Collecting Aeroplan Points and Their Value
Why I think an Aeroplan mile/point is worth 1.6 cents and if you should collect them with a credit card.
Aeroplan points, Air miles, HBC points, PetroPoints, etc, etc, all the way back to Club Z Points at Zellers. They seem like such a gimmick and just a way to influence your spending. The thing is, they are everywhere now and you can't really avoid it, so you might as well take advantage of it. I have calculated how much I think they are worth so read on.
I personally collect Air Miles and Aeroplan Points so I just talk about those. This posting is about Aeroplan Points specifically, but the same techniques can be used to figure out Air Miles. You can read these related articles...
- Collecting Air Miles and their Value
- Air Miles Versus Aeroplan Points
- Scotia Bank No Fee Money Back Visa Card Review
- TD Travel Visas
Note: I interchange the word points and miles throughout this article. They mean the same thing. An Aeroplan Point and an Aeroplan Mile are the same.
To calculate the value of an Aeroplan point I priced out a flight on their website using points and then priced out a similar flight the same day using Air Canada's website. From that, I determined an Aeroplan point is worth 1.6 cents/point. I will explain later how I came to this.
How to Collect Aeroplan Points
Aeroplan, first of all, is free and there are three different ways to collect.
- You can apply for an Aeroplan card and just keep it on you. If you shop at stores that are affiliated with them (Future Shop, Esso, etc) then you just hand them your card and you collect some points whenever you purchase something.
- You use it whenever you fly with Air Canada or some other Star Alliance member airline. You will receive a certain number of Aeroplan points whenever you fly somewhere. This is free as well.
- You apply for a CIBC Aeroplan VISA card. There is a fee for these cards. $29/year will give you the CIBC AeroClassic VISA card that will give you 1 point for every $2 you put on the card. $120/year will give you a CIBC AeroGold VISA card that will give you 1.5 points for every $1 you spend on it.
- Apply for an American Express Aeroplan credit card
- Apply for one of the many other credit cards that offer Aeroplan points as well
These points can later be used to buy flights, car rentals, hotels rooms, and a few other products. With flights and car rentals you will still have to pay the taxes, but the base fees are covered by the Aeroplan points.
So this is the basics of the system. Now I will discuss what they are actually worth.
What is Value of an Aeroplan Mile? (How I Figure Out How Much They Are Worth)
This is an interesting question. Basically, I went through the steps of booking a flight through Aeroplan and through the Air Canada website from Calgary to Victoria.
The cheapest price I could find for the flight was $321.54 including taxes (this was with the no baggage and other deduction options). With Aeroplan, it was 15,000 Aeroplan miles plus I had to pay $78.80 for taxes and other fees.
So I can assume my 15,000 Aeroplan miles were worth $242.74 (the difference in money out of my pocket). This means one Aeroplan mile is worth around 1.6 cents.
Note: Other products/rewards require more or less Aeroplan miles, which can make them worth more or less money than 1.6 cents/aeroplan point.
Basically, my advice is to check out how much money you "actually" save by using Aeroplan miles to purchase something and how many Aeroplan points it takes and plug it into this formula:
Aeroplan Miles Value = Money Saved / Aeroplan Miles Used
Should I Get a Aeroplan Visa Card or Upgrade My Existing One?
Should you pay the annual fee to get Aeroplan Miles? This depends on how much money you spend on your credit card and what you will use your miles for. The more you spend, the more likely an upgrade will be a good thing.
Now that we did our calculations above to see what an aeroplan point is worth we can figure this out. Ask yourself what you want to use it for. For me, it is flights.
I will show you whether you should upgrade for the flight example I did above. To calculate this I made a formula that took into account the annual fee and what the value of an aeroplan mile is to figure out how much money you would need to spend to at least recover the annual fee in aeroplan miles value. The formula for getting the $29 basic card is 58 / Aeroplan Miles Value. The formula for the $120 gold card is 80 / Aeroplan Miles Value. If you want to see how I figured these out, send me an email and I'll send you the proofs.
For example, if I value an Aeroplan mile at 1.6 cents, this is the formula:
58 / 0.016 = $3625
80 / 0.016 = $5000
This means that I would need to put $3625/year on my AeroClassic Visa card to make it worth the fee and $5000/year to upgrade to the AeroGold Visa card. Once you have spent those amounts, the extra aeroplan miles you have earned are valued at the same amount as the fee you have paid.
Note: If the value you get from an Aeroplan mile is greater than 1.6 cents/mile, the amount you need to spend goes down. Just plug the value into the formula and you will see. Hotels, car rentals, vacations, etc might be a better deal.
This isn't the whole story either. There are other perks to these cards that I have not talked about. The AeroGold has better options for flights and other advantages so you should actually read up on it yourself. Sometimes there will be a feature to the card that will outweight the value I am talking about here (lower interest rate, other discounts, insurance coverage, etc.)
Aeroplan Bonus Offers
CIBC Aerogold and AeroClassic Visas
Aeroplan Bookings With Air Canada - They Will Change Your Flights
Air Miles and Aeroplan Points to Montreal
Aeroplan Versus Air Miles - Comparing Them
Original Post: Saturday, January 20th, 2007
Peter Koning Says:
Thanks for this posting. It helped me decide if it was worth using points .vs. paying for a ticket.
e.g. To fly return Kelowna<>Vancouver with Aeroplan the points were 22500 ~ $360. But with Westjet I found a flight that was $180 all taxes included. So
I was wondering if you have made any comparisons between the CIBC Aerogold Visa and the RBC Avion Visa?
No, I haven't checked out other cards and I should. I was just in Starbucks and I see they have one of those 1% back cards where you get actual gift certificates back. They might be better too. I will try and do research on those cards as well.
james briggs Says:
lost cards what to do ?
robert solda Says:
i have the cibc aerogold and i believe that you earn 1 point per dollar spent. you can earn .5 additional points at esso stations. is that what you meant?
Michael Davie Says:
Thanks for the article. I just wanted to add a couple points.
- As someone alluded to above, you get 1 mile per dollar with most purchases with the CIBC Aerogold Visa, but 1.5 for gas stations, grocery stores and drug stores.
- Using your Aerogold Visa and Aeroplan card at Esso means you get 0.33 miles per dollar from Esso and 1.5 miles per dollar from CIBC for a total of 1.83 miles per dollar.
- You can also get Aeroplan miles directly from most hotel loyalty programs. These are (in my experience) always free and are another way to double dip on hotel stays.
I just today learned about the new Aeroplan Music Store, which on investigation offers 50 songs for 6000 points, or 120 points per song. Apple iTunes, etc. typically charge $.99 per song, so there's another money comparator: a dollar is about 120 points.
Tammy Woroschuk Says:
Thanks for the information. I have a Westjet Gold Mastercard (no more than 1400 airmiles to fly) and they have made some pretty significant changes now. I no longer get that option and can only get 20% off the airmiles needed to purchase a flight versus the next person without the gold mastercard. It is no longer worth the 90/year cost for that card. This website has me looking elsewhere for my points collection. Thanks
Marcelle Dumais Says:
How do I exchange Aeroplan for Esso
Howie P Says:
Please let me know if you\'ve done the AeroPlan vs. RBC Avion comparison. I\'d be very interested in reading your findings. Thanks
Very cool, thank you for the article.
I was too lazy to do that math on my Aeroplan gold card. I'm very happy that it works out well in my favour. I'm starting to collect some more points with other services too.
I'll have to see if they can link the Esso speed pass with the Aeroplan membership so that I automatically double dip on my fuel purchases and then convert the Esso points after.
For the exchaging point question, this is what the Aeroplan site directs you to. Esso is on there with a ton of other points plans.
I haven't checked into the the losses for exchanging this, but I know one guy that I used to work with used this alot.
Oops, that did take the URL.
Points dot com for exchanging points between different rewards programs!
One thing you might want to take into account is income tax. In your analysis, 15000 points was equivalent to $243. But to spend $243, you have to make more than that, because the government wants their cut. I'm not sure, but you don't have to claim points as income, right?
So if you are taxed at 30% for example, you'd have to make $347 to spend $243. So now it looks like the points are worth more like 2.3 cents per point.
So the more income you make, the better the points look. Does this make sense, or am I totally off?
I'm pretty sure if you have a cash back program you have to claim it as income.
F D Says:
I use the CIBC Aerogold VISA. For 80,000 points I got a ticket to Paris BUSINESS CLASS worth about $5800. That works out to 7 cents per point. Or a 7% refund. Much higher than your 1.6 cents per point. But of course you need the 80,000 points per person to cash in like this.
You do actually have to pay tax on airmiles and aeroplan points.
@ T. dot
I think you and Steve are talking about two different things.
Yes, you have to pay the taxes (GST, etc) on redemptions but the benefit you receive (using points to purchase service) is not by itself taxable.
Aeroplan and Airmiles points are considered income and ARE taxable (although the large majority of people do not claim them in their tax returns). If you are auditted by the government, you can be forced to pay tax on rewards points as they carry a monetary value and are considered income.
What if I get an aerogold card and a supplementary one for my wife, i.e., total fee $170.00? How much would I have to spend on it per year to make it worth it in aeroplan points?
Can you guys confirm if these points have an expiry date, a friend of mine was telling me that if you do not use the points you accumulate will expire at the end of the year.
The points do not expire at the end of every year, but you do have to use them within 7 years. It's probably best to look on the web site for all the details. Thanks for this info, very interesting!
The dollar value per point isn't necessarily accurate.
From my research I found out that for example a return flight from Calgary to Vancouver is 15,000 miles. Air Canada typically charges you more if you pick flights at certain times. For example, if I fly return take flights between 11 AM - 1 PM both ways my flight can be as expensive at $300 before tax. If I take 6am flights each time my flight would cost $200 before tax. However both times my flight would cost 15,000 Aeroplan points.
Perhaps there should be a strategy for redeeming points. For example, save your points for peak travel times and pay out of pocket for cheaper flights. Using WestJet seat sales instead of Air Canada in those cases you could potentially even save more.
Perhaps an idea for another article!
Regarding income taxes, I believe that the only time the points accumulated would attract income tax would be if they were gained through your employment; i.e. if you got points because you spent money for business purposes (hotels, gas, etc.), in which case it\\\'s a benefit derived through employment. However, if you are purchasing something for personal use, then it\\\'s simply akin to a discount received, or an incentive to shop, and hence not taxable.
There is a less subjective way to calculate their worth. Figure out how much money in gasoline gift cards you could get with your points since gasoline is a commodity that is widely used and rarely on sale.
With Airmiles, 175 Airmiles nets you a $20 Shell GC, or about 1.1 cents/Airmile.
With Aeroplan, you can use 12,500 Aeroplan points for a $100 Esso GC. This translates into 0.8 cents/point.
Many people would peg Aeroplan points best usage to be purchasing first class tickets. There are documented cases where people have travelled around the world in first class on just 120,000 Aeroplan points plus $200-$400 in surcharges/taxes. That could translate into at least 20x the benefit of using points to purchase gas GC's.
While most of the calculation showed here are correct, there is more to consider when you consider whether you need to upgrade your card.
Let us say that you earn 1.5 miles/dollar(not true, only in some category)spend by using your CIBC AEROGold Card. that is equal to 2.4c/dollar based on how you value the points.
Now let us say you get a Fee free cashback card from MBNA and you get 1.5c/dollar spend. So the incremental rewards you get by using the CIBC Gold Card is only 2.4c-1.5c = 0.9c.
In order to make your 120$ fee worthwhile, you need to spend at least 120$/0.009$= 13,333 on your CIBC card.
One thing to remember is that you are only getting the incremental benefits by using the fee product compared to the fee free card.
I second the point made by Sean above. Given that it's possible to get dividend cards with no fees or with lesser fees, even from CIBC, the cash value given up by choosing aeroplan points instead must be taken into consideration.
The fact that cards with higher fees may offer greater cash back dividends (albeit only when the annual purchases pass a certain threshold), and OTOH, that there are also benefit features (travel interruptions insurance, travel medical coverage, etc) that come with the premium cards, further complicate these evaluations.
But a relatively simple comparison is possible between the CIBC Infinite Dividend card and the Infinite Aerogold card. Where the difference in annual fees is only $39 ($61 if a second card is issued).
On the dividend card, the first $3000 of purchases are rebated at .5%, the next $12000 at 1%, the next $20,000 at 1.5%, for a total of $435, and the remainder (up to a maximum contributing total of $50,000) at 2%. So on $40,000 of purchases, the rebate is $535.
To this one would have to add the $39 or $61 in extra fees needed to accumulate aeroplan points on the Aerogold Infinite card, and calculate the number of points the same purchases would generate and their real market value.
The vague definition of "grocery stores" generating 1.5points/dollar is the biggest obstacle to a clear comparison. And all the possible bonus points from select vendors further complicate matters. But it's probably close to the mark to expect $10,000 of annual purchases to be of groceries, generating 15,000 points, for a combined point total (conservatively) of 45,000 points vs. $600 of dividends.
Of course, as annual card purchases rise above the $50,000 dividend limit, the balance changes in favour of the Aeroplan card.
janet terry Says:
do a person leaving nigeria to united state need goverment visa pocket...and is it worth $5000
Lisa M. Says:
Thanks for posting this info; it's exactly what I needed to know!
Maria B Says:
With my husband will soon have enough aeroplan points to go around the world, I believe we need 180,000. We have to use before 2013. We plan to go around the world starting December 2011. Any idea how should we plan, want to include India and New Zealand.
Jimmy S Says:
To Maria B, you only need 150,000 Aeroplan miles to travel around the world (75,000 each person). When you book it select Multi-city and it allows you two destinations in the world for 75,000 miles but I've discovered some restrictions.
For example you can book Toronto to Bangkok, Bangkok to Mumbai and Mumbai to Toronto (and only costs 75000 miles as I just tried it). However if you try Mumbai to Melbourne and Melbourne to Toronto it doesn't work. I believe the 3rd leg exceeds a preset maximum distance or cost, however I may be wrong so call the aeroplan number to try booking it.
If I am correct then you could try an open jaw ticket where one leg is your responsibity to get there. For example book toronto-bangkok, bangkok-auckland and mumbai-toronto. Then you would use a low cost asia airline to get from aukland to mumbai.
Other interesting world combinations include Toronto-Bangkok-Cairo or in other words Toronto-Asia-Europe.
For you folks using your air miles for gifts or short haul flights, it's not worth it. Use it for around the world trips that would normally cost you ~$5000 (that's a 7% return).
Max w Says:
Yes it is a widely known fact that it is a waste of ones money to spend aeroplan points on short haul or even flights within north america
Just last spring i decided to vacation in thailand
I booked a roundtrip flight to bangkok from vancouver in Air Canada Executive First class
the flight cost me 100,000 points per seat,
but the cash equivalent for these seats would have been 5500
thats value of over 50 cents per point
much better deal
Neil Galloway Says:
That is pretty good value....but that is a really expensive flight too. I have not looked into executive class value. Perhaps that is a better way to get money back out of your points. When I fly overseas, I go as cheap as I can go and that flight would have been more in the $1,200 range for me.
Mr. Iceberb Says:
I would also be very interested in a review of Aeroplan vs Avion if you have the interest.
Kevin Misch Says:
First off, I have done my calculating and I happen to think the value of one Aeroplan mile is in fact 0.012 per mile or 1.2 cents per mile. But that is my opinion on the calculation of the value of an Aeroplan mile.
Plus a Huge wake up call!!!! If you are a Canadian Resident, and you use your Aeroplan to pay for US purchases you are losing 75% of what you original thought you gained with Aeroplan miles.
Why you ask? Lets say the exchange rate today is 1.05%. So you need $100.00 American and go buy your money at a bank or currency house. It will cost you $105.00 Canadian for $100.00 usd.
What you may over look is that if you chose spend the same $100.00 usd on your Visa for US purchases instead of using cash that you bought at $105.00 cdn. Visa/Mastercard will add a surcharge of 0.015% to the daily going exchange rate. Did you know that? Visa needs to make thier greedy profit of every angle.
So if the bank is at 1.05% than Visa will charge you 1.065%.
So that lets take a long haul flight to the US. Long haul flights are 25,000 Aeroplan miles.
We know it took $25,000.00 to gain 25,000 Aeroplan miles on your card. Unless you use your card at Gas Stations, Drug Stores or Grocery Stores where you get 1.5 miles for every dollar spent.
Every other place you use your visa is only 1 mile for every dollar spent.
So take $25,000.00 to get 25,000 miles for simplicity. To buy $25,000.00 usd at your bank you would spend $26,250.00 cdn. assuming the exchange rate today was 1.05%.
So it would cost you a total of $1250.00 for the 5% exchange rate or a total of $26,250.00 cdn to buy $25,000.00 usd.
Now lets say you spend $25,000.00 on US purchases on your Visa. Visa would charge you 1.5% over the bank currency exchange so 1.065% and that equals $26,625.00 cdn.that Visa will exchange this at.
So you spend $375.00 more using your Visa than if you paid cash for your US purchases.
Now we know a flight from Ontario to Florida is 25,000 miles in Economy. So how much would a ticket cost from Westjet or even Air Canada from Toronto to Florida?
Not much more than $375.00 right?
So in essence, using your Visa for US purchases means the free miles you think you earned actually is only 25% free after all.
You in reality just paid for three quarters of your US long haul flight ticket thanks to Visa's extra fees for us purchase transactions. It's in the fine print of your Visa Contract. Visa makes 1.5% over the regular daily exchange rate that any bank would charge where you buy your US money.
TIP!!!! Using Air Miles for Flights is far far better value than redeeming them on merchandise and Gift Cards. Example - A $100.00 Future Shop gift card = 13,000 Aeroplan points/miles. So based on my calculation of 1.2 cents per mile, 13,000 miles x 1.2 = $156.00 worth of miles for a $100.00 Gift Card.
So take a $3000.00 Plasma TV. You would need 30 $100.00 gift cards. 30 cards x 13,000 aeroplan miles = 390,000 aeroplan miles. So 390,000 x 1.2 cents = $4680.00. You just spent an extra $1680.00 for that Plasma TV using miles.
Now take a flight to Australia from Toronto. Cost is 75,000 miles. So 75,000 x 1.2 cents = $900.00.
The average cost to fly to Australia is $1200.00 plus taxes. So using Aeroplan miles for flights is by far a better use of your miles.
Unless you are under the gun to use them or lose them when approaching the 7 year expiry, than it is better to spend on whatever to use them up or lose them.
For those who shop at Safeway in BC, there is a promo (advertised about once/month or more) where you can get 100 or 250 airmiles for spending $100 or $200 in groceries...that's a $1 for 1 mile...I understand Safeway has higher prices, but generally the stores are less crowded than some competition...it might only result in a savings if you place value on shopping in less crazy-busy environments.
Problem is, Aeroplan rarely has the dates available that you want unless you book months in advance, and they always charge more miles than they say they will. I\'ve been with the program since inception, and it used to offer excellent value, flight availability was decent and they charged exactly the number of miles they claimed. However, now that the program is inundated with subscribers, they have made it much more difficult. Flight availability is greatly restricted, and they always find some way or another to charge you more points. For example, I recently inquired about booking a flight to San Francisco, which should be 15,000 miles round trip in North America. However, they didn\'t have dates even close to what I wanted even though I\'m booking over a month in advance, and the deduction of air miles to my account was going to be between 60,000 and 70,000 air miles for economy, depending on what flight option I chose---more than quadruple their advertised rate.
They also introduced expiry dates to your points, so they will now start to disappear off your account if you don\'t use them for a specified length of time, and you will lose ALL your points if you don\'t accumulate or spend any points for a period of one year.
Lately, the program sucks. Staff are rude and belligerent (which applies to most Air Canada staff, not just Aeroplan) and it\'s becoming increasingly difficult, inconvenient and expensive to use your points, and much easier to lose them.
And then there\'s CIBC\'s credit cards--complete rip-off, and you are supposed to get \'premium\' service, but it sucks. I was a customer of theirs for over five years, never a late payment or problem from my end. But as soon as you have a problem with them, all hell breaks loose.
When I was overseas one year, they rejected a payment of mine by cheque without explanation or notification, so I had to have the bank deposited to my account and the funds transferred, which took several days and as the result, my payment was three days past due. Based on one missed payment, my only missed payment ever, from any account at any bank, my credit rating went from R1 to R9---and it was TD that eventually did the research and found this out for me why my credit rating had dropped. It took over a year of yelling and arguing with CIBC before they admitted their mistake and formally apologized, and refunded my penalties, but they said they were unwilling/unable to amend my credit rating. I told them to eff themselves and closed all my accounts. I\'m sticking with TD.
Paul G Says:
Tip: If you can't get the flight you want with the Aeroplan Web site, I have found that you can get better flights calling the Aeroplan rewards centre. They can do legs and combinations not searched by the flight calculator.
I\'ve been with Aeroplan for a couple of yours I accumulate 4300 points every eight weeks. I have 34,077 points at this time. Adam\'s email says that Aeroplan is now deducting points if not used.I\'m a senior and this is all new to me.I also have a blue airmiles card,can they be combined. I would use the points to travel.Can I buy tickets for my husband and I together or does he need a card as well. I\\\\\\\'m sorry to ask so many questions.
Edward Burrill Says:
I want to give my " New E-Mail Add " & have a problem
finding a way to do so , can you help me ?
The old add. was Auracom.com
Thank you E.B.
I have accumulated just over 80,000 Aeroplan miles with Air Canada flights and wonder if that would be enough for me to purchase 2 return tickets UK to Canada?
A lot of people are asking if it is worth it to get a card that costs 120 a year. Remember that you will get with CIBC a bonus of 15000 just to sign up. And that is worth about 1.5 times the annual fee. and then you can decide near the end of the year whether its worth keeping ( I charge everything and I buy lots of goodies). Anyways check out the cibc aerogold... its great. I also get bonus points for my member card at thriftys.
There are some ridiculous things you can notice at Aeroplan. With my shopping habits I don't collect often and a lot of Aeroplan miles. Since redeeming on flights is the best worth of the points you collected - I was hoping to collect enough through years and got out of luck. Note: if you don't have a transaction for 12 months - your points will expire in addition to the fact that you have to use them up in 7 years before they expire. To have your points reinstated back to you you will pay $30 fee plus $0.01 for every point. Ok, I have no chance to collect for a flight, how about some gift card? $50 dollar gift card is about 7000 points. If I want to reinstate 7000 points back to me I'll have to pay $30 fee plus $0.01 per point ($70 for 7000 points) with a total of $100 for a $50 gift card. NICE!!!!
What if you want to transfer some of your points to your spouse or a friend to give them a gift? Transfer is at $0.02 per point. So for your friend to receive a 7000 points which he can redeem for a $50 gift card you will have to pay $140. ISN'T IT GREAT???
So if you are not a big user of Aeroplan, is it worth collecting?
I love the Aerogold CIBC Visa---sooooo tripppy!
Montgomery Triangle is Awesome!
Jon S Says:
When redeeming points, why aren't additional fees/surcharges (not pure taxes like PST/GST/HST) included?
For example, on a short-haul return flight, fees/surcharges can exceed the value redeemed (flight $150, real taxes $30, fees/surcharges $120).
btw, what happened prior to all these airport/gov fees/surcharges (pre 2000) - could one actually redeem 85% of the total flight cost?
Jon S Says:
I should clarify, above example:
"For example, on a short-haul return flight, fees/surcharges can exceed the value redeemed (flight $150, real taxes $30, fees/surcharges $120)."
Was for Toronto/Montreal (okay Aeroplan is useless for this short-haul flight) - should at least redeem for Toronto/NewYork.
Nevertheless, comment below still applies:
"btw, what happened prior to all these airport/gov fees/surcharges (pre 2000) - could one actually redeem 85% of the total flight cost?"
What is the actual reward mileage needed for a 'round the world ticket' with Aeroplan in 2011? I couldn't find that on the Aeroplan site, thanks to anybody who knows.
My husband and I flew Toronto> Japan> Singapore> Australia> Toronto for 75,000 miles. As long as you don't go back the way you came (double back) you can use your miles to visit more than one country (like Jimmy S. says). I called a travel agent and asked them to book the same route for me and she quoted $6,000 for a ticket like that. Also, not so much on the topic of the value of miles but someone wrote about redeeming the rewards - sometimes you need to talk to the right aeroplan operator because when we talked to one operator about the above route she said it wasn't possible to fly into a certain Japanese city and then we called back and got a guy who said that it was no problem! And we did book 5 months in advance!
I have never had any issue with flight dates being unavailable.
I have found that economy flights are unavailable when booking late and I have found that I have had to take a connection when booking late but I have always been able to find a route.
I called Aeroplan on July 11, 2011 for a trip from Toronto to Heathrow on July 16 and all there was available was business class on Lufthansa with a connection in Stuttgart. Longer flight time sure but for the extra points the business class was simply incredibly better than AC cattle class. I'm not going to fly cattle class again on points and I'm always going to request a Star Alliance partner flight rather than AC.
AC is always the default choice but I have always found Canadians forget that Alliance partner flights qualify and rarely if ever fill up as fast as AC
I am an engineer and several years ago I spent way too much time comparing all of the different credit card reward programs and decided that pretty much all of them offer the same reward when you figure out the cash value. It is not easy to figure out what a reward point it worth, you have to make some assumptions as to how much and how often and what type of purchases, but for an "average" buying consumer, Canadian credit card reward programs all pretty much boil down to a 1% reward for dollar charged. So once you realize that there is only a small financial difference between all the programs, it only makes sense to use the one that is easiest, which is hands down CIBC Dividend, no annual fee, no reward caps, free second and third cards, 1% cash back on everything, automatically paid out in December. The Dividend Platinum card doubles the reward for an annual fee, but check the fine print, rewards are capped at an annual limit which makes the platinum much less attractive. No restrictions, no blackouts, no hassles, no stupid gift cards or certificates, no catalogs of useless merchandise, no time on the phone, no nothing, just a big fat credit in December. The only thing missing, which for some people will be a problem, is the warm fuzzy feeling you might get by knowing your vacation is "free".
I think 1.6 cents/aeroplan mile do not hold anymore and it is half that value, or am I doing something wrong. I was astonished to find out that the cheapest ticket from Winnipeg to London (ON) on 10th November 2011 is $464 which takes out 58000 miles if one redeems it. That makes it about 0.8 cents/aeroplan mile, which is half the value. Is Aeroplan miles loosing it value at such a drastic rate?
@lgaetz...I wonder if your engineering background allowed you to calculate the fact that you need to spend 50k just to receive $500. Who spends 50 large anually...its not like you can charge your mortgage payments to your card.
Neil Galloway Says:
@lgaetz - I understand where you are coming from but I still disagree. 1% is a good rough estimate if you are talking travel rewards. But a lot of other entertainment or options can be cheaper and sometimes you can get a lot better back on travel. For example, I just traveled this past weekend and saved $400 using 750 miles to go from Calgary to Victoria. This is close to 50 cents/mile and I earn a mile for every $15 spent. So that is over 3% return. Superior to the cash back cards.
@David - Not necessarily...I find my value has gone up.
I should probably punch in longer flights as an example in my article. I often do comparisons for short hauls in Canada which only take 15,000 points and are often fairly expensive relatively, so the per point value is driven up. They definitely give the best bang for the buck....same for airmiles. But when you do longer flights...they go way down in value. For example...a flight from Calgary to Halifax is often more expensive than Calgary to somewhere in Europe....but it takes more points to go to Europe...go figure. So you get better value the closer to home you fly.
You always just do the math and then make a decision...for your Winnipeg/London flight...I would just pay out of pocket rather than using points...but if you aren't going to use your points for anything else...then you take what you can get. They are free anyways.
tadalafil generic vs cialis Says:
This is a topic that is near to my heart...
Cheers! Exactly where are your contact details though?
Voted the best gold and diamond buyer and seller in the faye Says:
At this moment I am going away to do my breakfast, when having
my breakfast coming yet again to read additional news.