When the coronavirus outbreak passes and the economy starts to rebound, we can get back to racking up travel rewards through our loyalty programs.
“Right now, travel points are worth almost nothing,” says Stephen Weyman, an expert on loyalty programs and co-founder of the websites HowToSaveMoney and CreditCardGenius.
Cashback cards are a practical alternative. Another is a program like PC Optimum that offers points redeemable for groceries and drugstore items. Rewards like these are basically like cash you can use to lower your bill at the supermarket or drugstore.
If you’re an Air Miles collector, Mr. Weyman suggested switching to the cash option from dream. Cash miles can be redeemed at the cash register to reduce your bill in increments of $10, while dream miles are for travel, merchandise and events or attractions.
RewardsCanada highlights cashback as an alternative to travel rewards, but offers a warning that some cards in this category only let you access the cash you’ve earned once a year. Also consider merchandise and gift cards for redeeming your rewards. Merchandise is one of the worst values in loyalty points redemption, RewardsCanada says. “But if your toaster at home breaks and you need to conserve cash, then yes you should look at using points or miles to get yourself a new toaster.”
Some credit cards let you choose the reward you want – cashback or travel. RewardsCanada lists a few of them here. A favourite card on this website for both cashback and travel rewards all in the same card is American Express Cobalt.
If someone has lost a job or had their income cut, reward points and cashback can be a financial asset that lightens the load. Check your cards to see how many points you have and what they can be used for. “I never recommend hoarding reward points,” Mr. Weyman said. “But if you happened to have hoarded them this this might a good time consider using them if you lost your job or income.”
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How to invest in turbulent times
Globe and Mail market strategist Scott Barlow and I did a call-in for Globe subscribers on how to invest right now. You can listen here.
Attention Globe subscriber retirees
The Retirement Forum is a place for Globe and Mail subscribers to discuss matter related to retirement. The current must-discuss topic is the most violent stock market decline in memory, caused by the spread of the coronavirus. If you want to share your thoughts, join the conversation here.
Our next Globe subscriber call-in, also on the topic of retirement, is planned for Wednesday March 25 at noon (ET). Join me and personal finance editor Roma Luciw as we answer your questions. Check the Member Benefits page to register and send in your questions ahead of time.
Rob’s personal finance reading list…
What if you can’t pay your mortgage
Veteran mortgage broker David Larock has prepared a 10-point briefing on the six-month mortgage deferral offered by the big banks to people experiencing financial hardship as a result of the coronavirus. Check out #9: You have other options besides deferral, including an extension of your amortization to lower monthly payments.
CBC has documented the frustrations people are having in trying to take advantage of the mortgage deferral.
Here’s a thorough checklist of steps you can take if economic challenges make it impossible to pay your mortgage on time. From deferring your payments to selling your home.
Real estate rocks, even in the time of the virus
Buyers were still bidding aggressively for homes in Toronto and Vancouver last week, possibly because they see no let-up in demand for homes once the coronavirus crisis passes. I’m more interested right now in how people who bought homes recently and stretched their finances to the max will make out in an the economic downturn ahead.
It’s a stressful time for kids, too
A lot of households are going to be worrying about money in the months ahead. Here’s a guide from the non-profit Canadian Federation for Economic Education on bringing kids into discussions on family finances and teaching them some money basics.
How to get through a stock market crash
One blogger’s take on plunging stocks and the buying opportunities emerging. He lists the exchange-traded funds he’s eyeing. Here’s some advice on looking for stocks that you can buy now on sale and hold forever.
Q: In an article you wrote, you say there is more downside to the market indexes. Tell me how you know that?
A: There’s a recession coming, but we don’t know how bad. This uncertainty will weigh on the stock markets and likely cause more down days to come in the months ahead. I haven’t lost faith in stocks. They will rebound at some point, probably in a hurry.
Do you have a question for me? Send it my way. Sorry I can’t answer every one personally. Questions and answers are edited for length and clarity.
Today’s financial tool
How much toilet paper do you really need? This online calculator will tell you long your current supply will last.
What I’ve been writing about
- How to minimize damage to your credit score through the financial slog to come
- A realist’s personal finance guide to the recession ahead
- Rob Carrick’s 2020 ETF Buyer’s Guide: A stress test of Canadian Dividend ETFs (for Globe Unlimited subscribers)
More Carrick and money coverage For more money stories, follow me on Instagram and Twitter, and join the discussion on my Facebook page. Millennial readers, join our Gen Y Money Facebook group. Send us an e-mail to let us know what you think of my newsletter. Want to subscribe? Click here to sign up.