Should You Get the British Airways Card Now or Wait?
Update: Some offers mentioned below are no longer available. View the current offers here.
Until recently, the British Airways Visa Signature Card offered a sign-up bonus that could earn you a total of 100,000 Avios. That offer recently ended though, and you may be wondering if it's still worth signing up. TPG Senior Points & Miles Contributor Nick Ewen explains the pros and cons of applying now.
The British Airways Executive Club program has been hit with a few changes over the last couple of years, including the removal of 4,500-Avios award flights in North America, a decreased transfer ratio with American Express Membership Rewards and last spring's significant devaluation. Despite these drops, the program still offers some compelling redemption options and a lucrative co-branded credit card. Now that the 100,000-point bonus on the British Airways Visa Signature Card has dropped to a more "normal" level, I want to analyze whether it still makes sense to apply for this card or pursue other options.
The now-expired 100,000-point offer actually had three components. The first was the same as the current offer, but then you could earn two more pops of 25,000 Avios during your first year: one when you hit the $10,000 spending threshold and another when you reached $20,000.
Both the old and new offers require a significant amount of spending to earn the full bonus. Assuming that your purchases are solely with non-British Airways merchants (and thus only earn 1 Avios per dollar spent), here's how your earnings break down at each of the key thresholds:
$10,000:
Offer | Sign-up Bonus | Regular Earnings | Total Earnings | Return |
|---|---|---|---|---|
Old (100,000) | 75,000 Avios | 10,000 Avios | 85,000 Avios | 12.75% |
New (75,000) | 50,000 Avios | 10,000 Avios | 60,000 Avios | 9% |
$15,000:
Offer | Sign-up Bonus | Regular Earnings | Total Earnings | Return |
|---|---|---|---|---|
Old (100,000) | 75,000 Avios | 15,000 Avios | 90,000 Avios | 9% |
New (75,000) | 75,000 Avios | 15,000 Avios | 90,000 Avios | 9% |
$20,000:
Offer | Sign-up Bonus | Regular Earnings | Total Earnings | Return |
|---|---|---|---|---|
Old (100,000) | 100,000 Avios | 20,000 Avios | 120,000 Avios | 9% |
New (75,000) | 75,000 Avios | 20,000 Avios | 95,000 Avios | 7.125% |
As you can see, in all of these cases, the old offer is either equal to or superior than the current one. As a result, you may immediately assume that you should wait for another 100,000-point bonus. However, there's no guarantee that such an offer will come back. Credit card issuers look at many factors when determining a sign-up bonus, including number of new cardholder acquisitions and retention rates. The bonus could jump back up next month, next year or never.
Despite this uncertainty, the current offer is still a compelling one. British Airways' distance-based award chart provides some really great redemptions, and if you can hit the $30,000 spending mark in a calendar year, the Travel Together ticket can also be a terrific value. The no foreign transaction fee benefit can also save you money when you are traveling abroad, though the card does carry a $95 annual fee, it is not waived for the first year.
Should you consider other options?
Despite these perks and the lucrative sign-up bonus, you might be better off pursuing a different card (or two). For starters, the British Airways Visa Signature Card requires a relatively high level of spending to earn the full sign-up bonus.
In addition, another big drawback to the BA Visa is that you're locked into earning Avios. Sure, the full sign-up bonus is worth $1,125 based on TPG's most recent valuations, but you're restricted to using those points for flights on British Airways (and its horrendous fuel surcharges) along with its partner airlines. There are two other options that don't force you into that position but still offer similar value.
Chase Sapphire Preferred Card
One of the best alternate credit cards in this context is the Sapphire Preferred. Chase raised the standard sign-up bonus on the card in November, as it now offers 50,000 Ultimate Rewards points after you spend $4,000 in the first three months from account opening.
In addition, the Sapphire Preferred offers some key benefits that outshine the British Airways card:
- Primary rental car insurance
- Double points on dining and travel purchases (including services like Uber)
- Valuable and transferable Ultimate Rewards points (including the ability to transfer to British Airways)
- Ability to book travel directly using points (and earn elite-qualifying miles)
- Waived annual fee for the first year
All of these perks make the Sapphire Preferred a great option as a starter card but also make it ideal for experienced award travelers. Using the card for a year can unlock some terrific redemptions, and it's actually the card that TPG uses most frequently himself!
Ink Plus Business Card
Another terrific option is the Ink Plus, also issued by Chase. This card is marketed as one for small businesses, but that doesn't mean you can't take advantage of its benefits as a sole proprietor who sells items on Ebay or Amazon. Chase bumped the card's sign-up bonus back in September; you can now earn 60,000 bonus points after you spend $5,000 on purchases in the first three months after account opening (worth $1,260, or $135 more than the BA Visa). Like the Sapphire Preferred, these points can be transferred to a variety of partners, including Hyatt Gold Passport and United MileagePlus.
The card also provides some terrific bonus categories. You can earn 5x Ultimate Rewards points per dollar on the first $50,000 spent in combined purchases at office supply stores and on cellular phone, landline, internet and cable TV services each account anniversary year. You'll also earn 2x points per dollar spent at gas stations and hotel accommodations each year (also up to $50,000 in combined purchases). Both of these represent a superior value over the BA Visa.
Why these cards are more time-sensitive
There's another reason why these two cards are terrific alternatives over the British Airways Visa Signature Card: Chase's new rule regarding cards that accrue Ultimate Rewards points. I addressed this in my post on the application restrictions for major card issuers back in October, but the basic gist is this: As of early 2015, reports began to emerge of Chase automatically rejecting applications for these two cards if you've opened 5 or more new credit cards in the previous 24 months. This may not be a problem for a casual traveler, but for a points and miles enthusiast like me, this presents a significant issue!
However, as of now, this restriction doesn't apply to other co-branded cards like the BA Visa and Marriott Rewards Premier Credit Card. As a result, if you're just getting started in the hobby, I would strongly encourage you to pick up either the Sapphire Preferred or Ink Plus first before moving onto other Chase cards with less restrictive application rules. That way you won't inadvertently shut yourself out of a card that earns incredible valuable Ultimate Rewards points and leave the door open for the British Airways card in the future!
Bottom Line
The British Airways Visa Signature Card offers some terrific perks, even with the end of the 100,000-Avios offer. However, there are some compelling reasons to consider other credit cards from Chase that provide similar value from the sign-up bonus but also offer superior earning rates and added flexibility for award redemptions. Everyone has their own rationale when it comes to applying for and then keeping certain credit cards, but hopefully this post has demonstrated why waiting to apply for the BA Visa may be the best plan.
Are any of you planning on applying for the British Airways Visa despite the lower sign-up bonus?
