the looming MBNA devaluation, and introducing its replacement

I used to love my MBNA World Elite Mastercard and I would link to it all the time. This was a fantastic card because it would give you a 2% cash back rebate across the board. You wouldn't have to wait until you were booking travel, you could simply just ask for cash back in the form of a statement credit or even a check. How great was that?! I even had the grandfathered version, where the annual fee was permanently waived.

Back in September 2018, I received a letter from them telling me about a important devaluation for this card. From what I've gathered, this is only for the grandfathered $0 annual fee World Elite Mastercards.

• points earning would go down from 2 points per dollar to 1 point per dollar (except for a few handful of categories where it would stay at 2 points per dollar up to the first $5,000 in spending a year). earnings would decrease by 50%
• points redeeming would remain the same if spent on travel purchases. If not, they could be redeemed at a rate of 200 points = 1 dollar. this is a devaluation of up to 50%. 
• taken together, this card has gone from getting a 2% return on all purchases, to a 0.5%-1% return on most purchases

This isn't going to work for me.

Their equivalent is a $120 a year MBNA rewards world elite mastercard. If you sign up through great canadian rebates, you'll receive a $60 rebate. 

MBNA Rewards World Elite Mastercard

Their new card (which isn't actually new, and is going through its own devaluation) still isn't quite as good as the old one.

• first, an annual fee is still present. In fact, it becomes $120 a year
• point earnings are still 2 points per dollar spent
• redemptions remain 2% return if used for travel, but 1.66% return if used for cash back.

I'm currently using the TD First Class Visa for its 1.5% return on general expenses (if redeemed for travel purchases) and 4.5% return on travel purchases (if redeemed for travel purchases). Its 120$ annual fee is waived because I have the TD all inclusive banking account.

TD First Class Travel Visa

So the difference between the MBNA Rewards World Elite Mastercard and the TD First Class visa is:

• $120 annual fee 
• 0.5% higher rate of return with MBNA
• one requires a $24,000 spend in order to break even.

Do I just make the switch and pay yet another annual fee? Time to think about this some more ...

New: Cobalt American Express

For the longest time, I've been using the Scotia Bank American Express Gold. Briefly, it has a 99$ annual fee, comes with premium insurance for tickets purchased with the card, and gives you a 4% return on gas, grocery, dining, and entertainment expenses. You have to redeem your 4% rewards in the way of travel in order to get the highest rate of return. Gas, grocery, dining, and entertainment cover a lot of purchases.

The downside to this card is that a) it is an AMEX (which is not as well accepted as other places), and b) non bonused spend receives a 1% return. If you buy your travel on this card, you will get great travel insurance, but you will get a poor rate of return.

Introducing the American Express Cobalt Card

 
I was recently looking at the American Express Cobalt Card. It's a new card that was recently introduced. You earn Membership Rewards points for the following:

• 5 points per dollar spent on dining and grocery store purchases
• 2 points per dollar on gas station, travel purchases, and commuter / transit purchases (no other credit card offers 2% return on travel with all the insurance premiums).
• 1 point per dollar on everything else

Again, not everyone accepts AMEX, which continues to be a major limitation. Its annual fee is slightly higher than the gold card at 120$ a month, payable in 10% installments.

What does one do with Membership Rewards (MR) points?

• Convert them at a 1:1 ratio with Air Canada's Aeroplan or Hilton HHonor's programs
• Convert them at a 1 : 0.75 ratio with Delta, British Airways, Etihad, Cathay Pacific, and Alitalia's frequent flyer points
• Convert them at a 1 : 0.5 ratio for Starwood Preferred Guest  
• Convert them to gift cards at a 0.83% return (3000 MR points for a 25$ gift card -- a poor value)
• Buy toasters at an even worse value

I have recently fallen out of favour of hoarding airline miles because of the difficulty in finding availability for fixed date travel (my work is not very flexible in what days I can leave). So one of the more interesting finds was their own reward chart.

• 15,000 points (max ticket value = 300$) for a select list of popular routes
• 20,000 points (max ticket value = 300$) for a travel to same or adjacent provinces/states
• 40,000 points (max ticket value = 700$) for North American travel
• 60,000 points (max ticket value = 900$) for European travel
• 100,000 points (max ticket value = 1,700$) for Asia/Pacific/Australia travel
• Or 1% back rebated to any other charged travel

If prices are above the max ticket value before tax, then you pay that in addition to the taxes.

This is potentially quite lucrative because it can be up to a 2c/point return on the popular YVR-YYC route (tickets are almost always above 300$ before taxes during times like Christmas). And if you earned 5 points per dollar spent at a restaurant, then that's potentially a 10% return.

The points earned on these airplane tickets themselves earn points, and they are not subjected to capacity controls.

I'm thinking about making the switch ...

store credit cards aren't always bad ...

sometimes, i spend a lot of time in my head justifying the cards that i have. normally, my pattern is as such:

• i keep all of my gas/dining/grocery/entertainment expenses on my scotiabank gold american express card for the 4% cash back return. 
• i keep all of my non-amex purchases, or non-gas/dining/grocery/entertainment expenses on my MBNA card for the 2% cash back return. (no longer available)
• i keep all of my foreign transactions on my sears financial mastercard for the 1% back in sears purchases and 0% foreign exchange fees.

given the decline of sears and all of the store closures, and how hard it was to redeem points without physical stores, i was contemplating switching to the amazon.ca rewards visa also offered by chase. like the sears card, it also has no foreign exchange fees, offers 1% cash back, and 2% cash back on amazon.ca purchases.

but there's something to be said about store credit cards and how helpful they can be. i was walking through sears today (it's right beside my work). it's one of the numerous stores closing down. everything was outlet pricing in an attempt to clear out the store. and on top of that, there was an additional 10% off if you were a sears card holder.

sears certainly isn't the only one to give a discount when using their credit card in store.

• target's red card gives you back 5% on target purchases when it's linked to any debit card.
• hbc financial's mastercard gives you bonus points for purchases, but it's not uncommon to have 10% savings especially for hbc card holders
• note: typically $1 spent on the card = 2 point, and 40 points = 1 air mile if you choose to redeem for airmiles, 2,000 points = $10 hbc gift cards. this works out to about a 1% return
• macy's credit card in america offers star rewards. the more you spend per year at macy's, the more you spend, the more mailings and 25% off vouchers you get per year. however, it feels like every weekend i'm there, they have an additional 10% off for macy's credit card holders.
• in seattle, they readily allow canadians to apply, most likely because of all of the traffic from vancouver. this works best if you make a purchase, get the discount, and before even leaving the till, pay off the credit card with american cash.
• banana republic, the gap, nordstrom's and many more all have similar cards but are not open to canadians.

so this is all to say that sometimes, focusing on that 4% return from amex is not the best deal. sometimes, paying via debit or store credit is worth thinking about too. in the end, if you can save 10% off in store on top of other discounts, that surely outweighs the 2-4% return you get from your regular credit cards. and i have yet to find any mileage based reward card that would offer a 10% return on spendings.

sears financial gets to stay in my wallet just a little while longer. at least until the store that's right beside my workplace closes its doors for good.

and back from a hiatus: no longer a pivot visa user, changes to the sears mastercard

i'm back from a hiatus. this was the royal college exam year for me, and so who knew that it would take this much effort to pass an exam? but it's over and done now, with only good results. as of this summer, i'll be my own independent physician in practice.

there are a few things that i noticed in the last couple of months (among many). but some of the unique propositions that i've written about have changed for me.

1) pivot visa by petro canada is now too hard to use
i've had to stop using this because of the inability to buy reloadable cards. i've tried to use my scotia bank gold american express (4% cash back at gas stations), and invariably, the attendants would turn me down. common reasons were: "oh, our machine is broken today" (some people might push the issue, but i don't), "oh, let me call our authorization centre ... oh, we are still on hold ...", and probably the most truthful, "we don't accept credit cards for those kinds of purchases." i respect that.

but because i can't reload the card anymore using the american express, there is no longer any value in keeping the reloadable visa card. i've paid $10 to buy the card and $59.95 for the annual option, but luckily, i was able to more than break even.

2) sears and petro-canada are no longer partners
i logged into my petro-points account recently and found out that sears points and petro-points are no longer transferable.

it kind of makes sense given sears' difficulty in canada. i don't normally care for sears points except that i have their sears financial no-forex, no-fee mastercard. it was an amazing opportunity where $1 spent on the card earned 12 petro-canada points, which could then be turned into 1.2 asia miles. i have yet to find a card that is this generous. but sadly, it's no longer an option. had i known, i would have transferred my points out before the deadline, but i missed the announcement. if there was an announcement.

given the difficulty in redeeming sears points in store (namely because the stores are disappearing quickly), i think the best recommendation for no-forex, no-fee cards is now the chase amazon 1% cash back card. the original discussion was here, but is now in need of an update.

aeroplan td visa cards -- information now online

earlier today, td announced their 4 new card products:

1) td aeroplan visa infinite privilege card

 

• annual fee: $399
• welcome bonus 25,000 pts
• minimum requirements: $200,000 annual household income or $50,000 spend
• 1.5 miles/$ for gas, grocery, drug store purchases
• 1.25 miles/$ for everything else
• complimentary checked bag, priority check-in and boarding, 4 maple leaf lounge passes a year, all applicable to any air canada operated flight
• global airport lounge service -- not fully defined, but only a set number of uses allowed
• out of province medical ($5 million), trip delay/interruption/cancellation, common carrier travel accident, delayed/lost baggage, auto rental LDW insurance
• purchase protection and extended warranty

 2) td aeroplan infinite visa 

• annual fee: $120
• welcome bonus 15,000 pts
• minimum requirements: $60,000 annual personal income or $100,000 spend
• 1.5 miles/$ for gas, grocery, drug store purchases
• 1 miles/$ for everything else
• complimentary checked bag, priority check-in and boarding, 4 maple leaf lounge passes a year, all applicable to air canada operated reward flights only
• out of province medical, trip delay/interruption/cancellation, common carrier travel accident, delayed/lost baggage, auto rental LDW insurance
• purchase protection and extended warranty

 3) td aeroplan platinum visa

• annual fee: $89
• welcome bonus 10,000 points
• minimum requirements: $12,000 annual income
• 1 mile/$ for gas, grocery, drug store purchases
• 1 miles/$1.50 for everything else
• trip delay/interruption, common carrier travel accident, delayed/lost baggage, auto rental LDW insurance
• purchase protection and extended warranty

 4) td aeroplan visa business card

• similar to the infinite, except with an annual fee of $149

initial thoughts
at 1 point per $1 spend on what will most likely be their most popular card, i'm not completely certain about its value. i wrote about the capital one travel aspire mastercard in my previous post. for an equivalent of a $20 annual fee, you get all of the insurances and a guaranteed 2% return provided that you've redeemed your points for a travel cost greater than $600.

when i booked my almost-all-business class tickets to asia, i calculated a 4.13 cent per mile return. this assumes that you're willing to value the business class ticket at the prices they sell them at. i bet that most people wouldn't. this also assumes that you can find availability, which is never guaranteed. and compared to the capital one mastercard, redeeming for economy class tickets rarely ever makes sense

if comparing to another airline points-based credit card, i would suggest that the starwood preferred guest american express wins. with a 1 starpoint per dollar spent, and with each starpoint being worth 1.25 points in over 25 different airline programs, the starwood preferred guest amex wins. the only downside is its limited acceptance amongst merchants.

alternatively, if one were to try out the capital one delta skymiles world mastercard, you would get 2 skymiles per dollar spent, and 10,000 bonus points after $25,000 in annual spending. if skyteam had a stronger presence in canada, this would also be a much stronger card than these td aeroplan cards.

additional flight benefits
as a star gold member, i already get these benefits. it certainly adds benefits for the occasional flyer flying on rewards. when i first read through the information, i thought that it would give priority boarding and check in to all cardholders flying any air canada flight. thankfully, that is not the case (as it is with credit card holders in the states). it also creates only a very minor dilution in the actual benefits of elite status, which i think will be tolerable enough.

overall
i struggle to find enough value in these aeroplan cards to justify using one of them for my everyday spending. the sign up bonuses, however, may be worthwhile.

updating the canadian cash back card list: MBNA 2% (with a fee) is back!

back in april, i wrote a list of all the credit cards offering cash back. that post is here for the raw details. but then i found that a few of the cards needed updates, and i thought it would be helpful to point out. the original had many kinds of cash back cards, and really, some of them are not even worth repeating because the rate of return is insulting. so i'll just focus on the stronger cards.

1) capital one cash back card downgraded to 1% cash back
back in april, i noted that this no-annual fee card gave 1% cash back on all purchases and then topped it off with a 50% bonus at the end of the year. this would give an effective rebate of 1.5%. after taking a look at their website today, it looks like the bonus is gone. this makes the card no different than most other 1% cash back card. that being said, it does have strong insurance offerings, including price protection (up to $100 within 60 days), extended warranty, purchase protection, baggage theft, car rental, and common carrier accident insurance.

2) MBNA rewards world elite mastercard is back!
grandfathered from the old days, i have the mbna rewards world elite mastercard with the annual fee waived yearly. the perk was that it gave 2% cash back across the board. they don't allow you to sign up for the free version, but they once again allow you to sign up for the $89 annual fee version. this also comes with price protection, concierge service, purchase protection, extended warranty, rental car, common carrier, personal effects insurance etc. it's a strong card.

is the MBNA rewards world elite (RWE) worth it with the annual fee?
if you're comparing this to any of the other free 1% credit cards out there, then you have to spend the equivalent of $8,900 a year to simply break even with the 1% cards. this is to say that the extra 1% earned on the MBNA RWE after spending $8,900 will pay back the annual fee. any additional spending on the RWE will give you a better rate of return. (i.e., greater than 1%)

is the capital one aspire travel world mastercard a good deal?
compared to the MBNA RWE, the capital one aspire travel world mastercard it is a great deal. for each dollar spent, you receive up to 2% cash back (provided that the travel that you want to spend your points on is greater than $600). the annual fee is $120, but it is offset by the $100 yearly credit, making the effective annual fee $20. its insurance package is just as strong, if not stronger, than the MBNA RWE. it includes travel medical, trip cancellation and trip interruption insurance.

if you have the capital one aspire travel world mastercard, compared to the no-fee 1% cards, you would need to spend $2,000 a year in order to break even on the annual fee. everything after that will net you a higher rate of return.  (i.e., greater than 1%)

where does the pivot visa come into play?
if you're able to use the scotiabank amex gold card with its $99 annual fee, you can get a 4% return on pivot reloadable visa purchases. by buying the pivot visa's $69.95 annual fee version, you can get at least a 3.2% return on all purchases (except for gas/grocery/dining/entertainment, which would use your scotia bank amex gold card for its 4% return). i wrote about this strategy extensively here.

if you were to do the scotiabank amex gold card and the pivot visa's $69.95 annual fee, you will pay a total of $168.95. assuming that you don't get any additional gas/grocery/dining/entertainment expenses on your scotiabank amex gold card, which is unlikely, your minimum rate of return is 3.2%. because you will spend money on gas/grocery/dining/entertainment, your rate of return will likely be higher than just 3.2%.

• compared to the regular 1% cash back cards (like the PC financial cards that everyone is carrying these days), you would only need to spend $7,679 a year to break even on the annual fees. everything after that would get you a higher rate of return. (i.e., greater than 1%)
• compared to just the capital one aspire travel mastercard, you would pay an extra $148.95 in annual fees. therefore, you would need to spend $12,412.50 in order to break even. anything after than would net you a higher rate of return. (i.e., greater than 2%)

what if you don't want the pivot visa? would you just add the scotia bank amex gold card?
the pivot visa is a nuisance sometimes because some petro-canada stations don't like to sell these cards. so what about other comparisons can you make?

• if you have the world aspire mastercard, you would do even better with the addition of the scotia bank gold american express card strictly for gas, grocery, dining, and entertainment expenses. you would need to spend $4,950 in those special categories a year in order to break even with the $99 annual fee. any additional spending above $4,950 in those categories will net you an overall higher rate of return. (i.e., greater than 2%)
• if carrying two rewards cards with fees are too much, then you can just keep the 1% no fee cash back cards. in this case, in order to break even with the amex's $99 annual fee, one would need to spend just $3,300 a year. again, anything above this amount in those certain categories will net you a higher rate of return. (i.e., greater than 1%)

before applying for the scotia bank amex gold card, i would flip through your last 12 credit card statements to make sure that all gas/grocery/dining/entertainment expenses add up to the "break even" number (e.g., $4,950). note that walmart supercenter and costco, even though they sell groceries, do not count. 7-11 does, for whatever reason. also note that you can increase your rate of return by buying gift cards from safeway, petro-canada, 7-11 etc.

(note: i do not earn any form of affiliate rewards for any of these cards.)

a cyber monday offer for the scotia bank gold american express

my friend showed me a promo for the scotia bank gold american express card a few days ago. through this link via kanetix.ca you get a little bit more than you usually do.

as mentioned in my previous posts, this particular american express is very valuable. you get 4% back from your gas, grocery, dining, and entertainment expenses, and 1% back in everything else. it has a very decent insurance package. it comes with a $99 annual fee, compared to the $120 that comes with most other big name travel rewards cards. therefore, the best strategy is to use this for the bonused spending (gas, grocery, dining, entertainment), and the no-fee 1.25% capital one world cash back card or the no-fee 2% MBNA travel rewards card for all other purchases.

i've since learned that redeeming points is quite easy: you book your travel as you normally would though your regular channels (airline websites, travel agents, expedia etc). you log into your scotia bank rewards website, and it will list all of the eligible travel charges. you choose which one you want to redeem your points for (it will always work out to 1 pt = $0.01 off), and it takes gives you a credit on your next statement. no hassle whatsoever. no minimum redemption amounts, no tiered systems, no risk for blackouts, no odd travel connections, and it can be used for business class tickets. you can also earn points for these bookings too (from the airline/hotel chain, if applicable).

the best deal i've seen so far is 20,000 bonus points upon signing up, or a $200 credit statement. normally, the sign up deal is for 15,000 bonus points. via kanetix, you get:

• 15,000 bonus points
• your first year free ($99 value)
• and upon approval, kanetix will give you a 75% gift card

this is a much better deal than i got. and i would still recommend this card to everyone for now. please note that i don't get a referral commission from any of these links. i just really think they're a great deal!

pivot reloadable pre-paid visa: a case for the $59.95 version. (it's a 3.2% return!)

i wrote about the pivot visa card from petro canada a while back. briefly, this was a pre-paid visa card that you could use with fees associated with it. however, if you had the right credit card (e.g., the scotia bank gold american express), it was possible to earn an even better return per dollar spent. it was also an opportunity to buy the reload vouchers, load it onto the card, and then go to an atm to withdraw the money for straight cash. the return on that would be up to $5.00 in free cash.

with the latter option, there were a few things that i found:

• td bank, the one with the bank machines closest to work and home, raised their withdrawal fees for non-td cards. instead of charging $1.50 per withdrawal, they increased it to $1.95.
• they changed the withdrawal time frame -- the maximum withdrawal amount from an atm is now $250 per week as opposed to per day. i think they were catching on to what i was doing.

as i was buying more vouchers and perusing the rules of the card, it occurred to me that their $59.95/year option may hold some benefit. for this fee, you get unlimited transactions for free, have an increased monthly load amount of $5,000. you also get two fuel savings cards, and so you can spread around the fuel savings to more family and friends.

here's the math:
my current no-fee mbna travel rewards mastercard gives me a straight 2% back on all purchases in cash. my scotia bank gold amex gives me 4% back in travel money for all gas, grocery, dining, and entertainment purchases. therefore, by buying the petro canada reload cards to use on my pivot visa, i can get up to 4% back on all purchases as well.

therefore, if we use the $59.95 annual fee version of the pivot visa card, the only expense per every $250 reload voucher is the $2.00 reload fee. therefore, for every $250 spent, you would lose $2, or 0.8%. if we use the pivot visa for all of my mastercard purchases, then i would lose the 2% return from my mastercard and the 0.8% in pivot reload fees. instead, i'll gain 4% in my scotia amex. the net gain is a 3.2% return per dollar spent.

this is 1.2% more compared to my current mbna travel rewards mastercard. therefore, to make up for the $59.95 annual fee of the pivot visa, i would need to spend $4,995.83 a year. that is nothing. if one includes the scotia amex fee of $99 a year, that means that i would need to spend $13,245.83. therefore, everything before the $13,245.83 will earn a 2% return, and everything after will earn a 3.2% return. most people didn't jump onto the 2% mbna card while it was still available. therefore, when comparing this to the next best cash back card with a 1.5% return, the numbers are even more favorable.

this does not include the savings to be had in the form of the fuel savings reward card. for every dollar loaded onto the card, you get 5c off of one liter of gas. if i use the card as how i think i will, i can expect a permanent 5c off per liter of gas at petro-canada.

thoughts? is this too much work for an extra 1.2% more?

aeroplan likely to move from CIBC to TD ... with a few more details

a few weeks ago, i noted that aeroplan was going to partner with TD instead of CIBC. i didn't notice this but aeroplan had posted an FAQ on their website regarding this upcoming change. this can be found here. their official press release can be found here.

it's interesting to read through. some of the highlights:

• though cibc has first right of refusal, it is unlikely that they're going to match TD's offer. so it sounds like the affiliated bank will most likely change after all
• there will be multiple first-year free offerings throughout the year
• there will be three tiers of cards: mid-market (i.e., normal), premium, and enhanced premium (i.e., probable large annual fee). 
• there will be a higher earn rate with new benefits for the cards, although it's not fully described what that would involve. for the enhanced premium cards, there will be an enhanced earning rate as well.
• one wonders if these additional benefits will be like the mid-tier credit cards in america whereby cardholders can get pseudo-elite status. for example, the united mileage plus explorer card with its $95 annual fee gives the cardholder a free checked bag and priority boarding

TD offers the select service account, where if one can keep a minimum $5,000 minimum balance, they receive a whole range of free perks to the account. from their website:

• unlimited transactions (withdrawals, deposits, cheques, interac)
• free cheques
• free small safety deposit box
• free basic US account

what's probably the most relevant to this post is that their select service account offers a premium credit card product with the fee waived. some of their strongest offerings include their first class visa (1.5% return in travel money, excellent insurance offerings) and their gold elite credit card (1% return and complimentary TD deluxe auto club membership). one wonders if their new aeroplan co-branded credit card would be included in this. i will be waiting to find out ...

aeroplan adds "distinction" to its program, and TD may become aeroplan's credit card partner

so lots of news is happening in the aeroplan program. aeroplan is the spun off frequent flyer program for air canada, although to make things just that much more difficult, they are considered separate companies. their mutual contract runs until 2020, after which case, they can re-negotiate their terms or even part ways completely.

so it's with that in mind that i think aeroplan is adding a parallel status program called "distinction". there's some buzz on flyertalk about this new status program. instead of flight miles (as per air canada's altitude program), they have different tiers based on total earnings in a year from all coalition partners. it is unclear which partners count as coalition partners, although i'm sure it includes things like credit card spending.

• dSilver = 25,000 miles across all coalition partners in a calendar year
• dBlack = 50,000 miles across all coalition partners in a calendar year
• dDiamond = 100,000 miles across all coalition partners in a calendar year

different tiers offer different awards, according to the press release. their awards are also on the aeroplan website. 

what is probably the most important perk of this status is the air canada getaway bonus. receiving an extra 500-1500 points per eligible roundtrip flight finally puts air canada closer to par with westjet. remember that with westjet, you get 100% non-status miles on aadvantage, whereas previously, you would only get 25% non-status miles on air canada with aeroplan. but now a roundtrip YVR-YYC, if eligible, will give you 25% non status in addition to 500 bonus points for a total of roughly 712 miles roundtrip if you were a dSilver member (compared to westjet providing 852 aadvantage miles).

other major changes:

• replacing classic+ flights with "market fare" flights
• classic+ flights are based on the actual fare of the flight. using an unknown conversion rate, a certain amount of aeroplan points will be needed to redeem them. they are guaranteed to be at least 15% higher than classic rewards, although more is generally the norm (e.g., 800,000 points to fly to LHR in business ... plus taxes). they are now renaming it to "market fare" flights. in the benefits, when they say "up to 20% off" for dSilver members, it doesn't really mean anything to me.
• one way awards
• a big development is that one-way awards are now priced at half of round trip awards, which makes sense. it used to be 70% of a round trip price, but finally, that has changed. this is a great thing for which aeroplan should be given credit for.
• increase in classic rewards pricing
• they had just increased the prices of major awards a few years back, and they're doing it again. in the end, i suppose this makes up for the 50% one-way award change above. back when i first started with aeroplan back in about 1996, canada to asia (all of it) was 75,000 points in economy and 100,000 points in business. this was an almost free ticket -- no fuel surcharges to pay. now, with this increase, going to "asia 2"is 155,000 points -- an increase of over 50%. oh, and i forgot about the fuel surcharges.
• removal of the 7-year expiration policy
• while the 12-month expiration policy still holds (i.e., accounts with no activity in any 12-month period will be cancelled with all miles forfeited), not being forced to spend all the miles within that 7-year period is a nice touch. not that the value of those miles will stay constant, but at least you won't lose them due to time alone.

in summary, aeroplan distinction kind of reminds me of the airmiles gold program, except stronger as it offers additional benefits that members can actually use.

TD vs. CIBC for credit card partners
on an unrelated note from distinction, aeroplan and CIBC have been trying to renegotiate their current contract that is set to expire at the end of this year. CIBC had threatened to change things up if there were no significant concessions made by aeroplan. however, in a news release today, it looks like TD has put in a potential agreement with aeroplan. therefore, unless CIBC is willing to match, aeroplan may agree to partner with TD instead. from the news release, TD is willing to pay 15% more per mile, and a 100M upfront fee, as well as up to 400M to jointly market the card. TD really wants to play with aeroplan.

as with all new cards, i'm hoping for improvements above and beyond what is currently already offered. large sign up bonuses? baggage fee waivers? comprehensive and complimentary insurance packages (that exist with TD's existing credit cards)? mileage multipliers for gas/grocery/dining/entertainment (as per scotia bank's gold amex)? possibilities are endless.

petro-canada's pivot visa: a primer for getting a little bit more value out of your credit card purchases

petro-canada has really been promoting its pivot visa card lately. it's a reloadable card that you can buy at the retail gas stations. the start-up cost is roughly $10 to purchase the card. you can use it anywhere visa is used, including online.

in general, i don't believe in pre-paid cards.
there are two kinds of pre-paid cards: the reloadable kind and the non-reloadable kind.

• non reloadable cards usually charge an activation fee. the most favorable ratio is generally with the highest value card (e.g., $6.95 for 200$ vs. $3.95 for a 25$ vanilla non-reloadable mastercard).
• reloadable cards generally charge a fee for the card and then another charge a fee for each transaction or a monthly fee. furthermore, they usually don't let you re-load using a credit card.

i'd like to think that if you can get a regular credit card, then there is no need for either of these cards -- you shouldn't have to pay money to use a pre-paid card. but yet, i'm finding myself with a reloadable card in my wallet these days.

when the petro-canada pivot visa card came out, i did my own calculations, and i took the plunge to become a reloadable pre-paid card holder. i'll explain the bad stuff first (the fees) before the good stuff (the rewards).

the details: fees
i have the pay & go version. the whole fee structure is in the pictures below, but the most pertinent details are as such:

• price of card: $10 -- one time fee (the card itself expires in 3 years, like a regular credit card)
• cost of reloading a card via voucher: $2 regardless of denomination. you buy these vouchers at petro-canada stations. i've seen $25, $50, $100, and $250. it makes absolutely no sense to refill only $25 ... that's almost a 10% fee right there!
• when you reload it online, the $2 fee is taken out right away. in other words, when i enter a $250 card, my account is only credited $248. no taxes!
• you can reload a maximum of $500 a day, and $2000 a month
• cost of making a purchase = $0.49 each. this is on top of your regular purchases (e.g., on your $100 purchase, your account gets debited $100 and $0.49). making multiple small purchases is a bad use of the card.
• cost of withdrawing cash from an atm = $3 + whatever the atm operator charges (e.g., cibc / rbc = $2.00, td = $1.50)
• you can withdraw a maximum of $250 a day
• there is a spending cap of $2,500 a day
  

*note: purchasing these vouchers do not give you petro-points.

the details: i only use this card in conjunction with the scotia bank amex card
a few months ago, i successfully applied for the scotiabank american express card. this is a card with a $99 annual fee. the selling point of this card is that you get 4% in travel cash back in gas, grocery, dining, and entertainment, and 1% everywhere else. i repeat: purchases made at petro-canada give you a 4% return. in comparison to my 2% cash back mastercard, i get an additional 2% bonus using this amex. 

scenario 1: making actual purchases. i would only use this technique if a) there are no readily available gift cards for that store that you can purchase at grocery/gas stations, b) if the grocery store that you regularly use does not accept amex (like superstore), or c) if these are very large online non-bonused charges, like airline tickets.

• i buy large gift certificates at superstore. in order to buy a $500 superstore gift card, i need to buy 2.016 reloadable cards (because each $250 card will only credit $248 to my account) with a fee of $2 each. i will also be charged one purchase fee of $0.49. overall cost = (2.016 cards * $2/card) + $0.49 = $4.52
• if i were to spend 500$ on my regular 2% cash back card, i'd receive $10 in rewards. spending $504.52 on my amex card will give me $20.18 in rewards. so using my amex will get me an additional $10.18 in rewards. subtracting the $4.52 extra re-loadable card fees means that i get a net of $5.66 extra that i wouldn't have normally gotten from my 2% card. that's like an extra 1.13% in rewards that i wouldn't normally have.
• i would only use this method if i know that i can burn through this gift card reasonably quickly. with superstore, i know i can.

scenario 2: straight withdrawing from an ATM. it's possible but not recommended because the value to time ratio is so, so, so small.

• reload, deposit your pin online, and then withdraw $240 from the atm. for every $250 cycle, you pay $2 in reload fees, $3 in atm withdrawal fees, $1.50 in atm-provider fees. this is a total of $6.50 in fees.
• using the amex card, you will get 4% back on your 250$ purchase, or $10. this is a net profit of $3.50.
• buy 8 reload voucher at a time (to save time), but you can only load $500 a day.
• there is the risk of loss if a) you lose any of your unused vouchers, or b) if you misplace your $240 that you pull from the atm.

i've done both scenarios, and it works.

would this be worthwhile for any other kind of credit card?
this technique doesn't work very well with other cards in canada, unfortunately. this technique has been widely used in the states, in a process known as "manufactured spending". it only works if there is a significant bonus specifically for gas stations. another card which does this would be the cibc aerogold/adventura card which give an additional 50% miles for gas/grocery stores. that means that for every $1 in spending at a gas station, you get a bonus 0.5 aeroplan point.

using scenario 1 above, spending $500 on the aerogold card to buy 500$ in pivot visa vouchers to spend on $500 worth of travel would net you an additioanl 250 aeroplan points. this is at a cost of $4.52. therefore, you are buying each additional aeroplan point for 1.8c/mile. using scenario 2 above, you will receive 375 aeroplan points to buy the voucher, and pay $6.50, which is about equal to 1.73c/mile. given my previous analysis of the value of an aeroplan mile, it seems a bit steep. (link: cash back credit card comparison)

one last benefit: fuel savings!
when you buy the card, they provide you with an fuel savings card that's linked to your account online. for every dollar you reload onto your card, you get 5c off of one liter of gas to a max of 250 liters at any given time. so for every $250 load, you'll top up your fuel savings card to 250L. i'll probably give this to my parents and brother to use since they burn through gas faster than i do (i tend to fill up south of the border). at 5c a liter, and using maybe 300L a month, that's an additional reward of $15 a month.

final thoughts:
i'm really hoping for a better card product in canada that would provide a better bonus for spending at gas stations. if there is such a product, i'm sure i'd be maxing out this this pivot visa every single month. for now, it's just a game of convenience -- i'd only do this if i were already at a petro-canada station for some other reason. i would never go out of my way to do this -- the few extra dollars i get from this aren't worth the extra gas money ;)

revisiting old posts, updates: plastiq, wings, scotiabank amex gold

just wanted to quickly post to update on a few of my previous posts:

1. paying taxes with your credit card via plastiq.com. i did this back in april, and everything went through. as you may recall, they charge an additional 2% surcharge to make up for the fees. however, after doing the math, since i'd be given a cash rebate of 2% on the purchase price and the additional surcharge, i ended up saving $0.42 on my taxes. i was a bit worried when my notice of assessment revealed a balance still owing, so i registered for a canada revenue agency (CRA) account to investigate. as it turns out, my taxes were paid to the CRA on the same date as i paid them. i have no balance owing. and it turned out to be regular purchase as opposed to a cash advance. so plastiq.com works as advertised. i'll use it again next time.
2. buying products and getting them free using a mail-in-rebate. this time, it was for the quantum dish soap. i bought the product for around $6. and they rebated both the taxes and the postage. received the check $7.32 today. 
3. i did not end up doing the yyj-yvr-sea-yvr run for "aeroplan's earn your wings" contest. at 3.23c/mile and a full day's worth of travel, it didn't seem to be worthwhile to me. plus, as mentioned in previous posts, if you can't actually redeem the mile itself because of lack of seats, then the actual value of the mile approaches zero.
4. applying for and using the scotiabank american express gold card. as per my previous post, i did indeed keep using my 2% MBNA cash back card for most of my everyday purchases. for gas, grocery, dining, and entertainment, i signed up for the scotia bank card for 4% travel rewards. the card works like a charm and indeed rewards me for what i should be rewarded for. no troubles there. however, the application process was frustrating and repetitive.

• they wanted proof of income, so i had to fax in my pay stub. i've had that happen before, so that's fine
• they wanted proof of my identity, so i had to go into the branch to meet with a banking representative (not just an ordinary teller) so that i could sign some forms. i had to go in during specific work hours for this. they also wanted me to provide proof of address and employment, and so they suggested that i bring my pay stub in again. i take that as evidence that their departments don't talk to one another, which is never a good sign.
• they wouldn't let me have online access to my account initially as i was not a scotia customer. however, when i came back at a later time to submit a voided check for pre-authorized debit, without batting an eye, the teller simply created a customer card and login for me. so for now i'm a happy customer.

what goes into a credit rating?

over the last few weeks, i've posted so much stuff about credit cards. i think credit cards are one of the easiest ways to earn a little something extra for the things that you would do everyday anyway. certainly, there is a whole culture out there who simply churn credit cards for the sign up bonuses. that is, they sign up, get the bonus, cancel, sign up again, get the bonus, and the cycle goes on. i haven't actually churned, but i've heard so many reports of how wonderfully it works.

i haven't done it so much because i'm always afraid of the hit to the credit rating. yes, credit scores do go down whenever you ask for credit. however, this is a temporary effect. but given that the bf and i are looking at buying a place in the near future, i'm not going to be so eager to do anything to hurt the credit rating, even if temporarily. you never know when the next big opportunity will arise, although i'm pretty sure it won't be within the next year.

my friend asked me about what goes into a credit score, and what to do about credit card accounts that were used primarily for obtaining the sign up bonus but aren't used anymore.

i dug up a thread that i thought was particularly helpful: it's redflagdeal's "ask me about credit scores" thread. there are certainly many opinions out there, as well as some facts available if you're interested. however, there are two other sites that i found very helpful:

1. you can use this canadian-based website to predict what your score would be. they give a very general ballpark as to what your score would be. it's anonymous and free.
2. another website gives you a more broken down version of what makes up your credit score (it's a much easier visual representation than what you'd find in the thread). to summarize:
• 35% = payment history. yes, if you screw up the basics of credit, then you've screwed up a big chunk of your credit rating. that's only fair.
• 30% = how much is owed. both the total amount that you owe at any given time (i.e., add up all that you owe on your credit cards) and the ratio between how much you owe and how much credit you have. for example, using up $1,000 of your total $100,000 credit limit looks a lot better than using up $1,000 of your $10,000 credit limit.
• 15% = length of credit history. the "older" the average age of your accounts, the higher the score
• 10% = types of credit used.
• 10% = number of new applications in the past 5 years. how it's actually calculated is beyond me, although most banking representatives that i've spoken with suggest that the impact of a new inquiry on your credit rating only lasts for 6-12 months or so. 

  

  http://www.mymoneycoach.ca/credit_rating/what-is-credit-score.html

this being said, different banks will look at the details of each part of your score. the interest rate that you qualify for may be score dependent, but can also be based on other individual factors within the credit report. for example, having 6 credit applications within a month may be viewed by bankers as a desperate grab for more money, which is definitely not what bankers are pleased to see.

what does this mean? the basic rules that i've taken from this (and someone please feel free to correct me if i'm wrong) are:

1. the most important of all: if you can't pay your balances (or minimums) on time, then credit cards are not for you. in fact, as a rule of thumb, if you can't pay off your card in full each month, then credit cards are not for you period.  the interest alone far outweighs the benefits of the points that you will earn.
2. if you have an old credit card, unless you're looking to churn it for another sign up bonus or there's an annual fee associated with it, don't cancel. i keep a whole deck of cards stashed in a drawer and never to be touched. it keeps the average age of your account older this way.
3. if you have a card that you no longer use, it doesn't hurt to keep the credit limit the same. reducing the credit limit may actually work to reduce your score in the 30% category.
4. if you are looking to apply for a mortgage in the near future where having a favorable credit score may mean the difference between a good rate and a great rate, then keep the number of credit applications to minimum.

and of course, as a reminder, you can get your free credit reports (not scores) from equifax and transunion every year. (the links above will take you directly to the forms to fill out -- no need to hunt on the website for them).

capital one's delta-affiliated credit cards

i don't often see advertising for capital one's delta skymiles world mastercard. i suppose this is just a reflection of how little market share delta has in canada.

about the card

• you earn 3 delta skymiles for every dollar spent on delta purchases
• you earn 2 delta skymiles for every dollar spent everywhere else
• after spending $25,000 a year, you get a 10,000 annual bonus (this is where manufactured spending, or paying your taxes through plastiq may make sense)
• a welcome bonus of 25,000 points in your first year after spending $1,000 in the first 90 days.
• it has an insurance package comparable to the capital one world cash back cards. in other words, it has out of province travel insurance, trip cancellation/interruption, travel accident, baggage delay/loss, extended warranty, purchase protection, rental car insurance
• annual fee of $120 a year

the annual fee is the same as most of the other premium cards, including the aeroplan-affiliated CIBC cards. however, you get twice the miles per dollar spent. so in the first year, if you spend $25,000 (and $1,000 in your first 90 days), you will receive 85,000 skymiles.

alternatively, you can go for the capital one delta skymiles gold mastercard which has no annual fee and still gives you a 1 mile per dollar spent. it also provides almost all of the same insurances as the world mastercard.

if you do decide to apply for those cards, make sure you apply via great canadian rebates and not the links above in order to receive a $30 (world) or $20 (gold) rebate paid via paypal. (note: i receive a referral from great canadian rebates if you sign up for the program, but i receive nothing for the actual cards).

about delta
delta is an american legacy airline that's a member of the skyteam alliance. the redemption chart is shown below. note that these are one-way prices.

low, medium, and high don't refer to the travel season, but rather the number of capacity controlled seats available. there is lowest availability for the low seats (hence the lowest price), the highest capacity controlled seats available for the high seats (hence the highest price). i suspect that the difference between low vs. medium/high is equivalent to aeroplan's classic and classic plus redemptions. so in reality, the amount of miles required to redeem remain the same. however, i've also heard of reports that delta's award program is very, very broken. gary from view from the wing describes it here.

also, as of this post, delta miles do not expire unless you expire.

when does collecting delta make sense?
the credit card certainly has its positives, but it would then only make sense if you can actually use these miles. it is also helpful if you fly in delta/skyteam/partner cities so that flights could further accumulate points. so the biggest criteria is that you value the destinations that delta serves frequently, or that are a part of the skyteam. it would also help if you lived in an actual delta city or skyteam destination city. i've dug them up below:

• vancouver: alaska, delta, china airlines, china eastern, china southern, klm, korea
• toronto: aeroflot, air france, alaska, alitalia, delta, klm, korean
• montreal: aeromexico, air france, delta, klm
• calgary: alaska, delta, klm
• edmonton: alaska, delta, klm
• other alaska cities: kelowna, victoria
• other delta cities: saskatoon, winnipeg

for those who live close to border cities, it might make sense to drive across the border:

• seattle (vancouver):  alaska, delta, hawaiian, korean
• buffalo (toronto): delta
• burlington (montreal?): delta 
• detroit (windsor): delta

in other words, this card works best for canadians living in toronto or vancouver.

conclusion
the capital one credit card might be a good fit. it certainly is very interesting that you can earn without having to pay an annual fee, or earn double while paying an equivalent annual fee to the other major airline-affiliated credit cards. that being said, the utility of delta miles may be so limited in canada that the other major credit card issuers do not feel the need to either strengthen their card products or reduce their annual fees. i think they may be right.

why i'd rather choose the cibc adventura mastercard over their aerogold visa

aeroplan has another point conversion bonus promotion happening between now and may 13, 2013. this is something that happens 2-3 times a year for at least the last few years. if you're in love with the aeroplan program, or have super-elite status whereby you can redeem your points at the classic reward price for any available air canada seat, this is a great time to convert points. you receive bonuses depending on how much you transfer in. if you transfer 20,000, you get a 25% bonus. if you transfer 150,000, you get a 26.7% bonus.

i particularly like the starwood program because with the spg amex, you earn 1 point/dollar spent. 20,000 spg points can be converted into 25,000 aeroplan points. these extra 5,000 points are a regular part of the starwood program. if you transfer 40,000 spg points, you will then receive 50,000 aeroplan points. according to this aeroplan bonus, you'll get an additional 10,000 points. thus 40,000 spg points = 60,000 aeroplan points. great deal.

CIBC has a similar option to transfer into aeroplan. however, because aeroplan runs this promotion many times a year, it makes sense to earn your points via their adventura world elite mastercard rather than their aerogold visa. these cards are virtually identical, including a 50% bonus on gas, grocery, and drug stores, as well as the $120 annual fee. the adventura mastercard has a stronger insurance package.

the trick is that the adventura mastercard earns adventura points which can be converted 1:1 to aeroplan points (in 10,000 point increments). aerogold visa earns the aeroplan points directly. so during these promotions, you earn bonus points for converting your adventura points, but you get nothing from your aerogold because there's nothing to convert. therefore, if you're interested in earning more aeroplan points, the adventura mastercard effectively gives you a 25% bonus over the aerogold.

paying taxes via credit card -- plastiq.com

plastiq is a service that has recently been introduced in canada. it has a simple idea: if you are being forced to pay for something online via debit or cash, you can now pay for it with credit card via plastiq. the merchant has probably elected not to use credit cards because of the processing fees that mastercard / visa / amex charge (around 2-5%). plastiq lets you pay for the item but instead will charge you a flat transaction fee of 2%. they promise that it counts as a purchase, not as a cash advance which would accrue interest charges immediately.

this, in itself, is not that exciting. if you use a points credit card and you get one point per dollar spent, you're ending up paying an extra 2c per point. it's not that great a deal. how it is helpful is for helping one meet minimum spending targets. for example, the starwood preferred guest american express will give you a free weekend award night after spending $40,000 a year. what if you're expecting to be shy of that number at the end of the year? you may need to manufacture a little bit of extra spending in order to reach that threshold. this is where plastiq comes in handy.

i did my taxes online with h&rblock.ca again this year (thanks to my $7 coupon code from pcfinancial). this time, they announced their partnership with plastiq, saying that you could pay your taxes online. i figured it was legitimate enough and i wanted to test it out.

1) this was the initial webpage after paying my taxes. i clicked the orange tab.

 2) this is plastiq's landing page. the next page asks you for your canada revenue agency details, the amount owed and credit card details.

 3) review and submit your payment. note that the math was correct in terms of the fee.

4) after hitting submit, you get to see a confirmation that your payment has been completed. they e-mail you a receipt and a transaction number that you can follow up with.

easy! i'll check back to make sure that it works, of course. i'll also be keeping an eye out to make sure that none of it is treated like a cash advance. if it works out, then this will be a great tool to generate additional spend on my cards in order to meet minimum thresholds.

just as an aside, the amount that i owed was $1,203.29. i paid $1,227.36. using my 2% cash back card, i expect to $24.55 back in rebates. so the actual amount that i paid in taxes was $1,227.36 - $24.55 = $1,202.81. in other words, i actually saved $0.48. just a small detail, of course ...

the value of an aeroplan point

in my previous post, i looked at the value of the cash back credit card. the return value is very transparent: you will get x% back in cash or y% back in travel dollars. you know the exact rate of return, which is not such a bad thing. my current card, the no-fee MBNA world points mastercard gives 2% cash back. the other card i was talking about, the capital one aspire travel world mastercard, gives 2% back in travel dollars with an effective annual fee of $20.

what's harder to calculate, however, are those that give travel reward points, especially for airlines. the big question is: what is an aeroplan point (or whatever point you choose to collect) worth? so i chose to do a quick estimation of worth using aeroplan. i chose a sample date, and i chose awards that closely approximated what i could buy using cash (i.e., a revenue ticket). of note, there are some limitations:

• various programs will charge fuel surcharges on certain airlines, while others won't
• various programs charge differing numbers of points, although they tend to be similar
• reward seats are much, much, much more limited than revenue seats
• to use reward seats, some sacrifices may have to be made within reason to scheduling
• low season vs. high season rates affect rates of return
• there are possibilities for open jaws, stopovers for points, but usually you can build those into your revenue tickets yourself for not that much more
• revenue seats can earn points that can be re-invested into booking future reward tickets

the international traveler on air canada:
route: YVR-HKG, sample dates oct 23-30, 2013
economy revenue ticket: $946 + $344 in taxes = $1,290
economy reward ticket: 75k miles + 344 in taxes.
by booking a reward ticket, you use 75k miles to save $946, which is a return of 1.26c per point.
miles not earned due to using a reward ticket: 6,378 (status miles)

business revenue ticket: $5234 + $344 in taxes = $5,578
business revenue ticket: 125k points + $344 in taxes (note: you connect via PEK)
by booking a reward ticket, you use 125k points to save $5,234, which is a return of 4.19c per point.
miles not earned due to using a reward ticket: 15,893 (status miles)

the domestic traveler on air canada:
route: YVR-YYZ, sample dates oct 23-30, 2013
economy revenue ticket: $418 + $133 in taxes = $551
economy reward ticket: 25k miles + $152 in taxes. (they charge an extra fuel surcharge!)
by booking a reward ticket, you use 25k miles to save $399, which is a return of 1.60c per point.
miles not earned due to using a reward ticket: 1,038 (non-status miles)

business revenue ticket: $2,946 + $260 in taxes = $3,206
business revenue ticket: 50k points + $152 in taxes
by booking a reward ticket, you use 50k points to save $3,054, which is a return of 6.11c per point.miles not earned due to using a reward ticket: 6,231 (status miles)

overall rates of return
from the comparison here, for domestic travel, one can get 1.26 to 1.60 cents per point. for business travel, one can get 4.19 to 6.11 cents per point. the value for the business redemption is slightly inflated because it assumes that you would be willing to pay that much to fly business. i'm not sure if i would pay $5,578 to book a business ticket to hong kong. these redemption rates are also assuming that you can actually book a ticket. if you're unable to find/book the ticket that you want, then it brings the rate of return to a disappointing 0 cents per point.

implications for mileage reward cards:
the vast majority of mileage reward cards have a $120 fee. there are some exceptions (bank of america's alaska airlines = $75, royal bank's cathay pacific card = $150). if you earned 24,000 points per year from the card, each point that you have earned cost 0.5c per point due to the annual fee. if you earned 36,000 points, that cost per point earned drops to 0.33c. so you would need to readjust the value per point by subtracting the cost per point earned from the potential value of each point.

when is it best to use a mileage reward card?
if you're planning on using it only for domestic travel, it's best to use the capital one aspire travel world mastercard or something that gives you 2% return. if you're planning on doing business travel, and are willing to hunt for business seat availability, then by far, the mileage reward cards are the way to go. even if you halve the cost that you were willing to pay for a business class ticket, the potential rate of return would still be 2.09% to 3.05% -- values much better than the simple cash back cards.

(note: if you choose to apply for the capital one aspire travel world mastercard, book through great canadian rebates to get an additional $30 rebate via paypal).

credit cards: cash back comparison

i'm still in that transition between idolizing the frequent flyer miles and the cash back credit cards. at the end of the day, i try to figure out which card would get me the best rate of return possible.

my baseline cashback card is capital one aspire cash card. it provides a 1% return and a 50% bonus yearly. this means an effective return rate of 1.5%. there's no annual fee, there's extended warranty, purchase protection, travel medical, cancellation, interruption, and car rental insurance. it's a very strong insurance package. there's no annual fee. (if you apply for this card, make sure you sign up for the card, make sure you use the link via great canadian rebates for an additional 30$ bonus sign up credit).

something a bit better is the capital one aspire travel world mastercard. while it has a $120 annual fee, you get $100 a year back in points. this makes the effective annual fee of 20$. you get 2% back that can be used against the purchase of travel (provided the travel purchase is $600 a more). it has all of the insurances as the aspire cash card. compared to the capital one aspire cash card, you would then need to spend $4,000 in order to break even with the annual fee. that is to say, after spending $4,000 a year, that extra 0.5% return will mean earning an extra $20, enough to cover the annual fee. (again, using great canadian rebates, you can get an additional sign up bonus).

so all other cards have to beat a 2% return rate (assuming you spend more than $4,000 a year).

the raw data:
1% or less:

• PC financial = 1% return in groceries 
• TD no fee cash back = 1% return
• other TD annual fee credit cards = 1% in travel  
• CIBC no fee cash back = up to 1% in cash
• Scotia no fee momentum = 1% return 
• BMO no fee cash back = 0.5%

1% -1.5% return:

• BMO $79 cash back card = 1.25%
• TD $120 annual fee first class visa = 1.5% in travel 
• CIBC $79 annual fee cash back = 2% only on purchases above $50,000 per year
• Chase financial cards with no forex fees = 1% - 1.5% return 
• National bank -- all cards = 1-1.67 points per dollar, 1 pt = 0.91c, so 0.91 - 1.52%
• 1.67 point/$ card carries an annual fee of $125 and assumes a max spend of $30k/yr

1% regular + 2% or more for special categories:

• RBC no annual fee cash back = 1% regular purchases, 2% groceries
• could make sense to combine the aspire one cash back card with this card to use specifically for groceries 
• MBNA smartcash = 1% regular purchases, 2% gas and groceries capped to $400 a month
• Scotia $39 momentum = 1% regular purchases, 2% groceries

2%+ crowd:

• MBNA world points mastercard = 2% return on all purchases, no annual fee. however, this card is no longer being issued, previous holders are grandfathered.

can we increase the rate of return beyond 2%?
if you're willing to use a high-annual fee card in combination with either the aspire travel card, you can possibly get a better rate of return:

• Scotia infinite momentum: 1% regular, 2% drug and recurring payments, 4% gas and groceries. $99 annual fee.
• if you use this card for only your gas/groceries, and leave all of the other spending on your 2.0% aspire travel card, you'd need to spend $4,900 on those categories in order to break even with the annual fee. any additional spending will increase your overall rate of return.
• Scotia bank gold american express  = 4% for gas/grocery/dining/entertainment, and 1% for all else. rebate can only be used for travel in the future.
• given its $99 annual fee, like the scotia infinite momentum above, one would need to spend roughly $4,900 in these categories to break even with the annual fee. the benefit of this card is that there are additional categories to get bonus spending. however, the downside is that amex is not accepted.

conclusion:
if you're willing to pull out the right card for the right type of merchant, you could end up with a rate of return greater than 1.5% (provided a minimum spend of $4,000 a year on the aspire card and $4,900 on the gold amex).

my current card strategy:

1. gas/dining/grocery/entertainment: scotia bank gold amex for 4% return
2. all other purchases, and non-amex merchants: MBNA world points master card for 2% return
3. all foreign transactions: sears financial mastercard for 1% return and no forex fees
• for foreign gas/dining/grocery/entertainment charges, i will probably use the amex because the 4% return outweighs the 1% sears return + 2.5% forex savings 

credit cards without a 2.5% foreign conversion fee

update: sears no longer transfers to petro-points, so my new recommendation is the amazon.ca rewards visa.

most credit card companies in canada charge an extra fee for making purchases in non-canadian dollars. typically, this amounts to 2.50% of the purchase price. so if something were to cost an equivalent of 100$ cad, you'd end up paying 102.50$. this becomes tricky when using your rewards-based credit card. if your original rate of return was just 2%, then after the foreign conversion fee, you'd end up with a net loss of benefit. this charge is usually built into the exchange rate that you see.

the solution to this is having a no-forex credit card. in the states, there are lots floating around. i'm sure there are lots floating around in canada too, being offered by the various credit unions in canada. chase canada, however, has consistently removed the forex fees among most of its card offerings. so if you would normally pay a 2.50% fee using your rewards credit card, then by using a no-forex fee card, your immediate return would be 2.50% -- not bad!

here are a list of cards they have that do not have a foreign exchange fee:

1) best buy rewardzone visa: very, very limited program. 1 point per 1$ spent, 400 points = 5$ reward certificate for best buy. this is equivalent to a 1.25% return per dollar spent at regular merchants, or 2.5% return per dollar spent at best buy. no annual fee.

2) amazon.ca rewards visa: more versatile than the best buy rewardzone visa, you receive 1% straight cash back on all purchases, or 2% back on purchases from amazon.ca. no annual fee.

  

3) marriott rewards visa: this carries a hefty 120$ annual fee, although the first year is waived. this is made up for, however, by the free category 1-4 hotel night stay that you receive each year for having the card. (note, a hotel in downtown seattle is a category 5, so i can only imagine hotels in more or equally desirable cities would be at a higher category). 

you receive 1 point per dollar spent on regular purchases, 2 points per dollar on airline tickets, car rental, or restaurants, and 5 points per dollar spent at marriott purchases. a category 5 hotel (e.g., in seattle), costs 25,000 points per night, or 20,000 points per night if you book 5 nights. using a category 5 hotel, in this instance, courtyard seattle downtown/lake union, for a random date (june 8-9) would cost 243.60$. mind you, this is for their advertised rate -- whether you would actually pay nearly 250$/night in seattle is a different story altogether. at best, each point is worth roughly $0.01. for most purchases, this card would give you a 1% return.

probably more importantly about this card is that it gives you a credit for 15 nights a year in the marriott rewards program. this automatically vaults one into their silver status, meaning that in order to get gold status, one only needs an additional 35 nights a year rather than 50. 

4) sears financial mastercard (no annual fee) / voyage mastercard (39$ annual fee): the no annual fee version is the one that i carry. 1$ spent = 1 point spent. you'll get twice the points for sears purchases, and on the voyage mastercard, you'll get three times the points for travel purchases. what i like most about the card is its versatility. 1000 points = 10$ at sears, meaning a 1% return on most purchases. 

if you don't want to shop at sears, you can convert these points. that is the best feature of it all. 1,000 sears points = 12,000 petro points. 12,000 petro points can be used to pay for 12$ worth of travel. following this logic, each 1$ spent on the card at regular merchants gives you a 1.2% return on travel. still not enough? 12,000 petro points can then be exchanged for 1,200 cathay pacific asia miles. so in reality, 1$ spent on the card gives you 1.2 asia miles on cathay pacific (better, really, than CIBC aerogold, for example). that is the real benefit of this card.

and all of this is on top of the 2.5% "savings" you get with the foreign exchange fee waived. note, however, that none of these cards offer extra insurances, such as purchase protection or extended warranty. only the marriott visa gives car rental insurance, but nothing else. something else to consider.

my strategy:

1) use my MBNA 2% cash back card at almost merchants in canada

2) test out my scotiabank gold amex at gas/grocery/dining/entertainment for 4% cash back

3) use my sears financial mastercard for all my international spending needs.