Credit Cards: Using Loyalty Points to Your Advantage | Refresh Financial

Credit Cards: Using Loyalty Points to Your Advantage

There are countless credit cards out there that offer you rewards of some kind. These rewards card can come in many different forms. Some cards will give you rewards points at your favourite retailers, other might reward you with travel miles or free nights in your favourite hotel chain. Some cards earn you free gas as you use them and some give you cashback on all your credit card purchases.

Tips to maximizing credit card loyalty points

Loyalty points at your favourite retailers can come in incredibly handy, as most of the time, the points value reflects a dollar amount that can be spent in store. Using your credit card in a strategic way can earn you loads of loyalty points in very little time and can result in you being able to purchase things you need at no cost every once in awhile. It is absolutely worth it to learn all you can about earning loyalty points on your credit cards.

Here are a couple things you should be on top of when trying save money each month by getting the most out of your loyalty points.

1. Do your points expire?

It’s important to find out if the points you are collecting expire over certain periods of time. Otherwise, you could end up saving a ton of points for a specific occasion only to have them all disappear before you use them. There are quite a number of rewards cards and loyalty programs that put a time-limit on when you can use the points you’ve earned. A simple way to stay on top of expiry dates is to keep a calendar with reminders on your smartphone. Letting those hard-earned points slip away with time is like money dropping from your wallet as you walk down the street.

2. Is there a daily limit or purchase limit?

It’s possible that your rewards card of choice has limits placed on either the amount of points you can collect per day or on the size of the purchases you’re collecting points on. These limits can be circumvented by making your purchases over the course of a few days, or by making a few smaller purchases rather than one large one. It’s important to familiarize yourself with the limits you may have on earning points so that you don’t miss out on all the ways to save money!

3. Look for bonus deals

Shopper’s Drug Mart often has 20x points events and offer coupons for bonus points on certain purchases. Many retailers do the same: at Safeway certain products will often be advertised to earn you extra Air Miles; at Real Canadian Superstore, spending over $250 can sometimes earn a whopping 25,000 point bonus. It absolutely pays off to stay on top of such events and bonus opportunities and the best way to do that is to sign up for your favourite retailer’s newsletters, watch for their fliers, follow them on social media and mark the dates in your smartphone with a reminder.

4. Are there any additional fees?

Often credit cards come with an annual fee, and some cards have high-interest rates. If you’re using your card to earn points, but spending more than you earn in fees, you’re still in the red and you haven’t really saved any money at all. Familiarize yourself with what it costs to use your credit card and if you find it costs more than you’re earning back, consider switching to a credit card with no annual fee and a lower interest rate.

Stay on top of your credit card loyalty program

Understanding your points reward program and familiarizing yourself with the fine print is going to enable you to take full advantage of them. Doing so can have a massive impact on your financial situation, whether you’re earning free gas, travel miles or points to redeem.

Loyalty points should definitely play a part when you’re planning how to save money every month. You should also consider collecting points as a way to soften the hit your finances take during the holidays. Spend all year saving your points and use them for gifts, food and supplies during the Christmas season. You can earn even more by using your card to pay your regular bills, and then by paying off what you’ve just put on your card right away. This strategy is also great for your credit report.

Many Canadian consumers overlook the savings power of loyalty points, but don’t let that be you. A little bit of reading and a few minutes of planning and you’re going to be saving money every month with your points like a pro!

Find out how to save money every month on the Refresh Financial blog. We explore ways to save money, ways to rebuild your credit, and more.

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