I am often asked for my opinionhow to rate an Avios point. In our articles we use 1p as a guide and it's the value I use myself, but the real world is more complicated.
For the value of the new readers who always join us in January planning trips for the year ahead, I want to review my thoughts today.
What is an Avios worth to YOU?
The value of an Avios pointto youbased on numerous factors:
- where you fly
- Which cabin are you flying in?
- whether you normally use a British Airways American Express 2-4-1 voucher and (which is rarely considered)
- what class and/or airline you would pay if Avios flights were not available
You need to know how YOU value Avios as this will affect what you are willing to pay for it.
We occasionally see offers where you can indirectly or directly collect Avios for between 0.75p and 1p each. Should you jump in at these prices? You cannot be sure unless you have assessed your Avios for your personal circumstances.
You need to be sure that you are getting a lot more for an Avios than its cost priceso it's worth it. This is especially true because you're replacing something very liquid - cash - with something that isn't very liquid at all.
The same applies to Avios trading cards.Once you have your yearBritish Airways Premium Plus American ExpressorBarclaycard Avios Plus MastercardVoucher in your pocket, you need to know if 1.5 Avios per £1 is better than a cashback credit card. If not, your British Airways Amex or Barclaycard Avios card can go back into the drawer.
Here are six different Avios scenarios - which one is right for you?
Instead of answering the Avios value question directly, I came up with six scenarios for Avios redemption. As you can see, everyone places a different value on an Avios point.
before we startRemember that Avios points now have a minimum value. Launched in early 2021, the partnership with Nectar allows you to exchange 250 Avios for 400 Nectar points worth £2. That means your Avios are worth 0.8p each if you use them to shop at Sainsbury's, Argos, eBay etc.Don't redeem your points for flights if you're earning less than 0.8p.
If you ever get the chance to pick up Avios for less than 0.8p, you'll definitely come out on topbecause you can always spend over nectar. Whether higher ratings make sense depends on how you spend them.
Here are some possible Avios redemption scenarios. Which one suits your travel style?
1. Andrew makes two long-distance trips a year with his wife and two children and requires four Club World tickets per trip.
Let's say this is 120,000 Avios per Club World redemption (e.g. Dubai, Boston). One of the two holidays uses the 2 x British Airways American Express 2-4-1 vouchers that Andrew and his wife earn each year.
Let's say £605 in taxes per ticket – the current number according to Dubai.
Andreas is doing well financially. It redeems on leisure routes (Middle East, Caribbean, etc.) where, if sold by British Airways or any other airline, a business class cash ticket during school holidays would cost around £1,499. He can afford to pay cash if necessary.
Total Avios spent per year on two holidays = 720,000 for eight people on two holidays (6 x 120,000 adjusted for the 2-4-1). This assumes that all flights operate during peak price periods.
Value Received: £1,499 per flight when paid in cash - £605 taxes on Avios tickets = £894 per seat x 8 tickets = £7,152
Value received per Avios = 0.99p
0.99p is a 'real' savingas Andrew would pay cash if required in a sale of business class seats. The ability to cancel the Avios seats if needed provides intrinsic value. However, the calculation ignores the miles and tier points that cash tickets would bring.
If any of these trips fall during a low season, you save 20,000 Avios per person (80,000 Avios in total).the value would rise to 1.11p.
The annual fee for the twoBritish Airways Premium-PlusCredit cards are not included in this analysis.
2. Jez and Louise live in the South East and use their Avios for short trips to Europe, flying Economy Friday to Sunday. They don't spend enough to generate a BA Amex 2-4-1 voucher and go on vacation packages for their "main vacations".
Avios required for an economy flight to Prague: 10,500 Avios plus £35 tax, based on a peak weekend.
I have used the 'midpoint' prices as this is generally the best value of the various 'cash and Avios' combinations offered by BA. Under no circumstances should you choose the £1 Tax option as it requires a disproportionate number of Avios.
British Airways cash fare: £150 per person for a shoulder season ticket on a carry-on only fare booked three months in advance. However, Jez and Louise would use easyJet from Gatwick if Avios seats were not available, with a typical fare (one way Fri, one way Sun) of £130.
Value received per Avios = 0.90p.
That's a "real" savingscompared to the easyJet price. The ability to cancel the Avios ticket offers additional value.
If Jez and Louise travel on an off-peak weekend, the travel cost would drop to 9,500 Avios per person, which takes timethe value per Avios point up to 1.0p. The value also increases if they were to take checked baggage with them, as Avios tickets allow for one free suitcase per person.
3. Glynn and Sarah live in Yorkshire and use their Avios for European short trips, flying Economy via Heathrow. They don't spend enough to generate a BA Amex 2-4-1 voucher and go on vacation packages for their "main vacations".
Avios required for an economy flight from Manchester to Prague via Heathrow: 21,000 plus £70 tax on a peak weekend
BA Cash Price: Not comparable as they would be flying Jet2 from East Midlands if they couldn't use Avios. The typical cash price for a mid-season weekend booked three months in advance is £170.
Value received per Avios = 0.47p
Glynn and Sarah would be crazy to change trains at Heathrow and add two hours to their journey time for such a bad return. It would make more sense to exchange their Avios points for Nectar points, which would save them 0.8p per Avios on their next visit to Sainsbury's or Argos.
Even with Glynn and Sarah traveling off-peak, it remains poor value for money. At 19,000 Avios per personthe value per Avios point only increases to 0.52pand in reality the direct Jet2 flight would be cheaper even off peak hours. Transferring their Avios to Nectar remains the best option.
4. David is single and likes to take an unusual route when necessary. He only flies in Economy Class with his own money, but likes to fly in Business Class with Avios. Normally he would spend around £350 on a holiday flight to New York in the spring. He lives in the Southeast.
David flies Iberia Business Class from Madrid to New York for 68,000 Avios + £204 tax return based on a non-peak date (plus 14,500 Avios + £35 for a British Airways economy flight from Heathrow to Madrid by position). Its total cost is 82,500 Avios plus £239.
Value received per Avios (based on £350 in cash for a direct economy flight): Unclear
David spent £155 less in cash than an Economy Cash ticket and flies Business Class instead, but he also spent 83,000 Avios.
The real value, of course, is that he's flying business class, not economy classbut he would never pay for business class.How should he judge the value?
He knows he's giving up £664 worth of Nectar Points by using his 83,000 Avios on the flight, so I guess he must rate the upgrade at least as highly.
5. Alex and Nicky collect enough Avios per year for a long haul redemption to California at Club World using their BA Amex 2-4-1 voucher. They would be willing to pay £1,750 each for a cash ticket in a BA sale or for BA flights outside of Europe. Taxes are £690 per person.
This is possibly the most likely scenario for ahead for pointsreaders without children.You use one 2-4-1 coupon per year for a larger redemption for a couple.
Alex and Nicky spend 150,000 Avios (with accompanying BA American Express 2-4-1 voucher) and pay £1,380 in taxes. This assumes they are traveling at a peak time. The cash alternative would have cost £3,500 for two people.
Value received per Avios: 1.41p
That's a "real" savingsbecause otherwise they would pay in cash. They also get cancellation flexibility that a cash ticket wouldn't have, although they will lose the Avios and Tier Points earned with a cash ticket.
The value increases to 1.70pif they travel to California in a low season for 125,000 Avios.
The annual fee forBritish Airways Premium-PlusCredit cards are not included in this analysis.
6. Charles and Vicky do one tooLong-haul redemption every year to California at Club World. They collect less Avios than Alex and Nicky, so prefer to top up a Club World World Traveler Plus ticket with Avios. They expect to pay £900 in a BA sale for their WTP ticket and would pay up to £1,750 for Club World.
The 'miles upgrade' cost for this ticket would be 50,000 Avios per person at peak times. This saves them £850 per person compared to the cost of the Club World ticket.
Value received per Avios: 1.7p
This is a "real" savings as they would be paying for Club World if needed.
When Charles and Vicky travel off-peak, the value per Avios point drops to 1.42p. This is because the cost of upgrading from World Traveler Plus to Club World at 60,000 Avios is higher during off-peak periods. Crazy but true.
What about first class?
You'll find that none of these people fly first class. That's because very few of us would pay cash for First Class, even if we paid cash for Business Class. The additional Avios you spend on First over Club World will be credited to youintrinsischsatisfactionperceivedworth it, but don't save in hard cash.
(In the last example, if Charles and Vicky never paid £1,750 for Club World but paid £900 for World Traveler Plus, then the 1.7p per point rating is NOT "real" because they would never have spent the extra money Business class first.)
When earning your free Avios by flying, the value you receive per point doesn't matter. However, let's say you earn your miles on an Amex credit card. There is a cost to these 'free' Avios as you could earn a different reward than with other credit cards if you wished - say at a net cost of (say) 0.5p per Avios.
In this case you need to understand that the extra 50,000 Avios for First over Club World to California will actually cost you £250 (50,000 x 0.5p) in lost awards from other cards.
Whether that's good value is up to you - but if you paid for the Avios directly or indirectly, you need to understand your choice.
What about economy redemptions for long-haul flights?
You'll find that none of these people fly long-haul economy on British Airways. Due to BA taxes and fees, this is generally a bad use of Avios points.
However,Guaranteed availability of eight Avios seats per flight at peak times can make economy redemptions worthwhile.
For example, an off-peak redemption to San Francisco in World Traveler / Economy is 32,500 Avios plus £350. With a cash price of over £600 you would get 0.75p+ per Avios value, although this would be rare during off-peak periods. You must also receive over 0.8p per Avios before redeeming an economy flight was cheaper than converting your Avios into Nectar points.
We don't value flexibility
With the exception of the above examples where we upgrade a cash ticket,All of the above 100% Avios options are flexible. Pay £35 per person and you can cancel your booking and get your Avios and taxes back.
In normal times this is not the case for cash bookings. Cancel and you lose your money. This should also affect whether you use cash or Avios and the value you place on an Avios booking.
At present you can of course cancel cash tickets for a Future Travel Voucher. Whilst this generous Covid policy remains in effect, there is no Avios 'premium' for flexibility.
How should you rate your Avios?
How YOU rate an Avios depends entirely on how you use it.
As I've shown above, good deals exist under the right circumstances.It's easily possible to get value in excess of 1p per Avios pointand the new Nectar partnership gives you a minimum score of 0.8p per Avios point.
How to Collect Avios with UK Credit Cards (March 2023)
as a reminderThere are several ways to earn Avios points with UK credit cards. Many cards also havegenerous sign-up bonuses!
In February 2022,Barclaycard has launched two exciting new Barclaycard Avios Mastercard cardswith a bonus of up to 25,000 Avios.You can apply here.
SPECIAL OFFER: Successfully apply for one of the Barclaycard Avios credit cards by April 2nd, 2023 and enter a free draw to win ONE MILLION AVIOS! Full details can be found on the application formshere (free)Andhere (paid). This competition is exclusive tohead for pointsReader. The terms and conditions apply.
You qualify for the bonus on these cards even if you have a British Airways American Express card:
Barclaycard Avios Plus Mastercard
25,000 Avios for signing up and an upgrade voucher for spending £10,000Read our full review
Barclaycard Avios Mastercard
5,000 Avios for signing up and an upgrade voucher for spending £20,000Read our full review
There are two official British Airways American Express cards with attractive sign-up bonuses:
British Airways American Express Premium Plus
25,000 Avios and the famous annual 2-4-1 voucherRead our full review
British Airways American Express
5,000 Avios for signing up and an Economy 2-4-1 voucher for spending £12,000Read our full review
You can also receive generous sign-up bonuses by applying for American Express cards that accumulate Membership Rewards points.
American Express Preferred Rewards Gold
Your Best Entry Card – 20,000 points, FREE for one year & four airport lounge passesRead our full review
Die Platinum Card von American Express
30,000 points and unbeatable travel benefits – for a feeRead our full review
Do you run your own business?
We recommend Capital On Tap for limited liability companies.You earn 1 Avios for every £1, which is impressive for a Visa card, along with a sign-up bonus worth 10,500 Avios.
Capital On Tap Business Rewards-Visum
Receive a 10,000 point bonus and an additional 500 points for our readersRead our full review
You should also consider the British Airways Accelerating Business credit card. This is open to both sole traders and limited companies and offers a sign-up bonus of 30,000 Avios.
British Airways accelerates American Express business
30,000 Avios sign-up bonus - plus annual bonuses of up to 30,000 AviosRead our full review
There are also generous bonuses on the two American Express Business Cards, the points are converted 1:1 into Avios. These cards are open to both sole traders and limited liability companies.
Through March 30, 2023, American Express Business Platinum enrollment bonus will increase to 120,000 Membership Rewards points –Click here. American Express Business Gold bonus increased to 60,000 Membership Rewards points –Click here. T&Cs apply, see application forms for details.
American Express Business Platinum
A crazy 120,000 bonus points (until 30th March) and a £200 annual Amex travel creditRead our full review
American Express Business Gold
60,000 points sign-up bonus (until March 30th) and free for a yearRead our full review
Click here to read our in-depth summary of all UK credit cards that earn Avios. This includes both personal and small business cards.
British Airways and Avios