Did you know you can basically live for free by using loyalty cards and rewards credit cards every time you shop? You could get Avios, free days out with the kids, in-store discounts, spa trips and all kind of freebies without spending any more than usual. We’ve got a list of the best reward cards and how you can combine them with loyalty cards.
- Living for Free – making the most of your reward cards
- The best rewards credit cards
- The best loyalty cards
Are you making the most of your spending and getting as much as you can for free with it? If you are able to pay off your credit card bill every month then you should be using a card that gives you rewards for spending – either cashback, Avios or points. Even if you can’t pay off your credit card bill (or you don’t want a credit card at all) you should at least be making the most of store loyalty cards wherever you shop.
1. Use several at the same time if you can. So, for example, if you are in Tesco doing your usual shop, buy the stuff with your Lloyds TSB Avios Duo card (you get ten times the Avios using that one rather than the Mastercard version) and hand over your Tesco loyalty card as well to get the points. That way you get Tesco points and part of a free holiday at the same time.
2. Always remember to use them. It’s easy to forget but if you get into the habit of making the most of your cards it gets easier. It’s even harder to remember to use your card online. With Nectar you have to login through their website, and it’s just another box on most other sites. But if you to get into the habit of getting it out of your wallet with your payment card, you should get all the points you deserve.
3. If you can find something cheaper somewhere else, buy it there. The amount of reward points you get is never going to make up for spending more than you have to. Also, don’t ever allow yourself to be conned by the shop enticements to buy something just because it happens to have double points on it this week. If you would buy it anyway then go ahead but don’t be gulled by their clever ways into buying something you don’t need or could get at a better price elsewhere.
4. Use your points! It’s amazing how many of us collect up points and rewards and never get round to using them. Take a little time out one evening to look through the possible rewards at Avios, Nectar, Tesco, Boots and others and set yourself a goal of something to work towards. It could be dinner at ASK using your Nectar points or a trip to Paris on Eurostar using your Avios or a family outing to Legoland using your Tesco points. A good way to make the most of your reward points is to use them at theme parks. When you compare the amount you’ve spent to get the points with the value of the reward – theme park tickets come up trumps. Scarily, you’ll probably have to spend around £2,150 to earn enough points for one ticket, but as you’re going to spend the money anyway, it’s a fab way to save yourself £35.
We’re all different so it’s up to you which credit card with rewards is right for you. We give you a run-down of all the latest offers in our reward credit cards article but here are the main ones for you to consider:
If you want cash back
Barclaycard High 5 Cashback card. You’ll get 6% cashback on your five biggest monthly purchases for the first three months up to £120. After that you’ll get 2% on your five biggest monthly purchases and 0.5% on everything else. You’ll also get 0% interest on balance transfers for the first nine months (2.9% fee). Each year you’ll get a bonus of 4% cashback on your top five purchases in the month after your card anniversary.
Capital One Aspire World MasterCard. This card offers 5% cashback for the first three months up to £100. Then rates vary: if you spend under £6,000 you can receive 0.5% cashback, those spending between £6,000 and £9,999.99 will receive 1% cashback, while spending over £10,000 will gain you 1.25% cashback. Complicated, we know, but if you’re going to spend over £10,000 this is the best overall rate.
Santander’s 123 cashback credit card is also a great deal, where you receive 3% cashback from petrol stations, National Rail and Transport for London travel; 2% from department stores and 1% at supermarkets. You can only get cashback at petrol stations for up to a spend of £300 each month, but department stores and supermarkets get cashback on spends up to £1,000 a month.
If you love to travel
Lloyds TSB Avios Duo (Jasmine has this one because she loves getting free flights). This account gives you two credit cards; a Mastercard and an American express card. With the American Express card, you earn one Avios for every £1 you spend and one Avios for every £5 you spend with your Avios Duo MasterCard.
British Airways are also running an Avios scheme with American Express. You get 1,000 free bonus Avios when you sign up for the card and spend £500 within the first three months, then it’s one Avios per £1. There’s no annual fee and the APR is 15.9%. You also get travel accident benefit up to £75,000 with the card.
If you just love shopping
Similarly, the Marks and Spencer Credit Card will give you one point for every £1 spent in Marks and Spencer and one point for every £2 spent elsewhere. 100 points will get you a £1 voucher, which you can then spend in Marks and Spencer. Even more amazing is that the card gives you your first 15 months of shopping interest-free!
The John Lewis and Waitrose partnership MasterCard gives you one point per £1 spent in John Lewis, Waitrose and Greenbee. You also earn one point per £2 when you spend anywhere else. Every 500 points are worth £5.
Earn one point for every £4 you spend at Tesco or Tesco.com with the Tesco Clubcard credit card. It also has 16 months at 0% on purchases and a typical APR of 18.9% with a handling fee of 2.9%.
Sainsbury’s Bank Mastercard is a good one even for those who don’t pay off their balance every month. It gives you ten Nectar points for every pound spent in Sainsury’s for the first three months and you’ll get 0% on all purchases for six months and 0% on balance transfers for 15 months. Not too bad for Sainsbury’s fans.
Anyone can have loyalty cards and really if you’re going to be spending money in shops that offer loyalty points, you might as well go for them.
Why do shops offer loyalty points?
It’s for two main reasons:
- To keep you coming back to the shop to spend your money – hence the name ‘loyalty’ cards. The idea is that you get excited about collecting points in their store so you keep going back and keep spending. Make sure you don’t do that – just go in if you would anyway and only buy what you normally would. Don’t be tempted into spending money just to get the points.
- Marketing – It’s extremely valuable to the shops to know what their customers are buying, how often they come in, what kinds of deals they go for etc. By swiping your card each time you shop they can track your shopping habits and possibly offer you tailored discounts to get you to shop more. Some people really hate this side of the business so if you feel uncomfortable with these stores knowing your shopping habits then don’t get a loyalty card. However, do remember that millions of people do have these so it’s not as if they are watching you personally as you go shopping. You’re just a number to them.
You could have all of the loyalty cards or just ones from your favourite stores. Here is a list of the best ones.
Tesco Clubcard is a big loyalty card scheme with loads of partners for you to make the most of.
How do I collect? To apply for your simply pick up a leaflet and temporary card in store or apply online. You can start collecting on the temporary card straight away, though we have heard tales of the real thing taking a while to arrive In Tesco stores you get one point for every pound you spend. On the Tesco phone range and Tesco broadband and you’ll receive three points for every pound you spend. Simply swipe your card in Tesco stores to collect your points, or quote your clubcard number when buying any Tesco phone services. You can also collect with Tesco’s partners, like Blinkbox and E.ON. Just quote your clubcard number when speaking to the company to collect your reward points. You’ll get one point for each pound spent with each company.
How do I spend? Of course, the spending is the most exciting part – and with your Tesco Clubcard there are loads of spending options. Once you’ve collected 150 points, Tesco will send you vouchers equivalent to the number of points you’ve collected. Each point is worth 1p, so you’ll get a £1.50 voucher for 150 points, a £5 voucher for 500 points and so on. When you get sent your vouchers, you’ll also receive other vouchers offering you things like double points on certain items or free bags for life, as a way of making the most of your money. You can either spend your vouchers in Tesco to get money off your weekly shop, or (better) you can save them up to exchange for loads of other great rewards. If you’re collecting Avios then you can get 600 Avios for every £2.50-worth of Tesco points. Just go to the Avios section of the Tesco website and follow the instructions. This table highlights some of our top picks:
|How many vouchers?||What do you get?|
|£11.50||One-day Alton Towers ticket|
|£22.50||Ticket to Jersey Boys|
|£10||£40 in restaurants like Cafe Rouge, Prezzo and Pizza Express|
|£10||£40 in Hilton Hotels|
|£14||Annual subscription to Good Food magazine|
|£10||£30 at Goldsmiths|
|£26||Ticket to Shrek The Musical|
|£9.50||One-day wristband for Blackpool Pleasure Beach|
You claim different rewards in different ways. For things like Alton Towers or theatre tickets, you need to visit the Tesco clubcard website and select which deal you want. You can then exchange your vouchers for a token, which you present at the theme park or theatre. And these type of rewards will have a ‘buy in full’ tab next to the deal on the site, so it’s easy to tell which ones they are. For vouchers for restaurants and days out, you exchange £2.50 worth of vouchers a time, for £5 worth of deals vouchers. You can then collect these up and use them in one go at places like Ask and Varsity. On the website, simply add them to your basket and type in your Clubcard number when you reach the checkout page. You’ll then receive the vouchers in the post.
Nectar estimates that nineteen Nectar cards are swiped every second. With over 50% of UK households and dozens of companies participating, it’s one of the biggest reward schemes around. So whether you’re buying petrol from BP, enduring your weekly shop at Sainsbury’s, tucking in to a family meal at Beefeater or buying the latest DVDs from Amazon, you could be collecting Nectar points. This huge range of partners also gives you loads of places to spend your Nectar points. How to collect: To get your nectar card simply apply online, or pick up a form in a participating shop. Then it’s time to start shopping! We’ve highlighted some of the best Nectar partners in this table:
|Where?||How many points?|
|On the high street|
|Sainsbury’s||Two per £1|
|Vision Express||Two per £1|
|Halfords||Two per £1|
|RAC||1,500 when you sign up for cover|
|Hertz||1,000 for a pre-paid booking|
|Amazon||Two per £1|
|Argos||Two per £1 (four points until 4 October 2012)|
|eBay||One per £1|
|Expedia||200 points for hotel, flight and car bookings, 1,000 points per tailor-made package|
|HMV.com||Two per £1|
|Food and drink
|Thorntons||Two per £1|
|Majestic Wine||Two per £1|
|Homebase||Two per £1|
For a list of all the places you can collect points, visit the Nectar website. To collect your points in high street shops or restaurants, simply hand your card over when you’re paying. And when shopping on the web, log in to your Nectar account and click through the links there.
Where to spend them
You can exchange your points for money off in stores like Sainsbury’s and Argos. 500 points can be exchanged for £2.50 off your shopping by swiping your card. Or if you fancy a bigger treat, you can also spend your Nectar points on free travel all over the world, with ebookers and Eurostar and treat yourself at Legoland, Alton Towers and Thorpe Park (double points, so for 500 points you get £5 off your bill).
You can also exchange your Nectar points for homeware, electrical goods, books and gadgets. Just look on the Nectar site.
Boots advantage card
The Boots Advantage card scheme is another huge player in the UK loyalty market. It’s also one of the most generous schemes around, offering four points for every £1 spent. Each point is worth 1p, so for £1 you get 4p back. The card does have its faults. For example, you can’t combine your points with cash to act as a discount, so have to wait until you can pay for your item with your points alone.
You also get loads of special offers just for owning the card including the free Health and Beauty magazine (available to Advantage Card holders), along with health and beauty tips. In larger stores, you can also make the most of the Advantage Card Extra Offers Kiosk. Enter your card into these special booths and you can take a look at all the money-off coupons and extra points offers available. You then select the offers you want, print them off and start shopping.
John Lewis and Waitrose partnership card
This is a credit card, but as John Lewis and Waitrose don’t have a loyalty card it’s one way to make the most of the money you spend instore. Just remember – it’s best to pay off your credit card as soon as you get home from your shopping trip. Leave it too long and you’ll end up making hefty interest payments on the debt. With the partnership card, you earn one point for every £1 you spend in Waitrose and John Lewis, whether it’s in a branch, online or through their catalogue. Because this is a credit card, you get the points simply for paying with it, so there’s no need to worry about typing in extra numbers or remembering to swipe it. Every 500 points you earn will be converted into £5 worth of vouchers to spend in John Lewis or Waitrose. And you also get extra benefits and special offers.
Shell Drivers’ Club
There are also reward cards that let you save money on petrol. With the Shell Drivers’ Club you get one point for every litre of fuel you buy. Once you’ve got 500 points you receive a £2.50 voucher for Shell. To sign up, pick up a form and your card in Shell petrol stations.
So, do you think loyalty cards are worth it? Do you have any tips for other readers on making the most of your points? Let us know what you think by commenting below.