Point chasers fork out $1.7 billion to get access to points

Posted on Thursday, October 18, 2018 - 16:06

Being rewarded for simply spending can be a card holder’s dream and that is why Aussies invest in a reward credit card. However, Point chasers that go beyond their set budget with their card could find themselves in the red with little points saved for their efforts. The question is how far would Aussies go to gain reward points?

Point chasers forking out over $1 billion for points

There are plenty of reward cards that are available on the market that offer some tempting incentives. The catch is that you are required to spend a certain amount to accumulate points which can later be redeemed to save costs on a flight or can be redeemed for various items at a rewards store.

However, a growing trend of reward card holders shows that Aussies will spend on unnecessary items to gain points. A recent survey by finder revealed that point chasers wasted $1 billion in pursuit of points on items that didn’t give them points. This was the equivalent of $530 for an individual card holder.

Card holders who fail to check which items were going to give them access to more points by targeting their spending are likely to fall into the trap of overspending to access points. This can have negative effects on your card when it comes to meeting monthly repayments since this could increase the interest rate that is owed.

Men are more likely to overspend for points

The assumption might be that women are likely to overspend on points, but the data revealed that men were likely to overspend in order to gain more points. The average male forked out $767 a year compared to females who spent $307 per annum.

When it comes to understanding what they can get for their reward points 44% of Australians found themselves left in the dark. One of the things that cripple point chasers in their pursuit of points is not checking what is considered to be an eligible purchase with their reward program. This will differ from program to program which is why it is important that reward credit card holders check the fine print. This also means checking how you can build your points and knowing what they are worth before trading them for something that isn’t worth it.

More Aussies are paying attention to what reward card they choose

Aussies are cleaning up their act by becoming more careful when it comes to choosing a reward card that is suitable for their financial situation. According to a survey released by Citi Group, 88% of reward card holders prioritise the cards annual fee and compare their options before settling on a card.

Furthermore, 78% of Aussies were concerned by how the points were valued when it came to selecting a card.

To make the most of finding a reward card that matches your spending habits it is important to compare the fees that come with it, interest rates, and whether it matches the amount you are already spending. If you find yourself stepping out of your budget just to access points, then the card might not be suited for you.

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