December 13, 2019 7:40 am Written by

Loyalty Cards and Cash Back Credit Cards: Are They Worth It?

In our search to save money and find the white whale of bargains, as consumers are faced with many choices.

Especially this time of year with Black Friday being here, the Christmas sales, and then after the New Year more sales.

However, some of us like to save money all year round, or at least get a little something extra when we do need to spend money.

That is where Loyalty Cards and the use of cash back credit cards can help, or at least, add to our savings.

In fact if you take the time to look around, and maybe just look in your wallet or purse, you will see how popular loyalty schemes are. Just about every store and major retailer has some form of loyalty programme.

And why not!

Tesco, Boots, Superdrug, Coop, Nectar, all offer loyalty schemes where you gather points, which can be used in the future for purchases.

M&S now have one as well.

Many food chains and coffee houses have these loyalty programmes as well, Costa Coffee, Starbucks, Nandos, all offer loyalty schemes where if you buy enough of their food or drink, you can get a free drink, or food item.

Some of these food and drink loyalty schemes need to be looked at closely as to if they are really worth the value?

You may wind up spending £50 for a free cup of coffee; not exactly good value. However, if you eat or drink there all the time anyway, the freebe is just a bonus.

Some of these loyalty programmes can be a great way not to save money upfront, but to build up to something.

Tesco Club Card: Tesco’s Club Card has changed over the years. Initially it was a get 1 point for every pound you spend, then each quarter you receive your Club Card points in vouchers.

The vouchers could be redeemed in store for shopping, or with one of Tesco’s partners.

For a while this was a GREAT deal as many of the partners would quadruple your points for purchases, usually at restaurants.

If you had £10 in vouchers, you could receive £40 towards the partners, again usually restaurants, towards your purchase of food.

Not too shabby.

The programme has changed and while you can still acquire points, for now, the supermarket has introduced a monthly fee of £7.99, which allows you other discounts, like 10% of two (2) big shops a month.

As to if the new scheme is worth it, that depends on the household. £96 a year for the card means you need to get some real savings for it to be worth it.

Co-op: The Co-op membership card also offers cash back on various purchases, and also promises to put money into the community.

You earn cash points which can be used for future purchases.

There are no vouchers to be posted out, you simply gather points on the card, and if and when you choose, you can use the points as cash on purchases.

Simple and easy, and a way to save up some money for future purchases.

There are may more loyalty programmes available, and as mentioned so many shops and stores have them. As long as you don’t mind carrying all the cards with you, many of them are a great way to be rewarded for being a loyal customer.

This is a much better business model or mindset than the broadband, and utility providers and other services that only reward new customers, and not existing customer.

Cashback Credit Cards

Another way to “save” or build up points in the form of cash are cashback credit cards.

Much of this with credit cards began years ago with credit cards partnering with airlines and offering air miles depending on your credit card purchases. You could build up air miles to be used towards flights.

These became so popular that even in divorces people would place the air miles as a part of the divorce papers as to who gets what.

Cashback credit cards can be a great way to build up some cash back for future purchases, or towards something such as airfares.

Recently Amex (American Express) began offering a cashback card based on purchase and also how fit you are.

Amex has partnered with an insurer, and depending the level and amount of exercise you do, you can earn points.

Not a bad idea, especially if you like to stay fit. Plus, the healthier you are, the less likely you are to place a claim to the insurer.

While cashback credit cards can be good, and have their place, there are a few things you need to be aware of, one being the use of the card.

If you use the card(s) for regular purchases and pay off the balance(s) each month, great; the programmes work for you. However, if you continue to carry a balance on the card, and looking at the interest rates charged, it may not be a good deal at all.

Then you also need to review the interest rate being charged, and if there is a 30 day no interest period, this so you can pay the balance off each month without being charged a fee or interest.

For some large purchases, the use of a cashback credit card can be a very good idea.

In the end, loyalty cards and cashback credit cards all have their place in our looking to save and seeking a bargain world, especially if we are going to shop, eat, spend there anyway.

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