How to give loyalty points to charity
The UK is one of the world's most charitable nations. 79% of us give to good causes every month, according to Charities Aid Foundation (CAF) research.
Not only that but, despite squeezed budgets and a poor economic outlook, the number of regular donors actually increased by 1.1 million from 2010 to 2011.
To sustain those levels many of us are clearly getting as savvy with our giving as we are with our spending.
One way to do that is by converting loyalty points but who can you give to and is it worthwhile? We take a look in this guide.
How to give
All of the biggest loyalty schemes, and a few small ones, offer cardholders chance to convert their points to charitable giving.
Tesco's Clubcard scheme works with just three specific charities through the reward voucher system.
|Cancer Research UK||£2.50 in vouchers = £2.50 donated|
|RSPB Together for Trees||£2.50 in vouchers = £2.50 donated|
|The Woodland Trust||£11 in vouchers = 3 tree dedication|
As you can see, the Cancer Research and RSPB donations are pretty straightforward: points are converted to cash at the same rate as many other rewards and go straight to the charity.
The Woodland Trust donation is a gift style donation.
Again, the charity is getting at least £11 in cash. In return, donors get a personalised dedication card including a map showing where their new trees have been planted.
The reward scheme best known through Sainsbury's supermarkets, also allows cardholders to convert their points online into donations to two charities: Oxfam and Action for Children.
|Oxfam||500 points = £2.50 donated|
|Action for Children||500 points = £1 donated|
Nectar give to Oxfam through the charity's Unwrapped programme which donates in the form of gifts like a share on a farm, chickens or clean water for ten people.
Action for Children are given very specific support by Nectar through their Children in Our Community initiative which funds projects for disabled and disadvantaged children in the UK.
American Express Membership Rewards
Those who spend using an American Express credit card automatically build up Membership Reward points for every pound spent.
Again, these can be exchanged for donations to specific charities.
|Breast Cancer Campaign||from 500 points to donate|
|Great Ormond Street Hospital||from 500 points to donate|
|NSPCC||from 500 points to donate|
|Save the Children||from 500 points to donate|
|Global Fund||from 500 points to donate|
Red Spotted Hanky
As we said above, it isn't just the big loyalty schemes that support good causes.
If you've ever used travel discount site Red Spotted Hanky you'll have built up some points in their loyalty scheme and those points can be converted into a donation to the Railway Children charity.
Railway Children provides help for children living on the streets in the UK and abroad.
Are points a good way to give?
Millions of pounds worth of loyalty points go to waste every year, giving them to charity instead of letting them lay around is an easy win.
If you're thinking of using points as a way of regularly donating, however, we think it's worth considering whether this is the best way to give.
Under the Gift Aid scheme, charities can claim tax back from the Government when UK taxpayers donate.
When you Gift Aid a donation you're effectively increasing the amount of money you're giving by 25%.
As far as we can tell, however, most donated loyalty points don't have a Gift Aid option so, if you're giving often, this is well worth checking.
It may be worth using the points for other rewards such as money off shopping and then giving the same amount to your chosen cause when you can ensure that they'll get the benefit of Gift Aid.
Note that even big donation sites can deplete the amount you give.
With Gift Aid a £50 donation should get the charity £62.25. But big fund raising sites take an admin fee which can deplete that amount.
Even with one of the best, My Donate run by BT, that £62.25 will become £61.75.
How do donations compare to other rewards?
Most schemes allow people to donate their points at the same rate they would receive for normal rewards.
For example, spending £500 in Tesco provides a Clubcard holder with £5 in vouchers and the face value can be directly donated to a charity.
However, though the direct exchange of voucher value for purchase power is normal for most loyalty scheme buys, Clubcard holders can increase their worth with some Clubcard rewards, which convert £2.50 of vouchers into £10 of spend.
The options here are limited, however. Examples include evenings out in Pizza Express and visits to Warwick Castle.
A £500 spend in Sainsbury's earns a Nectar cardholder 1,000 points. This, in turn, is the equivalent to a £5 voucher or £5 in donations.
Shoppers who don't give to charity receive the same exchange rate of 500 points for a £2.50 voucher.
Again, like Tesco, there are some rewards that offer more cash for points but these are limited to things like theme park tickets.
American Express cardholders earn points for every pound they spend. The way the scheme is set up makes it difficult to make direct comparisons but, having a dig around, it seems as though cardholders may be giving less for their points than they might expect.
For example, 5,000 points will enable shoppers to buy a £25 Starbucks gift card.
The same amount of points will allow Breast Cancer Campaign to buy a protective laboratory coat which, according to their previous campaigns is equivalent to a donation of £17.
Red Spotted Hanky
Consumers using the Red Spotted Hanky site to buy tickets for travel earn one point for every pound spent.
Each point is worth one penny, which they can choose to donate to the Railway Children charity or as a reduction off their next booking.
Where will your donation go?
Finally, just as with any donation, exactly where the money goes depends on the individual charity and is worth checking up on.
For example, 75.6% of the money given to the Railway Children was classed as direct charitable spend in 2010.
Oxfam report that for every £1 given to them, 80p is spent directly on emergency, development and campaigning work, 11p is spent on support and governance and 9p is invested to generate future income.
Cancer Research says that 80% of the money they raise is directly spent on beating cancer.
To get an idea of how any registered charity spends its donations check the charity register here.
Other ways to give for less
As we said above, loyalty points are one way to give to charity without putting a hole in your wallet. But they're not the only way.
Here are a few more ways to give for less.
1. Give unwanted goods
Collect together all the unwanted objects lurking at the back of cupboards and wardrobes and give them to the nearest charity shop, homeless shelter or other good cause.
If old towels, blankets and other soft furnishings are too far gone to resell, contact animal welfare charities to see if they need extra animal bedding.
2. Shop at charity shops
Shopping at charity shops is also a great way of giving and saving money at the same time.
3. Give time
Time rich and cash poor? Give something back to the world by volunteering.
This could be anything from helping a charity shop cash up to working with a local youth group. Find places to volunteer here.
4. Give cash back
Most of the big name charities have charity credit cards issued on their behalf.
Unfortunately, as we've shown in more detail here, they offer a poor return on spending.
They typically give just 25p for every £100 of purchases.
A market leading cash back credit card will earn £2 on the same spend which can then be directly given to charity along with Gift Aid.
Even better, you can use some cash back cards and get loyalty points on the same spend.
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