While it is hard to spend frequent flyer points at the moment there are some creative ways to earn points. Buying a car is a great way to quickly boost your points balance (providing you need a car!).
For a whole range of reasons I ended up buying two cars in the past year and generated nearly 20,000 Qantas frequent flyer points. Enough to fly from Sydney to Darwin in economy. I thought I would share what I learnt.
In this post:
How Many Points Will I Get When I Use My Credit Card To Buy A Car?
The points you get will depend on the card that you use. Julie’s American Express credit card did not have a big enough limit to purchase the car. So we had a mix of Qantas American Express Ultimate Card and Westpac Altitude Rewards.
For the Qantas American Express Ultimate Card we received 16,500 Qantas frequent flyer points for $13,255 spend at 1.25 Qantas points per $1 spend. The Westpac card gave 13,255 points for $17,000 spend at .77 points per $1 spend.
What Is The Best Credit Card To Purchase A Car
If points are the major reason to use a credit card then the American Express is the best credit card to purchase a car. Compared to the Westpac Card you get nearly 66% more points. Check the terms and conditions of the card you intend to use as some cards such as the Commonwealth Credit Ultimate Awards credit card will cap the points based on spending over $10,000.
What Happens If My Limit Is Not Big Enough?
Try to avoid purchasing a car on impulse. This will give you enough time to obtain the right card with a big enough limit. I failed to follow this advice and missed over 10,000 Qantas frequent flyer points.
In the example above I was able to split the purchase over two cards and even provided the card details over the phone. You should also be able to split the transaction over a number of cards or even payment methods such as credit card and bank transfer .
Will it Work With Any Car Brand?
Based on our experience we were able to put the full purchase price of a Toyota Corolla Hybrid on a credit card. At around $30k we had enough limits on our card without worrying about not being able to do our weekly grocery shop.
Mercedes only allowed us to pay a $5,000 deposit and paid the rest via trade in and bank transfer. In hindsight we should have pushed to put more on the card.
How Much Is The Surcharge To Use A Credit Card To Purchase a Car?
Mercedes did not charge a surcharge to place a deposit down but did not encourage the full purchase on a credit card.
Toyota charged us a 1% surcharge which would have been good value if we had been able to put the full purchase price on our American Express. In hindsight this could have been negotiated to zero surcharge as we found out at final payment.
What Are The Tips To Buy A Car On A Credit Card
- Make sure you have a card with a big enough limit so you don’t need to split the transaction,
- Aim to get more than 1 point per dollar spend by using an American Express Credit Card,
- Make sure you negotiate the credit card surcharge to zero percent (they will do this!),
- Try to have a separate card available for large purchases to make sure you don’t run out of credit, and
- Do your research before turning up!
Use this link to access a special offer on a Qantas American Express Credit Card
