Earn free flights with your Christmas shopping

Play your cards right and the way you pay for your Christmas shopping could help cover some of the cost of next year's holiday.

How are you going to pay for your Christmas shopping?

If you have a big spend coming up, perhaps you’re planning to use a 0% credit card and spread the repayments? Or if you know that you can pay off your balance in full, you may be using a cashback credit card – that way you get to make a little money back on your spending.

However, with one of these cards you could use your Christmas spending to help cover the costs of next year’s holiday!

American Express Preferred Rewards Gold card

Let’s start with something different – a piece of plastic that’s a charge card rather than a credit card.

The American Express Preferred Rewards Gold card is a card that until recently would only be found in the wallets and purses of big spenders, on account of its annual fee – an eye-watering £125. However, American Express is currently waiving that fee for the first year, opening up the potential rewards to those of us with a more modest budget.

The money you spend on the card collects points, which can then be traded in for a range of rewards, including flights and hotels. You get one point for every £1 you spend on the card, which doubles for any travel (including petrol) or supermarket spending you do.

What’s more, spend £2,000 on the Preferred Rewards Gold card in the first three months and you’ll pocket 20,000 bonus points – enough for two return flights to locations including Paris, Amsterdam and Istanbul with British Airways. Best of all those points can be transferred over to a variety of different frequent flyer programmes.

The card also offers two complimentary airport VIP lounge visits a year with Lounge Club and ‘travel inconvenience insurance’ for flight cancellations, delays and delayed luggage if the tickets are purchased with the card.

Charge card vs credit card

This means that there’s no pre-set spending limit, nor is there any interest charged. However, it does mean there’s no flexibility – you have to pay off your balance in full each and every month.

On the downside, this means that your purchases are not subject to the same Section 75 protection as money spent on credit cards.

That said, American Express offers its own Refund Protection with the Preferred Rewards Gold card, covering items for a refund or replacement up to 90 days after the purchase (up to a maximum of £300) even if the retailer won’t. There’s also Purchase Protection, so if your item is stolen or damaged in the first 90 days, American Express will replace or repair it, or refund you up to £2,500.

Lloyds TSB Duo Avios

As the name suggests, the Lloyds TSB Duo isn’t a single credit card – it’s two, a MasterCard and an American Express. This is so that you can continue collecting Avios (what used to be known as Airmiles) even in stores which do not accept American Express.

You get one Avios for every £1 spent on the American Express and for every £5 on the MasterCard. What’s more, if you manage to spend £500 in the first three months, you’ll get a bonus 18,000 Avios – enough for two return flights to places like Paris or Prague.

The Duo cards don’t come with an annual fee.

However, for £50 a year you can upgrade to the Premier Duo cards, which bumps your Avios return by 25% and bags you a free worldwide companion ticket when you spend £15,000 in a year.

And should you manage to spend £500 in the firth three months, you’ll pocket a bonus of 30,000 Avios, bringing even more exciting destinations like Marrakech and Cairo into play.

British Airways American Express

Again a part of the Avios scheme, the British Airways American Express is another fee-free credit card offering one Avios for every £1 you spend.

If you spend £1,000 over the first three months you’ll pocket 9,000 bonus Avios, which is significantly worse than the Lloyds Duo bonus. But if you manage to spend £20,000 in the year you’ll get a free worldwide companion ticket.

Again, there’s a more impressive fee-charging version, the Premium Plus, which will set you back £150 a year.

This time there’s a 25,000 Avios bonus if you spend £3,000 in the first three months, with 1.5 Avios earned for every £1 you spend. And you only need to spend £10,000 annually to qualify for the free companion ticket.

Virgin Atlantic Black and White cards

Virgin Atlantic offers its own credit cards for those who prefer to fly with Branson and co, which work much like the Lloyds Duo cards in that you get both an American Express card and a card to use in stores which don’t accept American Express, in this case a Visa.

With the White cards you get one Flying Club Mile for every £1 spent on the American Express and for every £2 on the Visa. There’s no annual fee and you get a bonus of 3,000 miles with your first purchase. Sadly, they won’t get you very far – you need 7,500 just to fly to Manchester in economy! You can see how many miles you need for each of the destinations Virgin flies to on this spending miles table.

Meanwhile, the Black cards offer two miles for every £1 spent on the American Express and one mile for every £1 on the Visa. There’s also 6,000 bonus miles with your first purchase.

However, there is a painful £140 annual fee to pay too.

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