Getting cash back: What’s the point?

I’ve posted repeatedly about rewards programs, cash back and savings opportunities that should, in theory, let you either get more for your money or get money back, which can be applied to what’s next.  But with so many programs and opportunities, with rewards that tend to be lukewarm or good only for certain timing, the question many times becomes whether it’s worth the time and energy.

My interest in programs has evolved since I enrolled in my first, MyPoints, back in 2003. The concept at that time seemed revolutionary to me, although I was 21, so what did I know?  All I knew was this site would send me emails, take surveys or have me make purchases clicking a link on their site, and I’d get points for those actions, which can ultimately lead to gift cards, a pretty nice reward. In ten years I’ve accumulated a few hundred in rewards, although I’ve been passive and could’ve accumulated more. Aside from one major purchase and a couple of smaller ones, I didn’t see a huge benefit from purchasing through the site, and the points value has seemed watered down relative to the effort required.

I’ve had better luck with programs that let me do what I do, and then reward me for it automatically.  Plink is a perfect example of this; all I have to do is remember to use the credit card that’s linked to it when I shop at the stores attached.  Given their store count maximum is five, that’s not hard, and in a few months I accumulated almost $100 in value off the program, for doing what I basically already was doing.  Not bad.

Then, of course, there’s reward credit cards.  I use them and pay them off at the end of the month to make sure interest charges don’t erode the value of the points.  The card I favor right now is the Marriott Rewards card, given the variety of options I have with it, including the ability to stay for free, which makes vacations easier to save for. I have two other cards; one is the one I have linked to Plink, and is part of the Citi Thank You program I previously mentioned. The third is a Bank of America card I’ve had forever, and at some point it converted into a points card.  All three are basically passive, are for various reasons my primary card for something, and have kicked out plenty of rewards.  Can’t complain there.

I’ve spent a couple of years experimenting with coupon options; I love the convenience of printing online coupons vs. having to get a printed newspaper (I subscribe digitally nowadays), but coupons that link to your store’s loyalty card offer an even more convenient option since you don’t even have to remember to bring the coupons to the store, something I’m guilty of often enough.  I’m planning on writing about SavingStar soon, which is the one I’ve had the most experience with, but others are attempting similar ideas.

Finally, there’s cash back sites, which, similar to MyPoints, attempt to entice you to shop through their links by offering you a reward.  However, unlike MyPoints, they offer actual cash back, which basically amounts to a cut of their affiliate revenue.  I have not done much investigation in this, other than the now-cancelled Bing Cashback program. I’ll look into this too, as there’s a number of sites out there, but that is part of what worries me.

The thing to remember about all of this is the effort is the ease of getting your rewards, what thresholds must be achieved, etc. should be balanced against your time.  MyPoints used to give you five points for just about every email you read, which amounted to a few hundred points a month, and for not much effort. Over time the number of emails which give you that reward has seemed to go down, diluting the value of the program. Surveys can take 15-20 minutes to get 50 points, not a whole lot of value when it’s more than 1000 points to get a $10 gift card.

Credit card point and cash back programs can be handy, but miss a payment or carry a balance and you could easily pay more than the value in fees. Chasing the best cash back may require you to go to a bunch of different sites for different purchases, and your time may be more valuable than that.  One well-timed purchase with the right offer could be a great win. As such, figure out what makes sense for you. For me, passive has definitely proven a winner, but when the right offer comes along, I’ll be a bit more active too.

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