This is a collaborative post by Ellie Jo.
Saving money should be more than a thought, it should be a way of life. You should always be attempting to save money somehow and put some cash away for a rainy day or emergency. There’s no end to the benefits of saving money, and that’s a fact!
By spending less, the money you save can be stashed into a savings account to go towards a big purchase one day. Or, you could even invest your savings in different assets and start to earn money from them! Like I said, the benefits are endless, which is why any opportunity to save money should be pounced on right away.
Everything You Need To Know About Saving Money With Loyalty Reward Systems
On that note, we’re going to talk about loyalty reward systems today. Now, they could be called reward programs, systems – or anything of the like – but they’re all the same thing. Essentially, we’ll be discussing things that grant you (the consumer) rewards for purchasing products or services from a business. Immediately, anything with the word ‘reward’ in will garner my attention. I like to be rewarded. Who doesn’t like being rewarded? I think I spend my money well, so when I part with my cash, it’s nice to know I may get something back in return too. Well, there are many different kinds of reward systems out there, and different ways in which they help you save money.
As such, to try and make sense of all this, we’re going to split this article up into sections looking at each of the common rewards systems you will find, and how you can save some of your hard-earned cash.
Loyalty Reward Points
The concept of earning reward points is highly common these days. In fact, it’s probably the most common type of reward program out there right now. The idea is very simple; you spend money, you earn points, you cash in those points for rewards. The more points you earn, the more valuable your reward will end up being.
How the points system works
Plenty of supermarket chains and coffee shops adopt the points system as their chosen way of rewarding customers. In some cases, you earn points that can then be used to buy products from the specific company. Costa Coffee is a good example of this; collect points using your Costa Card, and you could eventually have enough to pay for your next drink. I’ve seen the same concept on many online stores as well; get points, use them to pay for your next purchase. This helps you save money as you essentially get something for free. If you wanted to save up a lot of points over a long period, you might end up having enough to afford a massive purchase or to get loads of small purchases for free.
Is the Loyalty Rewards Point System a Good Way to Save Money?
This system is good if you have a particular loyalty to one store or business. If you always go to one supermarket, and you spend money there every week doing your food shop, then you should take advantage of the points scheme they might offer. Many people do this, shop, as usual, build up points, and cash them in during Christmas time. Here, they accumulated enough points over the year to potentially make the big holiday season food shop free! This is where I think the points system is good as you basically just get rewarded for shopping as you normally would. You haven’t got to spend any extra money, and you can save lots of cash on future purchases.
The Tier Reward System
The next idea is the tier reward system which focuses more on repeat purchases. Now, when saving money is the aim of the game, ‘repeat purchases’ are not something you want to hear. After all, you want to cut your spending not increase it! Anyway, with this system, it’s built around giving out better rewards to people that spend more money or continue to spend money. For example, let’s say you spend 20 dollars over time in one store, and you get rewarded with 5% off your next purchase. But, if you spend 100 dollars over time, you get a reward of 20% off, and so on. The more you’re willing to spend, the greater your reward will be.
How the Tier Rewards System Works
The rewards in the tier system are typically in the form of discounts like the examples mentioned above. However, they can often come as freebies too. I think Starbucks has a reward system like this with their loyalty card. I’m fairly certain it’s something like, if you buy five coffees you get a certain coffee free, then if you buy ten, you get a more expensive one free, and so on. Other companies use this same concept, and it can still help you save money.
Does the Tier Rewards System Help You Save Money?
The only way you’ll save with this system is if you’re a returning customer and spend a lot of money there. It’s kind of similar to the points system, but you don’t have rewards that you can build up and save. Once you reach the requirements for the basic reward tier, you then move onto the second tier, and so on. At this point, you can still save money. The discounts will help you save money, and if you use the shop a lot, then it makes a lot of sense.
Credit Card Rewards
This reward system differs from a lot of the others because of the fact you can get rewards almost anywhere. With most credit cards, you will accumulate points of cashback that you can claim whenever you want. You get these rewards whenever you use your card too, regardless of the store or retailer. Granted, there are now things like a Best Buy credit card that are geared towards rewards for one particular store, but the majority of cards reward you regardless of where you shop.
How Credit Card Rewards Work
Much like other reward systems, you can claim credit card rewards whenever you want. You can let them build up and up until you’ve got what you wanted, then cash them in. As for the rewards themselves, they come in many different varieties. In truth, many credit card vendors offer similar reward systems to what we’ve already mentioned in the form of a points system. You spend money on your card, accumulate points, and can cash these points in either as money back or to go towards another purchase. One of the most popular types of credit card rewards is air miles. This is where you earn points that go towards these air miles, and you can use your air miles to pay for flights abroad. In doing so, you could potentially save your family thousands of dollars on your big summer holiday every year.
Do Credit Card Rewards Help You Save Money?
The reason I chose to put credit cards in their own section is that you can use them anywhere to get points. With most other cards that use a points system, you can only use and cash them in at one store. Hence, credit cards offer something a little bit different. Plus, they have the added benefit of encouraging you to use your credit card, which will lead to a healthier credit score – if you use it responsibly. Instead of paying for things using your debit card, switch to your credit from time to time. This way, you can earn points as well as a higher credit rating. Then, use your points and transfer them into different rewards to help you save money on future purchases or just earn some cash back.
Which System Helps You Save The Most Money?
So, which of these three systems will help you save the most money? First, I want to add there are other reward systems out there as well. But, some are non-monetary and just won’t help you save any cash. Therefore, we included all three loyalty systems proven to help you save money.
The Best Loyalty Rewards System to Help You Save Money
To answer the question; credit card rewards are possibly the best – but only if you have a credit card and use it responsibly. You can earn rewards by shopping in various different places, which is a benefit the other two systems don’t give you. Loyalty points are second because you can build the points up for as long as possible before cashing them in. This is something you don’t get with the tier system, which is why it’s my least favorite.
Having said that, if you want to maximize the money you save, you should try all different systems from different companies. If you have a good credit score and can manage a credit card, then get one to use on big purchases to earn lots of points. No matter where you shop, check if they have a rewards system and then get on board with it. That’s the key here; only use rewards at places where you already shop regularly. This means you earn rewards without having to spend more than you usually would. Then, cash in all your rewards to save money, get things for free, and just generally end up spending less over the course of time.