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How are my rewards calculated?

Published on November 24th, 2020
  Written by 
Bill Tsouvalas
Bill Tsouvalas is the managing director and a key company spokesperson at Savvy. As a personal finance expert, he often shares his insights on a range of topics, being featured on leading news outlets including News Corp publications such as the Daily Telegraph and Herald Sun, Fairfax Media publications such as the Australian Financial Review, the Seven Network and more. Bill has over 15 years of experience working in the finance industry and founded Savvy in 2010 with a vision to provide affordable and accessible finance options to all Australians. He has built Savvy from a small asset finance brokerage into a financial comparison website which now attracts close to 2 million Aussies per year and was included in the BRW’s Fast 100 in 2015 as one of the fastest-growing companies in the country. He’s passionate about helping Australians make financially savvy decisions and reviews content across the brand to ensure its accuracy. You can follow Bill on LinkedIn.
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Calculating points for a reward program can be tricky since not all programs operate the same way. But if you are wondering whether you are getting your money’s worth on your reward credit card this guide will hopefully let you know what your points are worth and how much more do you need to build up to use for your next holiday trip or shopping spree.

Does your card offer the best value?

Whether you are on the market looking for a reward credit card that will offer you the best value, it is vital that you check that the card is suitable for you. If you know that you hardly travel, but spend most of your time using your card to swipe for deals in store then a frequent flyer card may not be suitable for you. Once you have decided what you would like to use the card for, it will be easier to compare your way to a card that offers you the best value for your buck.

Know how many points are needed

If you are planning to redeem your points for a gift card, a flight, or to spoil yourself with a bottle of wine from the reward store, checking the points that are needed to do this can save you the trouble of later on to see if you have enough points saved up.

Looking up the recommended retail price (RRP) of the reward can also be beneficial in knowing if you are close to your mark. You can do this by dividing the number of points required to redeem the award by the RRP of the reward. This will give you the answer to knowing the currency of the points needed to redeem $1.

For example:

If you earn 28,000 points in a year and the required points to redeem this is 150 points for $1 this means that your rewards equal to $186.66 in total.

How to build your rewards

If you want to build a solid bank of points that will give you value for your money, knowing how to target your spending will help you use your rewards credit card more effectively. If you know that you use your card for shopping you can target the way you spend to gain more rewards.

Checking your reward program details to see what items they have targeted can help you budget around these items that you buy to increase your rewards. Another effective way that you can build points is to use your card to use towards big purchases. Big purchase items could be in the form of using your card to pay for a family holiday trip or purchasing furniture.

Always keep in mind that if you find yourself spending more just to access points it is time to consider a new card that will be well suited for you. Comparing various cards can help you find one that has large sign-up bonuses but also offer you more value in terms of your points.

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This guide provides general information and does not consider your individual needs, finances or objectives. We do not make any recommendation or suggestion about which product is best for you based on your specific situation and we do not compare all companies in the market, or all products offered by all companies. It’s always important to consider whether professional financial, legal or taxation advice is appropriate for you before choosing or purchasing a financial product.

The content on our website is produced by experts in the field of finance and reviewed as part of our editorial guidelines. We endeavour to keep all information across our site updated with accurate information.

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