surcharge vs points

[Zoe Nguyen]

I have just started to use AMEX, and do not really know how to calculate points to $ value.

Up to what % surcharge that I should refuse to use Amex and better off using my Mastercard ?

Thanks

 

[serfty]

It really depends on how much you value a 'point'.

Different type of points can have different values - in this case perhaps stick to Amex MR points.

The value of a point is relative to what you can redeem one for; how much it costs to earn etc.

e.g. With paying TAX bills via Amex, there is 1¼% fee charged - if you value that 1¼¢ per $ at less than the value of AM MR points you can earn for that payment then go ahead; if not then don't.

Note that different AMEX products may have different point earn, common levels are 1point per Dollar (Amex Golf Charge) and 1½ points per dollar (Amex Reserve Platinum Credit).

 

[Stephen65]

The value depends on what you spend them on. Assuming you have a card that earns 1.5 MR per dollar spent then at the low end you can redeem them for cash at about 1 cent per dollar spent.

At the high end the most productive use for points is for J or F travel where points are frequently worth at least 5 cents per dollar spent. For example, I recently used 400,000 MR points transferred to QFF to book mixed F and J JASA and FASA travel that would have cost about $17,000 to buy for cash.

$17,000 of fares for 400,000 points = $268,000 spend = return of 6.3 cents per dollar spent (plus we will also reap 380SC each from the trip)

You also need to factor in that in some circumstances the surcharge may be tax deductible which will reduce its effective cost to you.

 

[Zoe Nguyen]

The value depends on what you spend them on. Assuming you have a card that earns 1.5 MR per dollar spent then at the low end you can redeem them for cash at about 1 cent per dollar spent.

At the high end the most productive use for points is for J or F travel where points are frequently worth at least 5 cents per dollar spent. For example, I recently used 400,000 MR points transferred to QFF to book mixed F and J JASA and FASA travel that would have cost about $17,000 to buy for cash.

$17,000 of fares for 400,000 points = $268,000 spend = return of 6.3 cents per dollar spent (plus we will also reap 380SC each from the trip)

You also need to factor in that in some circumstances the surcharge may be tax deductible which will reduce its effective cost to you.

I'm current hold Amex Platinum edge card, which earns 1 point per $ spent (except for Supermarket and petrol where I will earn higher points). I'm interested in Krisflyer points transferring at 1 point = 1 mile. I still dont know how to justify the costs ???

 

[Stephen65]

You might be better off asking in the Krisflyer sub-forum Zoe. I don't know how cost-effective conversion from MR points to SIA award flights is.