Testimonial: my points strategy for a European tour package

The project: Scotland and Ireland group travel package for summer 2024

For the summer of 2024, my wife and I are planning a two-week guided tour of Scotland and Ireland. This will be a first for us. Normally, we’re the type to plan everything ourselves, but driving on the left side of the road for a long time is not something we wanted to get into.

The package we have chosen costs $6,300 per person and includes: flights, accommodation, travel, access to attractions, parks and museums, and most meals.

18 months earlier, I quickly realized that this type of trip would require a special strategy to keep costs as low as possible.

What's special about this type of trip

Many factors have a significant influence on our strategy.

• This is a one-time cost (flight and land portion) payable to the travel agency that organizes it, so you can’t use the reward programs travel portals to book anything. The value of the reward points applied in this case is often lower.
• This is a non-refundable expense requiring a deposit of 50% at the time of booking and 50% two months before departure. This is an unusual constraint for me, who has always planned my trips myself. If something happened, we could usually cancel or postpone a car rental, hotel, Airbnb or plane rental without too much loss. Neglecting this aspect could be very costly here.
• It is possible to purchase the land portion of the package and book the flight yourself… but in this case, the agency only offers a $500 discount on the package.
• It’s an overseas trip, so with foreign currency, and we’ll almost certainly be buying a few gifts and souvenirs on the spot (say a value of around $1,000 for two).
• Of course, there are still the costs of reserving seats on the flights, baggage fees, and sustentation andaccess to airport lounges, for these 9.30-hour flights. All these costs add up to several hundred dollars.
• For flights, it’s always possible to arrive earlier or leave later to get a better price; however, this is risky for an organized tour and may require extra nights. In other words, shopping around for flight prices and routes isn’t really an option here.
• Our credit cards that served us well in 2023 and before: a Marriott Bonvoy^® American Express^®* Card and a TD^® Aeroplan^® Visa Infinite Privilege* Credit Card with lots of Aeroplan points earned.

Time period to consider : 18 months of preparation and two calendar years, giving us plenty of opportunity to earn and redeem points or unlock welcome bonuses. As we often say, earning points is a marathon, not a sprint.

Possible strategies – The flight portion of the package

1. Book your own flights and pay only for the land portion of the package

Before considering a points redemption, sometimes paying for your flight in cash is a viable solution. Is this the case here?

This round-trip flight, on Air Canada, costs around $1,300 in economy class (based on a simulation below for 2023). But you only get a $500 discount per person on the travel agency package by choosing this option.

So if you booked the flights yourself, you’d save $1,000 for two people, only to pay $2,600, an extra $1,600.

Another important point: a basic economy class flight paid for in cash is non-refundable in the event of cancellation. This option is therefore ruled out.

2. Book your own flights with Reward Points and pay only for the ground portion of the package

As it happens, with our travel plans for 2023 and earlier, we had quite a few Aeroplan points in the bank, and the flights for the package in question are on Air Canada.

With an Aeroplan co-branded credit card (which gives a preferential rate in points) we had carried out simulations in points for the summer of 2023 with the outward and return trips separated (thus without the multidestination option), a way of doing things that can be advantageous with Aeroplan points. This gave us in points :

From a strictly accounting point of view, saving on the flight with Aeroplan points for an economy class flight appears to be an unwise use of points; sincea good use of Aeroplan points is valued at 2 cents per point.

Note that the deal is better for someone traveling in Premium Economy or business class, because of the gains on paid seats, paid baggage and included food (and lounge access if you’re in business class).

But since my wife and I don’t travel much, saving all those points for a possible trip in 2025 without knowing which carrier we’ll be using for points whose value can change quickly, wasn’t ideal. In our very special case, using our Aeroplan points makes sense. In the event of cancellation, there is also the possibility of recovering part of the costs.

For people who plan to travel several times a year with Air Canada, the answer would be quite different.

Result: $1,000 saved on this package.

Possible strategies – The land portion of the package

1. Establish a reference threshold with the maps we already have

I myself am guilty of keeping my credit cards for a long time, sometimes too long. I hate changing credit cards, and to convince myself to do so, I’ve gotten into the habit of validating what a concrete travel project looks like with my current cards by establishing a starting point.

The question I ask myself is: before we start looking for new credit cards, what can we get with the ones we already have?

Marriott Bonvoy^® American Express^®* Card: It helped us in 2023, but will be of no use here, since the package already includes all accommodations.

TD^® Aeroplan^® Visa Infinite Privilege* Credit Card: If we charge all expenses to this card and keep it until we travel, a small simulation would give us the following characteristics.

• No annual fee for this card (agreement negotiated with the bank based on my personal situation)
• 2.5% foreign exchange fee ($25 fee on $1,000 spent during the trip)
• No baggage fees ($300 savings for international flights, or $75 per person per direction)
• Access to Air Canada’s Maple Leaf Lounge at Montréal-Trudeau airport ($100 value)
• Access to DragonPass lounges in Dublin ($100 saved)
• Accumulation of 18,900 Aeroplan points (1.5x on travel agency-type spending), valued at approximately $378 in points (2 cents per point).
• The following insurance coverages:
• • Medical (for $5,000,000 and 31 days if under age 65)
  • Trip cancellation and interruption insurance (limit of $2,500 per person for cancellation, $5,000 for interruption)
  • • Trip cancellation protection is a little low for this type of travel, but the only card that offers more is the American Express Platinum Card^® ($3,000).
    • Note that you can increase this protection by contacting your credit card insurer.

Delays, lost baggage, etc.

Bottom line: using our current card gives us fairly good insurance protection and a gain of $853 (-25+300+100+378).

The strength and weakness of this card, which has served us so well up to now, lies in the earnings applicable to flights; but on anything other than flights, and particularly for cruise or tour packages, alas, there aren’t many earnings available.

Can we do better with Milesopedia‘s information, strategies and tips?

Let’s check this out with the next strategies.

2. Explore welcome bonuses on non-travel cards

An approach that I’ll mention here to better exclude it: there are several cards that offer generous welcome bonuses, very generous indeed.

Let’s take a card like the American Express^® Business Gold Rewards Card^® : You and your partner can earn over 150,000 Membership Rewards points if you spend $5,000 in three months on each card (note that American Express cards are accepted by most travel agencies). With a conservative valuation of points, get more than $2,250, for a gain of $1,850 ($2,250 – $400 for annual card fees).

The big problems with this approach:

• No insurance coverage (baggage, trip cancellation or interruption, etc.) All these protections are only available if you book your trip on a credit card that offers them, or deal directly with an insurer, which can cost several hundred dollars.
• No medical insurance either. This type of protection does not require you to book your trip on the card, but you will need to apply for a second card to be covered or deal with an insurer (again, several hundred dollars).
• No travel credit to use for baggage fees, upgrades, seats, and no lounge access; all this will have to be offset with other credit cards if we want to reduce the cost of our trip.

Bottom line: it’s better to unlock the rewards of these cards with other types of expenditure (car deposit, major furniture purchase, renovations, dentist, taxes with Paysimply, etc.).

3. Welcome bonuses on travel cards

We’ve just excluded a bunch of non-travel cards, but there are still plenty to consider.

To sum up what we’re looking for here:

• Good travel and medical insurance. Remember that to benefit from non-medical travel insurance, it is necessary to charge travel expenses to the card.
• A good welcome bonus (we have a big expense to unlock it if need be)
• Ideally, lounge access and travel credits to cover expenses related to seat selection, luggage and lounges.
• Flexible points: many cards points redemptions are less generous when you book a package outside their travel portal. We also want to apply as many points as possible to the package at the time of booking to reduce the cost.
• A points earning rate that best suits our spending profile.
• • As the trip is scheduled for summer 2024 and we started our strategy 18 months in advance, there was a good opportunity to earn reward points in addition to earning the welcome bonus. Our two biggest expense categories are groceries and recurring payments. We shop at Maxi (which does not accept American Express) and Costco (which only accepts Mastercard).

After our research, the card that stood out for us was the National Bank World Elite Mastercard^®, which met all our criteria very well.

• Flexible points that can be redeemed for travel not booked with À la carte Travel for a reasonable value (compared to booking with NBC).
• A nice welcome bonus, which we had time to unlock in part before booking the trip.
• Good medical and cancellation insurance. However, trip cancellation insurance only covers $2,500 per person (the only card that offers more is the American Express Platinum Card^®, but it doesn’t meet our criteria). As mentioned above, it is usually possible to purchase additional protection from the credit card insurer if required.
• Apoints accumulation structure that suits our shopping habits very well, and which can be multiplied with the technique of gift cards purchased in grocery stores:
• Access to the National Bank lounge at Montréal-Trudeau ($100 savings)
• An annual travel credit of $150 per calendar year, which could be used in 2023 and also in 2024. Example: we book the flight in December 2023, we use the travel credit to reserve the seats in 2023 with the National Bank World Elite Mastercard^®; then in 2024, we use the credit to pay the baggage fees.
• No annual fee for the first year (depending on the offer in effect)
• Accepted everywhere we shop (maxi and Costco)

Let’s do a little simulation here, taking these three criteria into account:

• We will get this card 18 months before the trip for both spouses.
• Each spouse reserves with the land portion at the end of 2023 (for departure in summer 2024),
• My old cards are no longer taken into account at this point (closed or substituted cards).

Here’s what are able to get:

• No annual fee for the first year, but you have to keep it for the second year; $300 in costs.
• Exchange rate charge of 2.5% on currency conversion (surcharge of $25 on $1,000 forecast)
• Savings on airport lounge in Montreal ($100)
• Savings on baggage fees ($300) (2024 travel credit can be used here)
• Savings on seat reservations ($200) (if the reservation is made in 2023, the 2023 travel credit can be used)
• Reward points
• • Bonuses unlocked: 60,000 x 2 = 120,000 points (bonus dating from 2023)
  • Points earned
  • • With travel package (land portion): 11,600 points
    • After 16 months’ use: 80,000 points (estimated)

Estimated value of these points: approximately $2,000

Total: (-300-25+300+200+100+2,000) = $2,275

• Part of the points can be applied to the next statement after booking (estimated at $1,000); the rest will be used for a future travel project.
• If you pay the Aeroplan fees with one of the National Bank cards at the time of booking, you can use part of your unused 2023 travel credits: potential for an additional $100 (and 10,000 points saved).

4. Is it better to complement with a second card?

Answer: YES!

An excellent candidate here is the Scotiabank Passport^® Visa Infinite +* Card.

It offers a nice welcome bonus that doesn’t require too much spending, so we can keep our main expenses on the National Bank World Elite Mastercard^® (which offers better point earning rate based on our spending). It complements this very well by offering zero foreign transaction fee. A good card to use when traveling, especially if you spend a lot outside Canada.

Here’s a summary of the benefits:

• No annual fee for the first year
• Scene+ points are easy to convert into statement credit, whether for groceries or travel.
• In the end, if my spouse and I sign up for this card, we will add :
• • $500 x 2 worth of points and very flexible use (travel, grocery or other expenses)
  • Free access to the Dragonpass network lounge at Dublin Airport ($100 value)
  • Savings on conversion fees of $25 (on our $1,000 in planned purchases during the trip)

It’s worth noting that this card could also have been used as a main card to save on a cruise or package tour, but when it comes to earn points, the National Bank World Elite Mastercard^® is more up our alley. What’s more, access to the National Bank lounge in Montreal and the card’s slightly more generous travel credit also weighed in the balance.

Bottom Line

Much to my surprise, I was expecting little gain from this type of trip. My little simulation showed that you can still save quite a bit (we’re talking about over $4,000 here!). ) and good insurance coverage for a trip where nothing is refundable in the event of a glitch. The 18 months of preparation made a huge difference in getting the maximum number of rewards and points and using the leverage of two different calendar years, which proves that earning points is a marathon. This demonstrates the need to have a concrete travel project to establish your strategy. As you can see, the cards I had for my previous trips were not the best for my 2024 summer project.

The results and decisions could be quite different for those who travel more often, have a different spending profile than me, deal with different banks and use different cards. If that’s the case, I encourage you to go through the same exercise as I did to find the strategy that pays off best for you (set your objectives, target your spending profile on the cards, compare with other travel-type cards, look for a complementary card).

And the National Bank World Elite Mastercard^® is a wonderful discovery. I plan to keep this card after the trip and make it our main card for future projects.