Best Way to Maximize Barclaycard Arrival Points for 2.27%
Update: The bonus on the Barclaycard Arrival is now 5%, see the Barclaycard Arrival Plus $420+ Sign Up Bonus for details. The change from 10% to 5% will alter the calculations below.
I picked up the Barclaycard Arrival card* in my Credit Card Application Spree last spring. While I’ve redeemed most of the points (or miles as they call them) I earned from the $400+ sign up bonus, I still have more to cash out.
Whenever I redeem points, I like to make sure I’m redeeming them for the maximum value. We’ve discussed before the Best Way to Maximize American Express Points, the Best Way to Maximize Citi Thank You Points and the Best Way to Maximize Chase Ultimate Rewards Points.
Now, it’s time to review how to best redeem our Barclaycard miles!
Ways to Maximize Barclaycard Arrival Points
Travel Rewards. The highest rate of redemption for the Barclaycard points is using their “Pay yourself back for travel” feature. After you make a travel purchase using your Barclaycard Arrival* card, login to your account and redeem miles within 90 days of your purchase. The travel rewards convert to a statement credit at a rate of $25 for 2,500 points. In addition, you’ll earn 10% more points for the redemption, or 250 more points. If you factor in the bonus points, your redemptions are more than 1.1 cents per point, which is the best conversion rate of all the options they give you. More on why I think there is actually additional value of the travel reward redemption rate below.
Cash Rewards. I’m a big fan of cash; however, this isn’t where you can stretch your Barclaycard points very far. The points convert to cash at a rate of $12.50 for 2,500 points. For 0.5 cent per point, it’s an easy redemption option but at a poor conversion rate compared to the travel option.
Gift Cards. In addition to cash, you can also get gift cards that have the same conversion rate. For example a Lowe’s gift card goes for $25 for 5,000 points, or 0.5 cent per point, the same conversion rate as cash.
Merchandise. You can shop with your miles. I compared some of the items to their selling price on Amazon.com and you’d need 33,700 miles to purchase an item that sells for $78 on Amazon. That is at a conversion rate of 0.23 cents per point. I’d stay away from this redemption option!
Tips and Tricks
Watch the Full Amounts. To get the full value of your miles, watch the rounding! For example, we recently had a hotel stay of $117.57. To redeem the full travel credit, we had to use 11,800 miles. We lost 43 miles in the transaction. If you don’t want to give up any of your hard earned miles, you can select a lower redemption option that doesn’t use rounding.
Redeem for Dining and Other Incidentals. On our recent spring break trip, we remembered to use our Barclaycard for our bill at the hotel bar and again at breakfast. Don’t forget any other incidentals that will get coded as travel when purchased at the hotel!
Earning Community Points. You can earn additional Barclaycard miles in the Barclaycard Travel Community by setting up a profile and sharing your travel stories.
Sign up Bonus. The Barclaycard Arrival card* recently updated the requirements for the sign up bonus. New cardholders will earn 40,000 points after you spend $3,000 in 90 days.
Maximize Barclaycard at 2.27%
Clearly the travel redemption is the highest redemption option. Since the card earns 2x miles per dollar on all purchases we calculated that it works out to be more like a 2.2% card in the Barclaycard Arrival review with the travel bonus. However, in the redemption calculation, we’re still failing to add in the benefit of the additional earnings on the redemption purchases at the same time.
Take our $25 hotel bar bill above, which we redeemed for 2,500 points. We received 250 more points on the redemption. In addition, we earned 50 miles on the purchase. Doesn’t that actually bring our redemption rate to 1.136 cents per mile? And at a rate of earning 2x miles on our purchases, aren’t our earnings more like 2.27%? Feel free to work the math on this one in the comments!
What About the Second Year?
Of course, I have a new factor to deal with. My annual renewal is coming up shortly. The $89 annual fee is waived for the first year. But we’ll have to factor in the fee going forward. Which card will win, our Barclaycard earning 2.27% with an annual fee? Or the Fidelity 2% Cash Back Credit Card? I’m calculating the breakeven to be a spending threshold somewhere above $30k. In that case, it might be time to downgrade to the Barclaycard with no annual fee. Do you plan to keep your Barclaycard Arrival for the second year?
More on Barclaycard Arrival
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Did the math, and you’re correct. If you keep redeeming your points for travel reimbursements, the effective rebate rate is 2.272727…%. When comparing this card with an $89 annual fee against a no-fee 2% card, you should go with the Barclaycard card if your annual spending exceeds $32,633.
To further complicate matters, I use a 3% cash rebate card for travel expenses. So, when I forego that rebate when I put travel expenses on the Barclaycard, my rebate rate moves back down to 2.204545%. I think, haha.
I find simplicity is probably the most effective approach especially if you’re married. The dollar value of the missed rebates can be minimal, especially when balanced against family harmony. I use a 2% cash rebate card and a 5% cash rebate gas card – simple for both my wife and me. When I have travel charges, which I generally pay from my computer, I use my 3% cash rebate card. But I don’t subject my wife to this added complication. If I replaced my 2% cash rebate card with the Barclaycard, paid the $89 annual fee, and charged $50,000 a year, I’d get another $13.27 in rebates. Just not worth it – but the $400 sign-up bonus is.
Thanks for that synopsis Chase. That $32,000 mark is an important factor to consider.
Can you still keep (and use later) the points you’ve accrued but not yet used if you switch to the Barclay no annual fee card in year 2?
Yes, that’s what I did. You might want to call customer service to verify for yourself though. The no fee card isn’t the same pin and chip one that the fee card is. So there is less value to the card in that way, but the points didn’t change.
I find that many merchants where I have my largest expenses, such as medical and vet bills, home repairs, and many ithers, do not accept AMEX. That makes the Arrival card a better option for many.
Another major benefit is buying Amex gift cards for 5K using Barclays portal and Arrival card (4X miles + 2x miles). They have this offer very frequently and currently they are having this same offer. I am planning to buy Amex cards and cash out using Amazon Payments next few months. That’s 300$ cash equivalent of Barclays miles.