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I was buying a present at a book store a few days ago when the cashier asked whether I'd like to be part of one of their loyalty programs: $35 would buy me a 10-per-cent discount on a year's worth of shopping at the store, or 5 per cent if I shopped online.

Hmm: Pay cash up front so that I would have to return to the store in order to spend $350 because I feel I must try and make my money back? I politely declined.

Loyalty programs are like religion -- either you're a true believer, or you're not. The first group loves the idea of getting something for nothing. (One of my colleagues went all the way to China and back on her reward points.) The second group cannot be bothered to collect points, even if it means leaving money on the table.

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Apparently, it's also got something to do with the Great Male-Female Divide. Women are more likely to have more than one loyalty card than men (80 per cent vs. 69 per cent), according to Patrick Sojka at Rewards Canada. Men tend to have more credit cards (61 per cent, compared with 53 per cent of women), plus men think they have too many and are eager to reassess which cards work for them.

There are two types of loyalty programs: One rewards you for shopping at a particular store and the other gives you points for using a particular credit card (which is, actually, kind of the same thing).

If you're into collecting points and redeeming them for freebies, here are a few tips:

1. Pick your favourite places to spend. You earn rewards based on how much you shop at a certain store, so make sure you don't spread out your spending at rivals. For example, if you get a free cup of coffee for every 10 that you buy at Starbucks, don't make yourself wait even longer by getting your fix at Second Cup half the time. Pick one retailer and try and go there as a matter of course.

2. Think about what you're buying. Retailers use loyalty programs to try to get you to buy more than you would have purchased otherwise. Don't buy anything you wouldn't have bought without the card, and check to make sure you really are getting the best available price.

3. Think carefully before paying to be part of a loyalty program. It only makes sense if you're going to make your money back. Do the math: How many points do you earn for each dollar that you spend? You may need to spend $9,000 plus your $120 credit card fee to get that free toaster, for example.

4. Points expire. If you are collecting frequent flyer points, use them fast, or at least keep your account active. Less than 30 per cent of those who belong to a rewards program actually book travel using their points, recent studies show.

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5. Swap 'em. If you feel you are never going to be able to accrue enough points for a vacation, take what you have earned to a website like or You can trade your points for other points that you can actually use, or you can simply sell them. Some companies also let you donate them to charity and will match the donation in dollars.

6. You have to keep your rewards card handy. I used to have Canadian Tire money scattered through a drawer at home. What good does it do me there? You can punch a hole in one corner of each card and then string them on a carabiner and keep them in your purse so that you can find them easily.

7. Cash works everywhere. If you don't like shopping at any one particular store that offers reward points, cash rewards are the solution. It is fairly standard to get 1 per cent back on a no-fee credit card. You can compare different cards at websites such as or Red Flag Deals.

Finally, remember: There's no such thing as a free lunch. Card companies and shops that redeem points have to pay for them from somewhere -- and that somewhere is you. They are generally passing the cost along to consumers through higher prices, and then giving them something "free" in return.

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About the Author
Deputy head of Audience

Sonali Verma is deputy head of audience at the Globe and Mail. She is a business journalist with more than 20 years of experience, mainly in digital media.She was previously the Globe and Mail’s senior editor in charge of audience engagement, overseeing its homepages as well as social media operations. More

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