Stories of free flights, incredible deals, and “just used my points” are common these days. And for people who aren’t into loyalty programs, those who manage to travel so much on a low budget almost have this mystical aura about them. How do they do it? What do you mean she got a free flight and 4-star hotel for nothing?
Loyalty programs are designed to get you to come back to businesses, and they can be cumbersome and draining if you’re in too many or don’t choose the right ones, but if you know how to play the game, you can save yourself thousands of dollars on purchases you would have made anyway.
One of the keys to winning in loyalty programs is staying on top of the latest offers and loyalty programs. And while points and cash back programs have dominated the space for years, we’re going to show you how to both make the most of existing loyalty programs and show you what the future of loyalty programs looks like — that way you can stay on top of things.
Let’s go!
Common Types of Loyalty Programs
Since loyalty programs are any sort of program that rewards customers for purchases, consistency, engagement, referrals, etc. There are a lot of types.
Here are a few of the most popular:
Points programs like credit card or hotel points
Subscription programs like unlimited monthly coffee, Regal Unlimited, or Amazon Prime
Referral programs like The Hustle’s referral system
Tier-based programs like Chick-fil-A
Cashback programs like Capital One’s Quicksilver Cash Rewards Credit Card
Perks programs like Kroger’s gas discount
And many more!
There is an abundance of loyalty programs these days. So the trick isn’t finding them, it’s deciding which ones to use.
Why Should You Join Loyalty Programs?
When used correctly, loyalty programs save (or give) you more money than you would have had without them.
For example, if you spend $500 a month on groceries, have a credit card that gives you 2 points (worth a cent each) for every dollar spent, and pay off your credit card in full each month, you would get an automatic $10 back each month for doing exactly what you do anyway.
Or take credit card bonus fees. If you’ve been saving up for a new entertainment system that costs around $3,000, and instead of paying cash you signed up for a new credit card that had a “sign-up offer” that gives you $600 in points after spending $3,000 in the first two months, you could get $600 back on a purchase you were already going to make.
By optimizing your spending around the highest value programs whose points or rewards can be used on purchases you were already going to make anyway and strategically utilizing sign-up bonuses, you can save thousands of dollars over a few years, pay for flights, get free hotel rooms, and more.
It takes a bit of work to get set up and switch at the right times, but it’s still well worth the effort you put in.
The 6 Best Loyalty Programs You Should Consider Joining
Again, loyalty programs are designed to get you to spend more, but if you’re aware of that fact, you don’t have to.
By only joining programs that directly impact your existing spending, you can minimize the temptation to overspend / nullify the value of your rewards.
With that in mind, here are some of the best loyalty programs out there. We’ve included a diverse list — that way you could feasibly make a good decision by just going with all of these. These options are more useful when starting out than 5 different airline programs, for example.
Note: These are based off of NerdWallet’s 2021 Winners, personal experience, and other misc. research. The program details below were accurate at the time of the writing but may not remain the same.
Alaska Airlines Mileage Plan
Ideal for casual domestic flyers who like to take one other person on their trips.
While you won’t be able to fly anywhere, anytime, the rewards system of Alaska Airlines is fantastic. If you make $2,000 of purchases within 90 days, you get 40,000 bonus miles (around $440) and the Annual Companion Fare, which can drop a ticket for a friend down to $99 + fees. Add in rewards based on miles instead of cash and 3x miles for all Alaska Airlines bookings, and you can see why people love this loyalty program.
Reward Currency: Alaska Miles
Key Aspects:
Reward based on miles flown instead of cash spent, which rewards smarter booking choices
Can transfer points to Emirates and Cathay Pacific and other partners to 1,000+ destinations
$75 annual fee
3 miles for every $1 on Alaska Airlines flights, 1 mile for $1 for all other purchases
Free checked bags for up to 6 guests on the same reservation
No foreign transaction fees
Amazon Prime
Best for frequent online shoppers who want quick deliveries.
You may not think about Amazon Prime as a loyalty program, but that’s because it is so good at what it does that it escapes the label. Amazon does everything they can to make you lose money by not being a part of Prime (assuming you shop at Amazon regularly).
From Prime video, to free shipping, to lower prices in Amazon, using Amazon and not having Prime doesn’t make any sense, and that’s the point.
Reward Currency: None
Key Aspects:
Free two-day shipping on Prime eligible items
Prime discounts
Early access to deals
Prime video streaming
Pay monthly at $12.99 or yearly at $119
Chick-fil-A
Good for anyone who eats Chick-fil-A more than 2x a month.
Chick-fil-A, regardless of your opinion of fast food and their enterprise, is a brilliant business. They are superb at cleanliness, timeliness, consistency, and rewarding their customers.
Their loyalty program is legendary and has some really clever mechanisms to keep you coming back. So if you get down with Chick-fil-A at least more than 2x per month, then check it out.
Reward Currency: Points
Key Aspects:
Three Tiers: Member, Silver Member, Red Member
Points are rewarded for cash spent
Birthday rewards
Has giveaways for downloading the app and signing in consistently
Mobile ordering through app makes pick-up easier
Higher levels let you give away your gifts to others
The higher level you are, the more points you earn per $1
Higher levels have more say on the menu items Chick-fil-A releases
Capital One Venture Rewards Credit Card
A good “jack-of-all-trades” travel card for people who tend to fly on different airlines and use different hotels.
Capital One’s Venture Rewards Credit Card has been a big player in the credit card points game for a bit. The points are easy to earn and use, and you can transfer or spend your points on just about anything.
Reward Currency: Miles
Key Aspects:
60,000 mile bonus after spending $3,000 in the first month (~ $600 value)
2 miles per dollar spent on anything and everything
$95 annual fee
Best value when you redeem for travel
Permission
Good for anyone who wants to get paid for doing what they already do on the web.
Here’s the deal. Almost everything you do on the internet involves and leaves data, but since the dawn of the internet, YOU haven’t been paid for the use of your data. Meanwhile, huge internet companies have made massive fortunes off of your information.
Permission prescribes to a simple but radical idea: shouldn’t you get paid for your data?
And the best part? You don’t have to change any of your habits. You join Permission, and companies reward you with crypto in return for your time and attention. It’s that simple.
Reward Currency: ASK
Key Aspects:
A new type of loyalty program driven by crypto rewards
A browser extension that lets you earn crypto based on your existing searches and habits
Earn crypto for engaging with ads and content
Is expanding its reach to become the backbone of loyalty programs everywhere everywhere, making it easier and more flexible for earners to redeem across brands.
Regal Unlimited
Great for any movie buffs who see more than 2 movies a month.
This is Regal’s answer to the spectacular fall of MoviePass. For ~$20/month you can watch as many movies as you’d like and earn on concession purchases. Since movies cost between $12-15 these days, if you go to at least two movies a month, you’ll be saving money.
Reward Currency: Crown Club Credits
Key Aspects:
Different tiers open up more and more theaters, but the middle tier for $20/month is usually more than enough.
Earn credits on all purchases that can be redeemed for free tickets and food. Pay for your friends’ tickets to rack up points!
Unlimited movies per month, including new releases.
Fees can apply for booking less than an hour in advance.
How to be a Loyalty Program Pro
Here are some tricks of the trade from loyalty program pros.
Make sure the annual fees make sense for your spending.
If you aren’t going to earn more in points than the annual fee, don’t go for it. That would just mean more unnecessary bills. It’s easiest to get hit by unnecessary annual fees when you have a lot of cards, so make sure whichever ones you have you’re actually using!
Note many credit card companies will cancel or reduce your fee if you call them to cancel shortly after noticing an annual fee charge.
Ditch the cash.
The more you spend on your card, the more points you earn. Cash should become a last resort — it’s a pointless transaction!
Maximize your earnings by choosing which card to spend with on particular categories.
Some cards earn you more on food. Other more on flights. Know which cards are best spent where so you can maximize your earnings.
Choose loyalty programs that fit into your existing habits
The point of loyalty programs is to get you to spend more, but you can outwit them by only choosing cards that complement your existing spending habits. If you already fly multiple times a year, there’s no reason not to earn from them, but if you don’t already shop at Nordstrom, maybe you don’t need their card.
Get your credit score to above 720
Most loyalty programs and good credit cards with rewards require decent credit. If you aren’t above 720 yet, put the time and work in to get there before going down the loyalty program rabbit hole.
Do not go into debt over points
No points are worth suffering from the atrocious interest rates on credit cards. Whatever you do, do NOT carry a balance! This excludes particular people with good handles on leverage, but anytime you rack up interest you are cutting right back into your point profits and likely going in the red.
Take advantage of welcome bonuses
Welcome bonuses are critical to earning from rewards programs. Line up your big purchases with a new card to earn big.
Stack points
Use your best food-to-points credit card to plug into your Chick-fil-A rewards program. Use your favorite flight card for Regal Unlimited — find as many ways as you can to stack your favorite cards and programs.
Avoid opening a bunch of credit lines before big purchases
Credit card churning and loyalty programs can mean opening up more lines of credit, which can negatively affect your score. If you’re going to buy a house or car in the near future, you may want to hold off.
Respect the 5/24 rule
While not official, many credit card companies begin to be more cautious with users who open up more than 5 cards in two years (or 24 months), so it’s best practice to stay at or under this split.
Amazing Resources for Credit Card Churning
When you join multiple programs, things can get a bit confusing. Here are some tools and resources that will help you make the most of your programs.
NerdWallet — one of the best rewards blogs out there
AwardWallet — track all of your programs and points in one place
ThePointsGuy — amazing blog for travel point optimization
The Best Loyalty Program is a Universal Loyalty Program
The new era of loyalty programs has arrived
Imagine an internet where every single online transaction, across any brand, in any store, earns you a single type of reward currency that you can spend on more products, or trade for other global currencies (including dollars).
That is the future of loyalty programs. A world where the myriad of points, miles, cashback dollars, and rewards dissolves into a single reward currency that everyone is familiar with. One wallet, one currency, across an unlimited number of brands.
Brands will still be able to create their own unique incentives founded in this currency. And users can earn more whenever they want by engaging in specific actions encouraged by brands, like voluntarily engaging with ads or giving a company more information about themselves.
So if you’re a user who wants to get paid for your data, or a brand looking to add in the ASK cryptocurrency to your incentives, now is the time.