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How to choose a travel rewards card

Posted by on Mar 17, 2013 in Money management, Saskatchewan Pension Plan | 0 comments

14 March 2013

By Sheryl Smolkin

SOURCE: SHUTTERSTOCK
SOURCE: SHUTTERSTOCK

I got my first travel rewards card in the mid-1990s when I was doing a distance LLM at University of Leicester and had to travel to Europe for series of residential weekends.

Without a great deal of thought, I opted for a CIBC Aerogold card because in addition to getting one point for every mile in the air, points were also awarded for amounts spent on household expenses with 1.5 per dollar credited for purchases at some grocery stores, drug stores and gas stations.

But it was often very hard to get Aeroplan seats on the flights we wanted to take. And it got even more difficult when Aeroplan instituted the current program, where the number of points required to reach a particular destination varies depending on the time of day, the day of the week or the time of the year.

When I started researching travel rewards cards again for this article, I realized that the current selection of over 70 cards is mind boggling and selecting a card that delivers the best value depends on whether you pay a fee, how much you spend each year and where you want to go.

In all cases, unless you pay off your credit card balance every month, the interest you pay on the outstanding balance will quickly erode the value of any travel benefits.

The most up-to-date resource I found was Rewards Canada. Here is their top 2012 pick in two categories with some of the key features of each card.

Top Travel Points Credit Card (with annual fee)

Capital One® Aspire Travel™ World MasterCard®*

The Capital One Aspire Travel World MasterCard has has been number 1 in this category for three years. Here are some of the reasons why:

  • Earn 2 reward miles for every $1 – on all purchases
  • Get 35,000 bonus reward miles with your first purchase
  • Get 10,000 anniversary bonus reward miles every year
  • Annual fee of $120. No additional fee to get a second card for “an authorized user.”
  • This card can be a good choice for someone who spends at least $2,000/month.

A requirement of this card is a minimum personal income of $60,000 or household income of $100,000.

Top Travel Points Credit Card (with no annual fee)

American Express Blue Sky Credit Card (2011: 1)

The Blue Sky Credit Card has been top in this category for four years. Here’s why:

  • Earn 2 points for every $1 in eligible card purchases at your chosen 5 places.
  • Earn 1 point for every $1 in card purchases everywhere else.
  • Earn a welcome bonus of 7,500 points the first time you use the approved card

I encourage you to follow the five step guide to choosing a travel rewards on the Rewards Canada website for a brief description of the types of travel rewards credit cards and what to look out for when choosing one.

There is an excellent chart updated to January 2013 comparing features of a series of the most popular Canadian travel cards. The Choosing a Travel Rewards Credit Card Flow Chart can also help you narrow down what category and type of card you should choose.

Have you selected a new travel rewards credit card lately? Have you had good or bad experiences with the card you are currently using? Send us an email socialmedia@saskpension.com. If your story is posted, your name will be entered in a quarterly draw for a gift card. And remember to put a dollar in the retirement savings jar every time you use one of our money-saving ideas.

If you would like to send us other money saving ideas, here are the themes for the next three weeks:

21-Mar Insurance Getting a better deal on car, house insurance
28-Mar Books Comparing eReaders
04-Apr Real estate New or resale house? Pros and cons

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