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Customer Loyality Rewards - Who Has The Best Deal?

I just started to really collect these things but like most people, only have a limited amount of money spend and thus would like to maximize the best way to explolit the point system the best way possible. I actually use these point systems, so I can reveal my findings here. I am sure there are many others like Office Depot and Staples but I don't really use them enough to make a comment.

Some Of The Popular Reward Point Systems
Reward Card
Points Given on $1000
Annual Cost
Return Value
Gift Cards
Airmiles Mastercard Bronze
Airmiles Mastercard Silver
Airmiles Mastercard Gold Westjet
American Express Airmiles
Mosaik Cashback Mastercard .5%
1 pt = $1.00
Mosaik Cashback Mastercard 1%
1 pt = $1.00
TD Rewards VISA
1 pt = $1.00
Superstore (PC) Mastercard
1 pt = $0.001
1 pt = $0.001
Shoppers Drug Mart Optimum
7000 pt = $10.00 (1 pt = $0.00143)
3000 pts
HBC (Bay, Zellers, Home Outfitters)

Airmiles Reward Program

a) Probably one of the first Reward Card systems out there started back in the early 90's. I had my card for years upon years, and just using it to buy the occasional stuff at Safeway and Boston Pizza, I amassed over 800 points in 10 years. So I have enough points to fly somewhere in BC after 10 years. What a load of shit. Obviously, buying things with Airmiles alone is not the way to do it, because you can only shop at those dealers who support it and places like Safeway, have got their prices jacked up so that the Airmiles savings are quickly lost by the high mark ups.

b) So thus you must get one of these credit cards like MasterCard or American Express. That way, you can buy things cheap at the competition and still get Airmiles for it, and as an added bonus you can get double the Airmiles when you do buy something from say Safeway. Example, when I go to buy $100 at Future Shop on my AMEX, I will get 5 Airmiles from it. When I go to Safeway to buy $100 on stuff that is on sale (that is the only time it is worth while buying stuff there) then I will get 5 from the AMEX card and 5 from Safeway on the same $100 purchase.

c) So I charge just about EVERYTHING through that AMEX card when ever possible, right down to the Slurpee at the 7-Eleven. Not everyone takes AMEX but most of the big retail outlets will, Future Shop, London Drugs, Shoppers Drug Mart, even KFC. At over $1000 a month, I get over 50 Airmiles a month.

d) Pay as many of your bills using your rewards card. Many utilities can be paid for using cards, example: Telus, Fido, Primus, Rogers, and Shaw. Hey if I gonna have to spend $40.00 for my cell phone bill, may as well get the 2 Airmiles from it too. Don't forget Primus already gives you Airmiles too, double dip!

e) Silver Mastercard and Gold Mastercard for the Airmiles are kinda useless. Ok, Silver card rewards you the same as the AMEX but it dings you $35.00 a year. Thus an Airmile is about 10 cents, that works out to an annual cost of 350 Airmiles. They give you a one time bonus of 150 airmiles to sign up, big whoopie shit, because that will defray the cost to 200 Airmiles. At $1000 a month, that is 50 airmiles a month, thus you just wasted 4 months of the year paying for the upkeep of the stupid card. As for the Gold one, at $90 a year, but nothing from WestJet costs you over 1600 Airmiles, well, at $1000 that would be pretty useless because you could have bought a WestJet ticket for less. Maybe if you hit $10000 per month and you flew a lot around North America, then this card might be useful. Then again, if you made that much money, why would you sweat the chump change?

f) So what is the real low down? Ok, lets say I spend $1000 on my AMEX card a month, that would be 50 Airmiles. It takes 350 Airmiles to buy something with a good point to dollar conversion rate like a $50.00 Rona gift card, thus 7 months ($7000) to earn $50.00 worth. That is a return rate of 0.714%. So not as good as some of the 1% cash back reward programs, assuming you don't apply any double dipping. Even myself, I don't double dip often, around 10% is my usual, so if I apply that, it would have only taken 315 airmiles, a bit shy of 6 months, however, it would saved me 35 x $20 = $700 in points, and inproves the rate of return to 0.79% (big whoopie shit).

Cash Back Reward Programs

a) A rather old concept with a new face introduced the credit card companies. Since they ding the vendors up to and exceeding 5% of the transaction, isn't SOOOO generous of the credit card companies to give us back 1% lousy percent? In the past, they donate it to some charity or school alummi or something like that. So now, they give it back to you! Oh well, better than a kick in the head.

b) The best one I have found so far is the TD Canada Trust. It is totally free. It gives you 0.5% cash back for the first $3000 you spend, thus $15. Then will give you back 1% for the next $22,000 ($220.00). The top spending limit is $25,000 a year. Still pretty cheap since they could be making up to 5% off the vendors for carrying the VISA name.

c) Mosaik Mastercard is a load of shit, just like their Bronze and Silver Airmile cards. They will give you 0.5% back with the free card which is the same as everybody else. In order to get the 1% back, you need to PAY them $49 for an annual fee. At 0.5% cash back spending $1000 a month, that is almost 10 months of upkeep. So back to my point again, if you are spending $10,000 a month, why in hell should you be sweating the small change?

In Store Reward Programs

a) Real Canadian SuperStore (President's Choice) Mastercard

It isn't a free guaranteed card that anyone can get like a Safeway card. However, it does allow you to get points for any of your purchases on Mastercard and a slight bonus kick for President's Choice products. The rate is 10 points for every $1.00 (thus 1 point for every 10 cents) and the redemption rate is 20,000 points for $20.00. Therefore, spending $1000 a month will give you 10,000 points, thus in 2 months you will have 20,000 points which is enough for $20 back, which is a rate of 1%. Lo and behold, that is the same rate as the other Cash Back Reward programs.

b) Shoppers Drug Mart Optimum

This card is free, and anyone can get one. It is only good at Shoppers Drug Mart, but it does have a lot of free promotions and free points. It probably is the least nonsense of the all the cards. The rewards are simple to get to and get better if you stock them up. 3500 ($350) gets you $5.00 {a rate of return of 1.43%}, 7000 ($700) gets you $10 {same as 3500x2}. 15000 ($1500) gets you $25 {1.67% return}. 30000 ($3000) gets you $50 {same at 15000x2}. 40000 ($4000) gets you $75 {return of 1.875%} and 75000 ($7500) gets you $150 {rate of 2%}.

So as you can see, one of the best rates of return for the dollar. Then again, who really spends THAT much money at the drug store who isn't drugged up on prescription meds?

c) CIBC Optimum VISA

Gives you 5 points for each $1.00 you spend. You earn an additional 50% more points when you shop at Shoppers Drug Mart because a $10 purchase would give you 100 points from the Optimum side, and 50 more points from the VISA side for a total of 150 points on the one transaction. They give you 3000 points for the applying for the card, which is almost $5.00 in reward. So spending $1000 a month on your VISA will give you 5000 points. Which would have netted you the first discount break of $5.00 (a return of 1.43%) right away with change to spare.

d) HBC card

50 points to the $1.00. Double dip with the Mastercard or HBC card to get another 50 points. You can use 2000 points for 1 airmile, 40000 minimum (ie. $800.00 worth converts to 20 airmiles, a rate of return of 2.5%). HBC card for 200,000 of $25.00. So that is actually a little bit better rate than what airmiles would have offered. The best bang per point to redeem is the HBC gift card. $100 for 800000, $50 for 400000 and $25 for 200000 which are all the same rate of return which is kinda stupid. Really, why in the hell should I burn 800000 points on one $100 card when I can just get 4 x $25 cards instead, no real incentives to save your points up. It is the same rate as the conversion to airmiles, but there is no real incentive to convert from a higher yeilding point return system to a lower point return system.