Air Miles and Aeroplan points. The two biggest travel rewards programs. There is always the decision on which one to go with.
This will provide a bit of an analysis on them and which one I think is better. Personally, I think you should sign up for both, since the programs are free. There are credit cards that allow you to collect more miles and that is what I am going to focus on. For the record, I am going to assume points were obtained from a credit card alone and that the individual put $10,000 on their credit card in one year. I will also assume they are using their rewards for travel.
Basically, both programs are good. They are free to sign up and free to collect for most situations. Using the credit cards and paying fees change things though. Air Miles is the only one with a “no fee” credit card (Bank of Montreal’s Mosaik Mastercard and the American Express Air Miles card) and whether paying the fees is worth it to you or not, you need to read my other articles to figure that out.
The basic air miles Mosaik Mastcard is free, but the American Express is free as well and pays out more AirMiles so that is a no brainer if you want it. I figure you need to put at least $3600/year on the basic CIBC AeroClassic Visa card (the Aeroplan credit card) to make it worth your while there. For most people, that isn’t a problem.
- Collecting Air Miles and Their Value
- Collecting Aeroplan Points and Their Value
- Scotia Bank No Fee Money Back Visa Card Review
- TD Travel Visas
In my other articles, I value an Air Mile at 23 cents/mile for flights and I value an Aeroplan point at 1.6 cents/mile for flights. You can read them to see how I figure that out (links above). Using the $10,000/year situation, it would be in my best interest to pay the fee for the best credit cards. That would be the $120/year CIBC AeroGold Visa and the $80/year BMO Gold Mosaik Mastercard.
The Visa card would give me 15,000 aeroplan miles. These are valued at 15,000 times 1.6 cents or $240. Since I had to pay $120 for the yearly fee I would get $120 back from my spending.
The Mastercard would give me 666 Air Miles. These are valued at 666 times 23 cents or $153.18. Since I had to pay $80 for the yearly fee I would get $73.18 back from my spending.
I’m getting better value out of my Aeroplan Visa card? Yes, in this situation you are. I used the “travel rewards” scenario where an Air Mile is worth around 23 cents.
However, Air Miles has a variety of rewards and entertainment rewards are worth up to 45 cents/mile. You can only get these with an Air Miles card (this isn’t totally true, but there are so many more rewards with Air Miles you can’t really compare them). In that scenario the Air Miles card actually would give you $220 back from your spending (after deducting the $80 fee).
Here is a brief look at the pros and cons of these credit card programs and the reward systems in general.
Aeroplan Points Pros and Cons
Pros: This is a better “travel” rewards program.
- Collecting Aeroplan points with a credit card for the purpose of travel will give you better return on your credit card purchases.
- You can collect them at a variety of stores.
- Aeroplan has a good website for booking travel online
- More international destinations available.
- There isn’t a “no fee” credit card option.
- There aren’t as many rewards options.
- Aeroplan points have an expiry on them (its several years though).
- You can’t use them for WestJet flights (airline in Canada).
Air Miles Pros and Cons
Pros: This is better for rewards flexibility and better returns for the entertainment options.
- There is a “no fee” credit card option. If you don’t put a lot on credit cards, then this card is for you.
- There are a lot more rewards possibilities.
- Entertainment rewards make the return on credit card purchases worth more than the return on Aeroplan credit card purchases.
- You can collect them at a variety of stores.
- They don’t expire.
- They are good for travel with Air Canada and WestJet.
- Excellent automated phone system for booking non-travel rewards.
- If used strictly for travel rewards (flights), the return value from the credit card isn’t as good as Aeroplan.
- The Air Miles website is terrible and there is no ability to book flights online, only other rewards.
- Fewer international destinations than Aeroplan.
Update June 15, 2007: A reader commented that you can Collect Airmiles by just flying, which I said you could not. If you use your card in conjunction with booking you can receive more Airmiles.
My summary would be that you should sign up for both programs. You should always carry a blue Air Miles card and the orange Aeroplan card. Choosing a credit card depends on your rewards preferences and how much you expect to spend on your card. If you rarely use a card and don’t want the fee then just get the basic American Express Air Miles Card.
If you do spend more and will use the miles for traveling, then go with CIBC’s Aeroplan Visa cards. Read my article on Aeroplan to determine whether a credit card upgrade is worth it or not.
If you would like other types of rewards (like entertainment) or just more variety in your rewards, then go with Air Miles. Read my article on Air Miles to determine wheter a credit card upgarde is worth it or not.