Make your air miles work and take a flight of fancy

With the majority of the UAE population made up of expats, one thing most do at least once a year is fly. It therefore makes sense to take out an air miles credit card to help save on fares. But which one is best — and how do you make the most of it once you have one?

 

First, choose a card that is tied to an airline you use most often, says Preeti H. Bhambri, Founder and CEO of comparison site Moneycamel.com. While that may initially seem simple, going for one linked to Etihad Airways if you live in Abu Dhabi or Emirates if you are in Dubai, for example, it is not quite as easy as it may seem. Sites like Compareit4me, Souqalmal.com and Moneycamel list hundreds of air miles cards tied to either airline. 

 

Rewards first

One way of whittling it down is to consider the number of rewards you receive. “Not all cards give the same rewards for a fixed spend,” says Bhambri. “Check the conversion rate of rewards earned on spend, i.e. how many miles do you get per Dh1 spent? Or the other way around, how much do you need to spend on a card to earn one mile.”

 

The terms are also important. Experts say some cards do not offer miles on certain types of expenses like utility bill payments. And some purchases offer more miles. “Usually, international spend earns you more miles versus local spend,” says Josiane Assaad, Head of Content at Souqalmal.com. “Make sure to check the terms of your credit card so you’re aware of the conversion of every dirham spent locally or internationally. Also, make sure you do your research to identify the credit card that provides you with the best air miles reward system based on your lifestyle,” she adds. 

 

Once you have one, experts say in order to maximise the number of miles you earn, it’s a good idea to put all, if not most, of your daily expenditure on your air miles card. It will not only help you build miles quicker but also helps track your spending better than if you were using cash, says Bhambri.

 

However, you have to be careful and ensure you pay the balance off each month, otherwise the miles will prove prohibitively expensive. “Make sure not to go into the debt trap,” says Assaad. “Many personal finance experts advise to keep your credit card utilisation ratio below 40 per cent. You will be also able to avoid negatively impacting your credit report.”

 

Big payments

Consider paying for your biggest expenses with your air miles card in order to further maximise your miles. Big-ticket items like cars or rent are especially helpful in accruing miles quickly. The idea is that you are spending the money anyway, so you may as well receive a reward for it, which is in this case, miles. 

 

“Large expenses such as school fees, house maintenance fees, car servicing charges and other big value purchases should be made on card, of course on the basis that the card bill is settled in full at the end of the month,” says Bhambri.

 

When it comes to claiming your miles, experts say avoid the temptation to buy a business class seat straight from your balance. “If you have a sufficient air miles balance on your card, it is more economical to upgrade to business class after purchasing an economy ticket or even while boarding versus paying a large sum of money to purchase the business ticket,” says Assaad. 

 

Experts say if you are flexible with when you can fly, for example on off peak days, you can get better deals. “This holds true especially when considering expat travel that revolves around the July to August and December to January period,” explains Assaad. Bhambri adds, “Also book way in advance as these tickets get sold out almost as soon as they are released.” 

 

Do not assume you will earn miles on balance transfers. The general rule of thumb is that you will not. However, some banks such as UNB and UAB have offered extra miles on balance transfers in the past, says Bhambri.

 

“When you’re transferring your balance to a new card, the miles you’ve already earned can still be used by you,” says Assaad. “Make sure to check with the provider about terms of use and expiration details. 

 

TIPS ON REDEEMING MILES