Credit Card Rewards: Our Beginner’s Guide

Many people are reluctant to take out another credit card (or many!). We’ve heard it all:

Since 2015, the entire Milesopedia team has been experimenting with credit cards, loyalty programs, cash back and educating you on the best do’s (and don’ts!) to help you better choose the one that earns you the most.

Here’s how to get started:

1- Define your goal: it’s easy and quite difficult at the same time. Which one should you choose?

Here are some ideas where points or cash back can be used:

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 such as 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 begin with, we believe that the best general combination regarding the best card to travel with 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 sign up for a credit card, the card issuer will consult your credit file. Two institutions provide this information: Equifax and Transunion.

It’s 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:

• Payment habits (35%)
• Credit utilization ratio (30%)
• 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 provided by the credit bureau and that given to the financial institution do not match;
• Recent move.

When choosing your next credit card, there are a few points to consider:

• Benefits (travel insurance, priority boarding, free baggage, access to airport lounges, no foreign currency conversion fees, etc.);
• The different ways of using points;
• Easy accumulation of points;
• Your next purchases, expenses or trips;
• Current credit card promotions;
• Your ability to obtain the welcome offer.

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

In Canada, the best known of all is Aeroplan, Air Canada’s rewards program.

Aeroplan Points can be used 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, that’s worth $2,000.

If 100,000 points save you $1,000, that’s below our estimate. It’s still good, but it could be better.

On the contrary, if those 100,000 points save you $2,000, $5,000 or even more, congratulations! You’ve really made the most of your Aeroplan points.

Get a head start and enroll for free in the Aeroplan program here.

Even if you don’t have Aeroplan points, don’t hesitate to do some research to find out how many Aeroplan points you’ll need for your future trip.

In Canada, the easiest and most accessible for all is the Marriott Bonvoy program, which gives access to over 9,000 hotels worldwide. It’s the only hotel chain in the country to offer a credit card linked to its program, allowing points to be accumulated 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.

Also, with each annual renewal of this card, you get a certificate for a free night at a Marriott hotel. This alone more than makes up for the annual fee.

To sign up for the Marriott Bonvoy program, get a head start by registering here, especially as registration is free.

Then, even if you don’t have Marriott Bonvoy points, don’t hesitate to do some research to find out how many Marriott Bonvoy points you would need for your future free hotel rooms.

Financial institutions offer their own reward programs.

We’ll talk about BONUSDOLLARS at Desjardins, BMO Rewards at BMO, or Membership Rewards at American Express.

Not all points are created equal!

They award points that can be used for:

• Booking accommodations, all-inclusives and other travel expenses like Airbnb;
• Account credit;
• Mortgage payments, investing in an RRSP or TFSA;
• Merchandise and gift cards ;
• Transfers to another rewards program (usually 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 have to wait until a certain date of the year or a certain amount earned to use it. Read the fine print!

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

• Use the right credit card in the right place and take advantage of gift cards at grocery stores or gas stations (a trick that involves using your credit card to buy gift cards where they accumulate faster).
• Buy via a loyalty program portals such as Aeroplan eStore (especially during Black Friday, long weekends with special promotions and other events that give you more points).
• Pay for your taxes (or any other supplier who only accepts cheques) 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 pleasure 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!

Once you’ve seen your points pile up in your account, it’s time to use them. Don’t hesitate to spend them as soon as you have enough for your trip. After all, 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 some other tutorials to give you ideas on how to use your points or miles:

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

During the first year of ownership of the American Express Cobalt^® Card, you can earn a potential minimum of 60,000 points, or $600 in account 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 those $750 in purchases at a store where you can earn 5 points / dollar (grocery stores, restaurants, bars, convenience stores – gift cards), you’ll earn 3,750 points ($750 x 5).

Make sure the shops you shop at accept American Express. There are more places than you might think, here are some examples:

• Shell, Esso, Petro-Canada, Ultramar, Irving, 7-Eleven;
• Jean Coutu, Uniprix, Shoppers Drug Mart, Familiprix, Rexall, London Drugs;
• Large majority of IGA’s, 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, The Bay, Home Depot, Canadian Tire, Dollarama, Yellow, DeSerres, Globo, Winners, SAQ, HM, Ardène, Amazon, Rona, etc;

The community often asks us to establish customized credit card rewards points strategies.

It is a delicate exercise because 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 (relaxation vs. retirement, salaried vs. self-employed, etc.)
• different means (students vs. high income, 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: