Bundy Bear

I was looking at joining the Qantas Club but I have a question.

You receive guest passes for joining as a life member. Now do have to be flying with the other person to allow the guest passes to be used or can you give them to all your friends and family even when you are not flying.

From Qantas web site

You will receive a number of Qantas Club guest passes each year so that you may invite family and friends to join you. Each pass may only be used once, and you will need one pass for each guest.


So is the life member worth the $3795.00. I am thinking of benefit 20 years down the track, I only fly about 4 times a year, but I found it worthwhile in being able to check in at the Qantas club/business class lines. At the moment I am silver but will most likely loss this as my next long trip will not be until October.
The other beneifit is the points on the Telstra visa card.

So can someone explain the wording and anyone think the $3795.00 is worthwhile.
With Qantas being the only choice this might give them a chance to increase all the fees.
How many have Qantas Club membership.



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Indecision is the key to flexibility

Koala

Bundy - afraid that to use the guest passes the member has to be present. They are thus transferable, but only for someone who is already a member to use to take one of their guests.
Share your assumption that the price will gradually ratchet up, so buying a life membership at the present price seems sensible. Qantas have already announced that the # of miles given for hotel stays will be slashed from September 1st. Without a competitor in their league, there is little incentive to maintain benefits at the present level, or to hold charges. That is the nature of business, whether we like it or not.
Koala
ps I recommended that my son buy a life membership of Ansett two years back!! So that puts a healthy question mark on the wisdom of my advice!!!

Dave Noble

"You receive guest passes for joining as a life member. Now do have to be flying with the other person to allow the guest passes to be used or can you give them to all your friends and family even when you are not flying."

The guest pass only allows access with a member. They cannot just go in on their own.

"You will receive a number of Qantas Club guest passes each year so that you may invite family and friends to join you. Each pass may only be used once, and you will need one pass for each guest.


So is the life member worth the $3795.00. I am thinking of benefit 20 years down the track, I only fly about 4 times a year, but I found it worthwhile in being able to check in at the Qantas club/business class lines. At the moment I am silver but will most likely loss this as my next long trip will not be until October.
The other beneifit is the points on the Telstra visa card.

So can someone explain the wording and anyone think the $3795.00 is worthwhile.
With Qantas being the only choice this might give them a chance to increase all the fees."

The wording is fairly straightforward. Each year you will receive 10 guest passes for use at Qantas lounges ( you don't need to use passes to get guests into BA or AA lounges however ). For each guest that you take in, you have to hand over a guest pass.

Whether it is worthwhile is really down to you. $3795 is a fair bit of money but it will last you a long while unless QF goes out of business. After about 10 years it will have been cheaper than annual memberships ( assuming the prices stay the same )

"How many have Qantas Club membership."

I have it by virtue of platinum membership.

Dave

NM

Personally I don't think a paid life membership is for me. If I was not a Platinum or Golf FF, I would look to pay year-by-year, so I can evaluate the benefit each time. I have no idea how much flying I will be doing in 5, 10 or 20 years time, nor have insight insight into the future makeup of the airline industry. So it is too much of a risk for me.

However, if you travel for business, you may be able to have your employer pay the life membership as a salary sacrifice. Airline club memberships do not incur FBT when paid by an employer, so the real after-tax cost to you may not be as high as indicated.

I stil have about 18 months of a two year QC membership on-hold from when I became a Gold FF about 6 or 7 years ago, so even when I drop below Gold (unlikely this year), I will stall have QC access for a while.

Let us know what decision you make.

ozzie

Another benefit of life membership is that you are entitled to bring one guest into the lounge without using a guest pass (as for gold and platinum members)

MukMuk

In addition to Qantas Club guest-passes, there are also Qantas Club invitation passes.

Qantas Club invitation passes are much more useful.

As has been said above, if you wish to use a guest pass for a friend/aquainatance to gain entry, then you need to be travelling, and so does the guest.

But an Invitation can be used anytime. You can give them to someone to use, and you don't have to be travelling or even present at the airport. Invitations are a bit harder to get, though.

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As for the decision on the Lifetime membership, could you look at it this way?:
The difference between flying an international trip in paid economy and flying in business class could be about $4,000, maybe more. And yet, for many, this represents value and they choose to pay the difference.

Now, over the course of your life, which purchase would give you greater satisfaction: $4000 spent on one trip flying business rather than economy, or $4000 spent on a lifetime entry to the Qantas Club for you and, effectively, a companion?

In my case, I would say that I would derive more value from the lifetime club membership.

OzFlyer

As a Ansett Golden Wing Life member, I would not signup for Life Qantas Club membership. If you pay for two years at a time, the cost is $250 per year (plus $300 joining fee). This means that Life costs over 15 years of fees.

Five years ago who would have thought that Ansett would go broke, just like who knows what will happen to Qantas in 10 years (all they would need is one or two major accidents and a grounding by the CAA for a week or two and they would lose a lot of confidence in the marketplace). Also note that they are expanding on the basis that Ansett is not in the market BUT if someone like Impulse was to re-enter the market or if Virgin Blue was to increase its marketshare to much, Qantas will be left paying for a lot of excess capacity.

At the end of the day if you have a offset account on your home loan, you will get about 6.5% on your $3795, which is about $246 per year (ie your annual fee based on paying every 2 years) AND you still have the money in the bank if anything ever happens to Q!

MukMuk

Once bitten, twice shy, ozflyer?!

Well, this may be true at the end of the day, but may not be true at the end of the year, or five years or the end of your life.

This is because, in this example, there is no benefit being received from any compounding interest. Instead, you are receiving interest on a fixed amount (or, in an offset account, avoiding interest payments on a fixed amount). However, over time, the price of an annual membership is likely to rise.

If you assume that the interst rate to inflation rate differential of an offset account is say 3%, then price rises will be 3.5% per anum. So, in ten years, a $250 membership will cost $350, and in 20 years $500, but you are still recieving/saving only $246 each year.

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It's worth noting that the price drops to $1935 once you turn 60.

OzFlyer

You are correct, however it also does not take into account rising interest rates, which would allow some compounding of the principle plus your model does not factor the risk that Qantas will not be around in 10 years (See Ansett). It also does not allow for the fact that if you ever make status on Qantas or start to work for a company that offers free membership (or dont intend to fly for a year or two - say you move overseas) in the future can stop payments to Qantas for that year and save the money.

And to top it off you still have the $3795 sitting in your account at the end of the day!

At the end of the day both options have pros and cons but I still think the cons outweigh the pros.

BTW if you do join the Q Club I think you get a small discount if you goto the Qbiz subsite within Qantas's website (Free registration).

Edited to fix grammar

[This message has been edited by OzFlyer (edited 03-20-2002).]

bers

I'll just add my 2c worth here. I did fork out the $3795 two years ago and regret it a tiny bit. If I had the choice all over again, I would fork out for a 2 or 5 year membership now and put the remainder into something like a property trust or an index fund.

Whilst the point that the costs will rise over the years (I am VERY suprised it hasn't risen for the last 2 given that Ansett is gone under - I suspect QF really is worried about ACCC), if you have future travel patterns anything like me, it may not be the best. I select jobs on the basis of travel and so it's highly likely that I will fly enough to qualify either through AA or through QF in a few years time. You will get the compounding effect from the years you do not need to fork out for the money.

For those out there who know too much Finance theory, think of the idea of not paying for membership when you get it free (QF Gold or Platinum) as a "Real Option". The option being the choice not to pay because you are getting it free. You don't get this in life membership because you've already paid for that year no matter what. Additionally, there is a Real Option in the sense if QF ever goes under, then you might Like any option, it has value, even when it seems unlikely.

You could then buy the senior life membership when you hit that age and probably aren't flying any more. Don't forget that you might also get Life Gold and it's pretty silly to fork out all that money if you've got a good chance at getting 14000 tier credits.

Then again, some may want to balance this against the implied real option that I will never have to fork out money again even if I'm broke and had to sell the investment I was saving the money in. Plus, I will probably get money value out of it - I bought it when I was 19.

In short: Flexibility has value. You don't get that value if you buy a life membership so maybe it's not best to.

Bundy Bear

Ok, thanks for all the suggestions, for now I brought a corporate membership for $441.92, to see if there is any benefit. If I don't like it I then won't think I would have spent all my money, 2000 Qantas points is also handy to have as well.

kawoh

I heard somewhere AMA members pay $1700 for life membership... anyone know anymore detail on this?

kpc

You must be a doctor and a member of the Australian Medical Association (AMA), which costs about $1000 per year in membership fees!!

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kpc

[This message has been edited by kpc (edited 05-16-2002).]