your points balance by going about your everyday shopping and spending. To get the most out of credit cards with Virgin Velocity points, compare the cards’ features and fees to make sure you come out on top and reap the rewards.

It’s easy to get carried away and only think about the reward points, so it’s important to note that at the end of the day, these are credit card products with potentially higher than average interest rates and annual fees. So Velocity Frequent Flyer credit cards might not be right for undisciplined spenders.

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How do credit cards with Virgin Velocity points work?

There are a handful of different types of credit cards with Virgin Velocity points on the market, and they all work slightly differently. But it’s safe to assume that the more you spend using the card, the more points you can potentially earn. This could be worthwhile provided you can pay off your debt before you’re hit with interest. Once you’ve accrued enough points, you’ll be able to cash them in for flights, upgrades, accommodation, car hire and merchandise.

You can expect to earn between 0.5 and 2 points for every $1 you spend on eligible purchases. An eligible purchase could be your weekly grocery shop or paying for petrol, but cash advances and BPay payments are generally not rewarded with points.

Normally, if the credit card earns Velocity points directly, you won’t need to do anything after you’ve made the eligible purchase; they’re usually transferred straight into your Virgin Velocity account.

Alternatively, if it’s a partner credit card, you’ll need to manually transfer any eligible reward points you earn into your Velocity account. Do your research on any additional fees the credit card issuer might charge for transferring the points across and which card gives you the best transfer rate.

How to compare Virgin Velocity credit cards

Much like any other credit card, cards that earn Virgin Velocity points have different features and fees. Make sure that any card fees and interest rates don’t outweigh the benefits of earning points.

  • Earn rate

The more points you’ll earn for each $1 spent, or the higher the earn rate, the more you’re getting out of your plastic. 

If you’re comparing credit cards with Virgin Velocity points, check whether any of the credit cards offer bonus points when signing up. But remember, there’s more to a credit card than bonus points; while they can be worthwhile, it’s the ongoing costs of the card that you need to be comfortable with committing to.

Much like any other credit card, check for other incentives, like interest-free days, as well as any other perks, like free travel insurance or exclusive offers.

  • Interest rate

When it comes to rewards cards like credit cards with Virgin Velocity points, the interest rate tends to be higher than standard credit cards with fewer features.

If you tend not to pay your card balance in full each month, a higher interest rate may cancel out the benefits of any rewards points. Look for cards that offer a lower interest rate and be wary of any potential interest you could accrue on your card balance.

Interest-free days are another feature to keep an eye out for. This grace period, usually between 45 and 55 days, when your purchases are not hit with interest can help you keep your card costs down.

  • Card fees

Much like interest rates, rewards cards like credit cards with Virgin Velocity points tend to have higher annual fees than cards with fewer features. While you may be earning points, you’ll also be paying for the luxury by way of higher rates and card fees.

On occasion, some cards may waive or discount the first year of fees as an incentive. Before you apply for a credit card with Virgin Velocity points, be sure to do your research to make sure that the standard annual card fee doesn’t outweigh the perks of earning points.

If you plan to use the card overseas, be aware of any international currency charges or additional fees. It’s worth noting that cash advances generally don’t earn Virgin Velocity points and tend to incur a high cash advance interest rate.

  • Card perks

Some credit cards with Virgin Velocity points come with bonus perks like complimentary travel insurance and other freebies. In most cases, complimentary travel insurance is usually offered on platinum or premium credit cards. The upside of premium platinum cards is that they tend to have a lot more features, the downside is that the annual fees and interest rates are often higher.

If you’re a frequent traveller, paying the premium for a card that offers you extra features may work in your favour. But if you don’t travel often or you require complicated insurances, premium platinum cards might not be the best value. Always check the terms and conditions of the insurances to make sure that the level of complimentary cover and the inclusions suit your situation.

Other card perks may include a complimentary domestic flight, flight upgrades or vouchers or complimentary entry passes into the Virgin Australia lounge.

What to look out for when comparing credit cards with Virgin Velocity points

All credit cards come with the risk of overspending, especially when you’re spending the bank’s money before your own. Rewards cards that incentivise spending by offering rewards points can tempt cardholders to overspend for the sake of earning points. It’s important to remember that credit cards are essentially short-term unsecured loans from banks, which charge interest on the money you spend. If you don’t pay off the balance within the interest-free cycle, the points might not be worth the extra interest costs you’ll be charged.

Some frequent flyer cards will cap the number of points you can earn by using the card. As rewards cards tend to have higher fees and interest rates, do the maths to make sure that you’re still getting value for money and that the number of points you may potentially earn are still of value to you.