Do Aeroplan Miles Actually Save Travelers Money?

Posted on: May 29th, 2014 by paul

Aeroplan is one of Canada’s most notable rewards programs. Offered through Air Canada, it boasts itself as an easy way to reach a dream vacation destination by using the Aeroplan credit card for daily purchases. The truth of the matter is that most Canadians do not spend enough annually to make these dreams a reality. The multi million dollar marketing budget of Aeroplan does a good job gaining new clients that may not necessarily benefit from this card. Is this rewards card right for you?

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About the Card

Aeroplan is offered through TD Visa, CIBC Visa or American Express. Each bank and card type have different reward and fee structures. This means some research is required before deciding on which one to choose. For example, some card types offer extended travel insurance and other travel benefits that may already be covered under your company’s medical coverage so it’s redundant.

Annual Cost

The CIBC Aerogold has an annual fee of $120 and requires a minimum personal income of $60,000 to be eligible. Crank that fee up to $399 for the Aerogold Infinite Privilege card from CIBC. At the other end of the spectrum, the Aero Classic card only has a $29 per year and only requires a household minimum income of $15,000.

Benefits of Various Cards

What are the benefits of the Infinite Privilege card vs the Aerogold card? The Privilege card entitles the cardholder to things like priority check-in, priority boarding, complimentary first checked bag, and dedicated VIP security fast lane access. Having the card with the more expensive annual fee also allows the card holder to accumulate miles faster. Anywhere from 1.25 miles per dollar spent upwards of 3.75 miles per dollar spent can be earned at participating CIBC Bonus Rewards establishments.

Points Required

Travelers can get on board round trip flights for as little as 15,000 points for short haul trips in Canada and the continental USA. Other key numbers are: 25,000 points for long haul flights in North America,  40,000 for the Caribbean and Mexico, 45,000 for Hawaii, 60,000 for most of Western Europe, 75,000 for most of Eastern Europe, and 75,000-90,000 for Asia.

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Keep in mind that even though travelers are paying for their flights with points, the taxes must still be paid. This can mean paying upwards of $700 for a flight to Europe. This is where the cost-benefit discussion comes into play. Is it possible to find the same flight for less than the cost of taxes and annual fees? This is an important factor to consider.

Overall, a points card can be beneficial depending on the circumstances. Business owners and people in large families can accumulate points from multiple cards. Frequent travelers can benefit from the Privilege card by having priority access at airports.  However, single card holders that do not use their card often and don’t travel will have little use for the card. The bottom line is that some research is required before making the long term commitment to a credit card points program.

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