Credit Card Rewards: Our Beginner’s Guide

Many are hesitant to apply for another credit card (or several!). Here are the most common myths:

Since 2015, the entire Milesopedia team has been experimenting with credit cards, loyalty programs, and cash back, and informing you about the best things to do (and not to do!) to help you better choose the credit card that earns you the most.

Here’s how to get started:

1- Define your goal: it’s easy and yet so difficult at the same time. Which one to choose?

Here are several ideas for points or cash back:

2- Then, we recommend focusing on a maximum of one or two programs. The best ones to start with are:

• Aeroplan (for flight tickets);
• Marriott Bonvoy (for hotels);
• Flexible points like Scene+ points, Aventura points, TD Rewards points, American Express Membership Rewards points, or NBC Rewards points (which reimburse all types of travel expenses);
• Or simply cash back.

3- To start, we believe the best credit card combination for travel is:

Compare credit cards with our credit card comparator.

Visit our testimonials section: all those who have shared their successes with points started out with a very specific objective in mind!

When you apply for a credit card, the card issuer will check your credit file. Two institutions provide this information: Equifax and Transunion.

It is important to know that a credit card application will only count for 10% of your credit score.

80% of your credit score is based on:

• Your Payment Habits (35%)
• Your Credit Utilization Ratio (30%)
• Your Credit History (15%)

Have you been refused? Call your financial institution to find out more. It could be for the following reasons:

• Your credit file is locked;
• The information from the credit bureau and that provided to the financial institution do not match;
• Recent move.

To choose the credit card that matches your goals, a few points should be considered:

• Benefits (travel insurance, priority boarding, free baggage, airport lounge access, no foreign currency conversion fees, etc.);
• The different ways to use points;
• The ease of earning points;
• Your upcoming purchases, expenses, or travels;
• The current credit card welcome offer;
• Your ability to meet the conditions to obtain the welcome offer.

In summary, here are the cards to choose for each type of reward:

In Canada, the most well-known is Aeroplan, which is Air Canada’s loyalty program.

Aeroplan points can be redeemed for:

• Flight tickets with Air Canada or partners such as United, Emirates, Lufthansa, ANA, Singapore Airlines, SWISS, TAP Portugal, Turkish Airlines, Virgin Australia, etc.
• Hotel nights
• Car rentals
• Merchandise / Gift Cards

As a general rule, you’ll get the best return on your investment by using these points for airline tickets.

We estimate that one Aeroplan point is worth 2 cents. So, if you have 100,000 Aeroplan points, this has an estimated value of $2,000.

If 100,000 points save you $1,000, that’s below our estimate. That’s still good, but it’s always possible to do better.

On the contrary, if these 100,000 points save you $2,000, $5,000, or even more, congratulations! You have truly optimized your Aeroplan points.

Get ahead and sign up for the Aeroplan program for free here.

Even if you don’t have Aeroplan points, feel free to research how many Aeroplan points you need for an upcoming trip.

In Canada, the easiest and most accessible for everyone is the Marriott Bonvoy program, which provides access to over 9,000 hotels worldwide. It is the only hotel chain in the country that offers a credit card linked to their program, allowing you to earn points much faster.

These Marriott Bonvoy points entitle you to free nights at the hotel!

The best (and only with its “business” version) credit card for quickly earning hotel points is the Marriott Bonvoy^® American Express^® Card.

Additionally, with each annual renewal of this card, you receive a certificate for a free night at a Marriott hotel. This alone largely offsets the annual fees.

To enroll in the Marriott Bonvoy program, get ahead by signing up for free here.

Then, even if you don’t have Marriott Bonvoy points, feel free to research to get an idea of the number of Marriott Bonvoy points needed for future free hotel nights.

Financial institutions offer their own reward programs.

At Desjardins, we’ll talk about Bonidollars, at BMO, we’ll have BMO Rewards, or at American Express, you’ll find Membership Rewards.

Not all points are created equal!

They award points that can be used for:

• Purchase of accommodation, all-inclusive packages, and other travel expenses like Airbnb;
• Credit card statement credit;
• Pay the mortgage, invest in an RRSP or TFSA;
• Merchandise and gift cards;
• Transfers to another rewards program (generally airline or hotel).

Cash back Rewards Programs are mainly for those who don’t want to use the three previous types of programs.

Depending on the credit card, cash back is applied directly each month to pay off the card balance, or you must wait for a specific date in the year or a certain accumulated amount to use it. Read the fine print!

Every day, you can earn rewards through your purchases or credit card applications.

• Use the right credit card in the right place and take advantage of gift cards at grocery stores or the gas station (a trick that involves using your credit card to buy gift cards at places where points accumulate faster)
• Shop through a loyalty program portal like the Aeroplan eStore (especially during Black Friday, long weekends with special promotions, and other events that offer more points)
• Pay your taxes or any other vendor that only accepts checks with your credit card via Plastiq

A welcome offer from a credit card is the best way to earn points or cash back quickly.

Even if a card is used regularly, nothing beats the joy of receiving points more easily and quickly with an offer. Otherwise, you’ll need to be patient before you buy that coveted toaster or flight ticket.

Subscribe to our newsletter every Sunday morning at 7:00 a.m., to keep up to date with the latest juicy welcome offers.

This is the fun part!

After seeing your points accumulate in your account, it’s time to use them. Don’t hesitate to spend them as soon as you have enough for your trip. Indeed, points and programs are never immune to devaluation or changes in redemption options.

In short, as we often say, your points bank is not an RRSP to be used for your retirement!

Depending on your points or program type, check out our step-by-step tutorials below on how to redeem your points.

Here are other tutorials to give you ideas on how to use your points or miles:

It is easy to understand and offers very fast 5X points accumulation at grocery stores and restaurants. It’s the best way to start.

During the first year of holding the American Express Cobalt^MC Card, it is possible to earn a potential of at least 60,000 points, or $600 in statement credit for any purchase:

• Each month, the card gives you a bonus of 1,250 points once you’ve made $750 in purchases during the month.
• And if you make these $750 in purchases at a merchant allowing you to earn 5 points / dollar (grocery stores, restaurants, bars, convenience stores – read gift cards), you earn 3,750 points (750 $ x 5) through your purchases.

Ensure that the merchants you frequent accept American Express. It is more common than one might think, and here are some examples:

• Shell, Esso, Petro-Canada, Ultramar, Irving, 7-Eleven;
• Jean Coutu, Uniprix, Shoppers Drug Mart, Familiprix, Rexall, London Drugs;
• Most IGA, Metro, Adonis, Super C, Marché Richelieu, Couche-Tard, Circle K, Whole Foods, Walmart, TooGoodToGo, FoodHero, FlashFood;
• Best Buy, Staples, Apple, Dell, The Source;
• La Cage, Les 3 Brasseurs, Poulet Rouge, Yuzu Sushi, Cora, Mikes, Starbucks, Café Dépôt, McDonald’s, Five Guys, St-Hubert, Chez Ashton, etc.;
• Ikea, Hudson’s Bay, Home Depot, Canadian Tire, Dollarama, Yellow, DeSerres, Globo, Winners, SAQ, H&M, Ardène, Amazon, Rona, etc;

We are often asked by the community to establish personalized strategies with credit card reward points.

This is a delicate exercise, as everyone has:

• different desires (economy class vs. business, hotels vs. Airbnb, nature vs. urban, etc.)
• different lives (single vs. couple, couple vs. family, etc.)
• different flexibilities (time off vs retirement, salaried employees vs self-employed, etc.)
• different means (students vs high earners, etc.)
• different expenses (large grocery stores vs. market, daycare costs, etc.)

In short, one size does not fit all when it comes to credit card rewards strategies!

Mastering rewards and credit card programs require knowing the basic rules: