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How to make the most of your loyalty cards

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By Martin Lewis, Britain's money saving expert, 26/07/2009

LOYALTY is a precious virtue . . . except in the case of loyalty CARDS, that is.

Because when it comes to this kind of plastic, it PAYS to do a bit of two-timing.

Right now its possible to make £12 PROFIT simply by buying a bottle of perfume or aftershave from Tesco.

And the trick is to disloyally manipulate loyalty cards - like those from from Tesco, Nectar, Airmiles, Boots and others - to boost your points' value by up to FOUR TIMES and even earn yourself money.

Retailers use these cards to keep us in their store so we don't take advantage of competitive markets.

Points doled out for spending in specific shops can create a vicious circle of loyalty. To use the points you'll need to go back. Then you'll likely spend more on top, earning more points, meaning you need to redeem again and again.

Yet if you know what you're doing, you can hit back.

Points are just a type of discount. Don't think the shop is giving you something for nothing. These schemes are incorporated into pricing policies.

For instance our fictional shopper Donna Finkalot believes Boots Advantage scheme's the best as it gives FOUR 1p points per £1 spent. She buys her favourite mascara for £10, fluttering with glee at the 40 points.

Ivor Secret loves the mascara too and, when his wife's away, sneakily buys it. His local supermarket sells it for £8.99. Knowing loyalty points are just a form of discount, he treats the real Boots cost as £9.60 and buys it in the supermarket.

So the golden rule is to shop where there is good value AND a loyalty card. That way you can win twice and earn off purchases. Here's how:

VALUE YOUR POINTS STASH

Is it better to earn Airmiles or Nectar points? Some schemes mystify their worth so you feel you're getting more than you are. Here's my calculation of each point's worth.

Nectar 0.5p

BA Mile 0.68p

Tesco 1p (in-store)

Boots 1p (in-store)

Airmile 8.5p

For these and other schemes, if you've a stash of points use free valuation tool www.loyaltychecker.co.uk .

Now let's look at how to make the most of the big loyalty cards:

TESCO

GET PAID TO SHOP AT TESCO: Here's the biggie - loopholes on Tesco promotions let you make money as bonus points are worth more than the product. Until Tuesday if you buy an £8 bottle of Lanvin Oxygen 30Ml fragrance you get 500 BONUS POINTS on your Clubcardwhich is convertible into £20 of rewards vouchers or £10 of double- up vouchers for wine etc.

So provided you use the vouchers that's £12 PROFIT PER BOTTLE - worth doing even if you don't want the frangrance (save it to give away at Christmas)

Once, when you could profit in a similar way from buying Tesco's Beef-in-Gravy, one chap bought £100s worth to donate to a homeless shelter, and then used the points for a trip to New Zealand worth £1,000s!

Whenever these loopholes come up, they go in my free weekly money tips email (get it at www.moneysavingexpert.com/tips )..

QUADRUPLE YOUR POINTS VALUE: While a 500-point voucher is worth a fiver in Tesco, trade it for up to four times that in Tesco Clubcard Rewards brochure items (www.tesco.com/clubcarddeals ). Offers include days out, magazine subscriptions, and RAC membership.

DOUBLE POINTS VALUE IN-STORE: At customer services trade normal Clubcard vouchers for Double-Up Vouchers for specific goods including wine, cosmetics, flowers and Tesco Mobile top-ups.

BOOTS

Boots gives four penny points per pound of instore spending. Here's how to boost Advantage Points:

USE IN-STORE ATMs. Look for Extra-offers kiosks that resemble Boots cash machines, pop your Advantage card in then print out instant extra discount vouchers.

GET MEGA-POINTS WEEKENDS. Periodically it has weekend promos of "spend £50 get 1,000 extra points" (£10). This is excellent for pay-as-you-go mobile top-ups as they're rarely discounted, so Boots points are next best.

JOIN BOOTS CLUBS: They have online parenting, over-60s and other clubs. Join for extra points vouchers.

SAINSBURY'S

Every £1 spent in Sainsbury, BP, Homebase and elsewhere earns two points on your Nectar card.

PICK REDEMPTIONS CAREFULLY: The average value of a Nectar point is 0.5p, so aim to redeem on things giving better value. For example, Vue cinema tickets are 1,000 Nectar points (1,300 in London), so if your local cinema's ticket price is HIGHER than £5 (£7 in the capital) it's good value for your points.

USE NECTAR AMEX CREDIT CARD: This is one of the better loyalty-linked credit cards. For every pound paid on it in Nectar Stores (eg. Sainsbury) you earn TWO EXTRA points on top of two for using the normal loyalty card. It also pays one point per £1 elsewhere, gives double points for the first three months, and if you spend over £500 a month there's a 500-point bonus. But ONLY do this if you ALWAYS repay in full to avoid interest.

AIRMILES

USE TESCO POINTS: Use Tesco's Clubcard Rewards brochure (see above) to swap 250 Clubcard points (worth £2.50 in-store) for 60 Airmiles (£5.10).

GET FREE BA EUROPEAN RETURNS: Open LloydsTSB Airmiles Duo card via Airmiles website, spend a tenner on it, and you get a 1,500 Airmiles voucher - enough for a BA Europe return including taxes. Though you need to book one night in an Airmiles hotel. Full info at www.moneysavingexpert.com/ccfreebies

SEND questions for publication to notw@moneysavingexpert.com

GMTV money guru Martin Lewis is the creator of the Consumer Revenge website www.MoneySavingExpert.com which is packed with info on how to get more money in your pocket.