advertisement


Money Expert
You are here: ninemsn > Money > Money Expert
Rated: |

Don’t go silly over rewards points

Thinkstock Images
Thinkstock Images
TRIPLE YOUR FLY BUYS. Does that send you straight to the mall for some shopping? Even worse, does it encourage you to buy something you don’t need?

Like every other Kiwi I have rewards points cards putting undue pressure on the stitching of my wallet. I have a Onecard, Fly Buys, the AA Smartfuel card, and my ASB True Rewards card. Even so, I’m a real cynic about them. It feels like you need to spend tens of thousands of dollars to get a toaster or toothbrush.

In my humble opinion shopping decisions should never be made on the Fly Buys or other points that can be earned. At the time of writing Noel Leeming was offering 111 Fly Buys points on a Fujitsu ASTG18 heat pump. The only trouble is that those Fly Buys by my reckoning were worth just under $20*. Yet you could buy the same heat pump at Mitre 10 for $200 cheaper than Noel Leeming.

Here are 10 things you need to know about rewards points.

  1. Loyalty costs money. As with the example above, if you only shop with Fly Buys retailers you may be costing yourself money instead of getting a benefit.
  2. Some bank credit card rewards are better than others. I’ve done the maths many times over and I’m convinced that the ASB’s True Rewards offers the best value, although the independent researcher Canstar rated Westpac’s hotpoints as top dog.
  3. Air points are not what they’re hyped up to be. Personally I’m against air points cards such as ANZ’s Airpoints Platinum card. I think most people are better off using cards with points that can be redeemed at multiple retailers. I do accept that there are cards such as Kiwibank’s Go Fly cards, which offer early access to Grabaseat fares, which will be financially worthwhile for a minority of readers.
  4. People don’t redeem their points. Too many people don’t get around to using their points. Some points such as Fly Buy points do expire – although you should get a reminder via email or snail mail.
  5. It’s not found money. You’re only fooling yourself if you use your Fly Buys or other points to treat yourself on something you don’t need. You’ve worked for that money and it should be treated like any other money you earn. Buy things you need.
  6. Annual fees eat into your rewards. Credit card rewards cards invariably have an annual fee, which may be around $80. According to Canstar’s figures you’d need to spend around $12,000 a year on the card just to cover the fee.
  7. Always ask if you can use your card. It’s not just the supermarkets and well-known retailers that give you points. At AA Smartfuel, for example, you can shop at small retailers such as Dive HQ, Fingerfood Catering Company, and Nappies Direct.
  8. Loyalty points can be a bonus. They’re a bonus if you would shop at that retailer anyway. For me, for example, I’ve decided to be a Contact Energy client anyway, and the most convenient supermarket is New World. So I’d be shopping there anyway.
  9. Use your loyalty points tactically. If you can, take vouchers that you can spend at your leisure and then wait until the Kitchen Wizz, or whatever it is you want, is on sale. Or spend your points at the supermarket, which effectively turns them into cash. Put your supermarket budget for that week away for something else.
  10. We’ll use our phones in future. One good development for loyalty cards is that they can already be loaded into smartphones, meaning there is less chance of leaving them behind.

*At the time of writing a Breville Wizz Chopper and Shaker was offered on Fly Buys for 220 points. That same device cost $39.99 at Noel Leeming, which meant that one point was worth 0.18c.

Your say: how do you use your rewards points cards?

Links:

What not to buy
Temptations to avoid
Credit cards: the good, the bad and the evil
The 10 biggest money wasters of all time
Credit card rewards worthless for many

User comments
What a great article. I don't go out of my way to earn my flybuys and it takes ages to earn but I have always tried to find what I thought was the best value for redeeming but I think you've swayed me on taking the vouchers in future, never looked at it that way. My favourite rewards though are the Nescafe cup of rewards. Totally something I buy multiples of each month and good rewards too.....though now it'll be vouchers.
Throughout the course of the year, my mortgages with BNZ totalled around 40k-50k. I was on their Flybuys program for paying my mortgages with them. When my accrued points were almost ready to expire, I went in to Noel Leemings to redeem them. I had a bit over 3,000pts. All I had enough for were 2 small hand held walkie talkies, and a Navman GPS for my car - a total 'retail' price of about $329.00 by memory.Probably half that at cost. The amount of points I gained did not include approximately $6,000 worth of fuel at the SHELL service stns either! There will be a Loyalty Card Program on the market one day that will make all these so called "rewards" cards seem insignificant! It is only a matter of time before a "real" reward card comes on to the market that will make a 'real' difference to the consumer for making their evry day purchases! Bring it on I say. Show these other Loyalty Card Companies up and give us a truly great deal!

Write a comment
Email: *
Your email will not be shared with any third parties or published with your comment.
Nickname: *
Location: *

Title:
*
Comment:
*
Maximum characters 1000

Comment guidelines > View full guidelines
Avoid using:
  • Personal attacks
  • Irrelevant comments
  • HTML tags
  • Personal information
  • Offensive language
  • Text in ALL CAPITAL LETTERS
comment guidelines X
Thank you for sharing your opinions with other users of NineMSN. People will find your comments more helpful if you include relevant information and avoid some common pitfalls.
Please note: All reviews and comments submitted are subject to moderation, NineMSN reserves the right to alter and / or remove any content that does not comply with usage guidelines.
What to include in your comment:
  • A title that briefly summarizes the opinion expressed in the comment.
  • Additional comments adding more detail.
  • Comparisons to other similar products, if this is relevant.
  • To create a new paragraph, press the Enter key twice.
What not to include:
  • Information that will quickly go out of date.
  • Comments on other comments or commenters.
  • Language that other users may find offensive.
  • comments of one sentence or less. Provide information to support your opinion.
  • Personal information like your email address or telephone number.
  • HTML coding. Tags like <b> or <i> will not be recognized.