Advantages of Aeroplan and related credit cards with sign-up bonuses

First published on June 11, 2011

When it comes to credit cards, I usually recommend a no fee, cash-back reward credit card. This way, you can get money back for purchases you would normally make anyway, and then you can also decide to do whatever you want with that money. Even if you calculate that non-cash rewards have an equivalent monetary value higher than cash rewards, you must still factor in that the non-cash reward has to be used for a specific purpose, such buying a specific brand of car that might not seem desirable by the time you get around to using the points.

However, the Aeroplan system (and the several credit cards linked to it) deserves consideration for anyone who travels by air within Canada and the US. This is largely based on the fact that 25,000 points can be redeemed for a flight anywhere within Canada and the US (mostly on Air Canada, but also on other Star Alliance airlines), whether that’s from Vancouver to Oregon or Vancouver to Florida.

Unlike normal bookings, which have fluctuating prices depending on sales and time of year, the redemption level of 25,000 points is constant. Of course, Aeroplan seats are subject to availability: in the past I’d noticed that you often had to book quite far in advance, but I’ve noticed significantly increased availability since their announcement about the addition of more “last-minute” flights. As an extreme example, my business was looking at flights from Vancouver to Washington, DC to attend a conference. Even a month in advance, the cheapest return flights were $1,300, while there was plenty of availability through Aeroplan for most of the month. In this case, Aeroplan points can serve as a sort of insurance, or alternative option for flight bookings. You should do your own research to check availabilities on the routes you’re interested in.

Aeroplan miles / points are earned by flying, by using an Aeroplan-affiliated credit card, and by spending money at an Aeroplan partner such as Esso or Home Hardware. If you spend a lot and fly a lot, you might already have an Aeroplan account and possibly an Aeroplan-affiliated credit card that usually earns 1 to 1.5 miles / points per dollar spent. Some of the Aeroplan-affiliated credit cards come with rather enticing bonus offers, even when you factor in annual fees. (And there’s no reason why you can’t cancel the card before the first year is up.) For example, here are some current offers:

• American Express AeroplanPlus Gold: 20,000 mile bonus; must charge $1,000 in the first 3 months; $120 annual fee
• American Express AeroplanPlus Platinum: 50,000 mile bonus; must charge $1,000 in the first 3 months; $499 annual fee
• American Express Business Gold Rewards: 25,000 point bonus (1 point = 1 Aeroplan mile); must charge $1,000 in the first 3 months; first year free ($180 annual fee)

You should browse through the Aeroplan website or do a web search for full details on the affiliated credit cards.

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This entry is filed under Canadian Banking, Travelling and written by Peter Keung. You can follow any responses to this entry through the RSS 2.0 feed.