Holidaymakers are advised to ditch cash and potentially save more than £2,000 during a fortnight's break. Experts at MoneySuperMarket have shared their top tips for saving thousands of pounds by using reward and cashback cards.
It has explored how consumers can use reward credit cards to help make their money go further. Visitors to the price comparison site have displayed growing interest in this option during the last year, with online searches doubling (June 2021 compared to June 2022).
Research by MoneySuperMarket found that the average cost of a holiday this summer is £1,217 and an air miles credit card could potentially offset the costs of a break.
Getting a British Airways American Express Card could accumulate 5,217 points if a user paid for a holiday within three months of getting the card. New members automatically receive 5,000 bonus Avios points when they spend £1,000 in the first three months of card membership.
Each is worth around £0.45, meaning a customer could claim back approximately £2,347 worth of rewards, such as flights, hotel stays, seat upgrades, car rentals abroad and more.
Another example is the Virgin Atlantic Reward credit card, where travellers can collect 0.75 Flying Club miles for every £1 spent on everyday purchases and 1.5 miles for every £1 spent directly with Virgin Atlantic or Virgin Holidays. This means it is possible to collect 1,825 miles on a Virgin Atlantic Reward credit card a holiday is booked directly with Virgin Atlantic.
Cashback credit cards are designed for everyday spending on any purchases and they can usually be used at any retailer. These are another option for cutting bills. Office for National Statistics figures calculate average monthly expenditure for an individual is £1,077.70, and £2,547.57 for the average family household.
MoneySuperMarket has calculated the average amount of cashback an individual could receive annually based on these figures is £202.07. For a household, it is £447.91.
Jo Thornhill, at MoneySuperMarket, said: “We’re all looking for ways to be savvy with our spending and reward and cashback cards could be an option if you pay your balance off in full each month. Be careful though, because if you don’t pay off your credit card balance, the interest could quickly eclipse the value of the benefits you’ve earned."
She added: “You can compare the range of reward credit cards available at MoneySuperMarket.com to find the one that best suits your needs and that can help you to make savings on items that you plan to buy anyway. Credit card users who are responsible with their spending and always pay off their balance in full every month could reap the benefits of a rewards credit card.
“If you are someone who shops at the same retailer regularly, or you go on holiday (and fly with a particular airline) often, then you could be saving money on purchases you would have bought anyway as the retailer will reward you for your loyalty.”
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