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Reward Points: The Real Deal

Reward Points REAL DEAL the fine print* How it works How it really works 1. Qualifying Purchases: Not everything will earn points. Common exclusions are gift cards, cash advances, taxes, tobacco, and alcohol. Some credit cards will not count purchases where you use a PIN and others exclude discount stores like Walmart and Costco There are lots of options out there to save money: cash back, low interest, regular old coupons. But only reward points make us feel like we are playing skee bal!. Play the game, get tickets, redeem for a plastic whistle, slinky and 5 tootsie rolls. You sign up for a rewards program. 2. Annual Fee Seemingly generous signup points can come with annual fees that cost more than the value of the points awarded. You won't get signup points in year two but you'll still have to pay the annual fee. 15,000 of anything sounds like a lot, and if it's 'free' then you feel like a winner. However if your one time gift has a value of $93.75 and it costs you $99 each year, then the 'deal' vanishes. You are lavished with excessive signup points. 3. Reset: Some programs will reset your points to 0 at the end of the calendar year, or even quarterly. A missed payment can trigger a reset too. Most savvy shoppers can calculate the savings in their heads. Two for one, half price, 50 cents off, no problem. Now throw in point value exchange rates and multipliers and 5x the points on a can of soup will look more attractive than 3 cents off. You watch for point multipliers, bonus points, and other incentives. 4. Reward Expiration: Often with automaticially issued rewards, like quarterly checks, the reward itself will expire if not used in 60 to 90 days. You shop like crazy earning tons of points. People love games, and earning points is another way shopping get's iurned into an expensive sport. You can bet your discretionary spending will increase to reach that 'high-score! Nice! You just spend $24,000 and are sitting on a mountain of points. This entitles you to a free... It's very difficult to determine the value of a reward if you are only presented with its point value. Citi will give you Sandy Koufax's signature for 106,800 points, and if you spend half a million dollars at Home Depot, you get to go to the Super Bowl. 5. Delays: Your reward may be issued quarterly and then take 6 to 8 weeks to arrive. Make sure your address is up to date. The thrill is gone once you realize that the game is fixed from the beginning. Time to find better ways to save, like bu ying iess stuff. 6. Low point value: Not all points are created equal. Some programs offer higher multipliers by devaluing their points. Be aware of offers that are below 1 cent per point. Toaster oven. Multipliers in ppd (points per dollar) Program Point Value Bonus Points Fee DISCOVER Escape 1,000 per month $60 ** .5 to 1 cent 2 ppd How to be a POINTS NINJA 5 ppd on entertainment 2 ppd at restaurants 25 per billing cycle CapitalOne MTV .5 to 1 cent 5 ppd on restaurants, movies, books, music 11,00 after $250 spent in 90 days If you have vigilance and cunning skills of a Ninja, you can turn reward points into instruments of price destruction. cíti Forward .625 cents citì Platinum 3 ppd on everyday items 2 ppd on everything else 15,000 after $300 spent in 3 months .625 cents $99 Know the Angles: Use the right card or combination of cards to maximize benefits. A Citi Forward card together with a Best Buy Reward Zone card will yield a bigger discount (5%) than the Best Buy Mastercard (4%). cíti Sonoco 10 points per gallon at Sunoco .625 cents citi Diamond .625 cents 5 ppd on everyday items Charge the big stuff: Most programs will allow you to earn points on paying your household bills. Gas, groceries and medication are other big expenses that can add up. 10,000 after $500 spent in 3 months ** WERIAN Gold 1 cent 1 ppd $125 25,000 after $1,000 spent in 3 months ** Platinum 1 cent 1 ppd $450 Always pay your bill: One late fee will take the equivalent of $3,900 worth of spending to offset with points. Make sure you have the cash before you charge it. Kroger 1 cent double point sales Sobeys additional point sales 75 cents 10 ppd up to 20x multipliers Redeem for cash: Reward catalogs are full of inflated prices and point values. Always redeem for cash unless the cash option has a lower point value (Capital One). SHOPPERS DRUG MART 14 to .20 cents Never buy points: This one is for suckers. Buying points to reach a certain level is always a bad move as you will get creamed on the exchange. Best Western will allow you to buy $3.80 worth of points for $10. BEST BUY 1 ppd *** 2 cents BEST 2 ppd at Best Buy .5ppd everywhere else 50% bonus points after $2,500 *** Mastercard 2 cents KHOME DEPOT Massive deal alignment: Some programs with multipliers can be exploited if you play it right. Buy $150 at Shoppers Drugmart, using your Shopper's Mastercard, on 20x point day, then redeem those points on a Bonus Redemption Weekend, and you will get $170 off your next purchase. That's 53% off. 3 ppd at Home Depot 2 ppd for everyday items Mastercard .7 to 1 cent 3,500 Best Western .38 cents 10 ppd * All programs have a minimum of 1 ppd (point per dollar) unless noted. Everyday items generally include supermarkets, drug stores, and gas stations. Retail programs only apply points to purchases made from the retailer. Mint.com/blog WallStats.com RETAIL CREDIT CARDS * * * * * * * * * ** * * * * * * * **

Reward Points: The Real Deal

shared by admin on Mar 18
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If you've ever been offered a rewards card from a major retailer, the perks can seem very enticing. From free enrollment to an instant discount, it can seem too good to be true. But like the old adage...

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