Tag Archives: Aeroplan

A Heads-Up If You Have Aeroplan Points

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Air Canada’s Aeroplan program has made a massive change in the program that a number of people have realized the hard way!

If you haven’t had any activity (earning or redemption) in an 18-month period your points will be wiped out and gone. I want to hope that this massive change notice went to their customers, but I didn’t get it or perhaps didn’t see it.

If you’ve listened to me for any length of time, you’ve heard me point out that any points program is like bananas and not a savings account! Their value diminishes, the redemption thresholds increase and they may expire. Well – here we are!

If you know it’s been more than 18-months, you’re out of luck. If you’re not sure, log in (or set up online access) with your Aeroplan number and have a look. If they’re still there, check your transaction history. TODAY would be good! If you’re within a couple of months of losing your points, you’ll need to at least earn one point to trigger another 18-month cycle.

Unfortunately, that may be harder than you think. Sure you can earn points on Air Canada activity, but anywhere else gets harder if you need a few points quickly! I sent to people to the Bay and/or Sport Check – turns out that neither takes Aeroplan. Yes, it’s still shown on the website but that’s not the case. You can try Starbucks but it requires you to set up the app and link it.

Two other options: If your birthday month just happened, or is close, you’ll get an email with a promotion. Select the few points (vs. a flight discount) to get the points quickly. Or go to the site and buy something on the overpriced retail stuff. Maybe you can find a $20 gift card of some kind. After all, a transaction is a transaction. Just don’t wait too long!

Update March 26 2024: It appears that Chevron has signed up to accept Aeroplan points. If so, you may just need to detour to them for a tank of gas using your Aeroplan card in order to keep your points alive. Nice to find with more retailers cancelling than joining! As of right now, it’s the only national chain that I’m aware of…

Aeroplan Sale & Cell Phone Sales

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A new update on Aeroplan for the five million of us Canadians who are in the program. It turns out that your points won’t likely depreciate in value, and you won’t need to have them all cashed out next year.

The re-purchase of Aeroplan was finalized yesterday. $450 million price and assuming the ($1.9 billion) points liability the (outstanding points IF they’re all claimed…and less than 70% will be, according to Consumer Report studies). But Air Canada received $622 million from TD and another $308 million for future points. CIBC also has a card that gives you Aeroplan miles, so they kicked in $200 million and another $92 million for future points. Right now, they’re still negotiating with Amex to continue with Aeroplan.

So Air Canada paid $450 million and received over $1.2 billion. As of the purchase date, they got the whole company AND made $772 yesterday. There’ll now be a lot of competition with PC Optimum and  Esso Extra points for your business. Those two are almost immediate gratification points. A month after I signed up for Esso Extra I had a free carwash already. Aeroplan miles are more dream rewards for the long term in hoping there’ll be enough points someday way down the road for a trip to Europe.

Right after last Wednesday’s segment, the Dow dropped 660 points and this time it wasn’t President Trump’s fault, but ours. It was started by Apple announcing that iPhone sales were way down. Yesterday, Samsung announced the same thing with a 22% drop in sales.

In the U.S., as we discussed last year, there are no more two or three-year locked-in plans with a so-called free phone. You need to pay for the phone and then get a month-to-month plan. It’s increased customer satisfaction with carriers a ton and reduces your cell bill by a lot. No more being locked in for two or three years and having the almost spit on you when it comes to customer service. However, if you need to buy your phone and can’t pretend it’s ‘free’ any longer, you’ll shop around more ,and will keep your old phone an extra year or two. That’s why Apple and Samsung stock has been way down, due to less sales volume. Apple was a trillion dollar company last fall – now they’re down 40% in stock values.

It’s also why Apple started discounting the price of their phones last month! If you can’t pretend it’s ‘free,’ a thousand dollar phone is quite the shock. You can also now get an Android for under $300 and apparently the Nokia 7-1 is really inexpensive and a great phone! That trend will continue with better phones at a much lower price, and the no-contract plans will come to Canada sometime soon – so don’t be stuck in a new two or three year contract. And avoid the big marketing starting soon on 5 G phones. It’s a much faster network – way faster than your home internet. But it’ll be three years before you’ll actually have the network to use it.

Update from first January segment to try some simply your life and get rid of 100 things:

I tried the Japanese method of decluttering where you hold something in your hands and if it doesn’t bring you joy, you throw it away. So far, I’ve thrown out all vegetables, my Amex bill, the scale and a mirror!

George Boelcke – Money Tools & Rules book – yourmoneybook.com

Loyalty is Dead: This Time it’s Aeroplan

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We talked last year about loyalty programs. On average we’re in a dozen programs and active in about eight.

But, if you’ve noticed, almost all of them aren’t loyal to you. Their way of getting points, freebies, dollars, or whatever are harder to get, PLUS the redemptions keep getting further and further away from happening. It’s more of a game that you’re going to lose beyond a free toaster or something minor. Yet, we’re hooked and stay loyal, despite all the evidence that we’re not getting much of a reward for it – and often for overpaying when another company is often cheaper to deal with.

The newest is a twist where the company who wants your business isn’t even loyal to their loyalty company! If you remember back, it wasn’t that long ago that Air Canada was on the verge of bankruptcy. At that time, they sold their frequent flyer miles program for some big money.

Aimia is the company that owns and runs the Aeroplan frequent flyer loyalty program. They also manage those of Nordstrom, and other companies from Europe to the Middle East.

They have five million of us Canadians as members who hold over 200 billion miles. The company itself, buys 700 million dollars of tickets from Air Canada a year. But now Air Canada is dumping the company that bailed them out to start their own loyalty program again. Needless to say, the stock was down over 76% after the announcement.

Aeroplan is done as of 2020. So the five million of us will start to get greatly reduced rewards. After all, what’s Aimia’s reason for keeping us excited when Air Canada is yanking us away from the program. By the end of next year, there’s no point chasing points that you’re not likely to get any benefit from. On my to-do list is to cash them all out by next year. I normally get Esso gift cards as they can turn into real cash when I gas up. Most other things are pretty marked up in value, so be careful before you press the “redeem” button. If you’re close to an airline ticket, book it as soon as you can before the points needed goes up again and again. If you’re not close – I’d recommend you don’t start the chase.

The World of Reward Points Is Changing

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The average Canadian has five reward programs of one kind or another. It might be a 10th free haircut, frequent flyer miles, 10% off if you spend over a certain amount, or rewards on your credit card.

Whatever you’ve figured out about them will be all different in the next few years. In short, the programs will be converting from volume to profitability and the opposite for credit card rewards. Right now, you’re getting rewards on your visits or spending totals. Down the road it’ll be whether you buy something profitable. No more points (or very few) to buy something at a discount, but now big rewards when you buy something way overpriced or at full retail price.

In the airline business, Air Canada has done three quiet changes to their reward programs already. Cheap seat-sale tickets now get you 25% of the miles versus full price so-called Flex tickets. Delta Airlines is already the process of fully converting their frequent flyer program. If you collect miles you need to know this. It will become the norm with every other airline. You’ll no longer earn miles based on distance flown, but on the amount you spent. It’s turning frequent flyer programs upside down. So, a last minute ticket to Vancouver at a big price will get you more miles than a discount flight to Europe.

The programs will be based on your profitability with the airline. If you make them a ton of profit – you’ll get a ton of miles. The biggest losers will be those of us who are price sensitive and bargain shop for flights. In the next few months I’m cashing out all my miles for gift cards or cash – better safe than sorry. When this comes to other airlines, you’ll be way better off getting a points reward card that lets you accumulate points for gas and other purchases – you’ll end up getting a lot more rewards than from an airline!

In the credit card world, the change will be to quantity of transactions. American Express has now introduced a new credit card that will increase your reward points by 20% once you reach 20 transactions in a month. For Amex that makes sense because their average client spends four times as much per transaction, and has a much higher average income. It’s just maximizing their transaction fees.

There was a recent study that found over a third of all reward programs are never claimed. In the airline world, according to Consumer Report, over 75% of miles are never claimed. Stop chasing and start cashing out. You won’t be a prisoner to one company or another and will become a free agent that can get the best deal from any company. I’ve started cashing out my Aeroplan miles by getting $2,000 in Esso gift cards. Check what you can redeem for the least amount of points or miles. With Aeroplan, chasing a free ticket can be a fools game. Gift cards tend to be a good deal on redemptions. Amex gift cards cost 7500 points for a $50 card whereas the Esso gift cards cost me 6500 points each.

The Fine Print Of Reward Credit Cards

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A few months ago we talked about CIBC’s switch from their Aeroplan card to their own Aventura card. CIBC wants a card that can be used for any travel, instead of just Aeroplan points. It’s likely you’ve seen the cute penguin commercials as their $50 million launch campaign is well on the way.

Since I’m likely the only person to ever read the fine print of credit card disclosure, I wanted to highlight some of it for you. The disclosure on this card is 8.5 size font and over 3,000 words. That’s what makes me pretty sure I’m one of the few people to read it. This is from the Aventura card, but the fine print is pretty standard for all cards and the details and traps of the perks are roughly the same for every reward card.

You’ll earn one point for every dollar you spend on the card. So if you want a travel reward that’ll take 50,000 points, get ready to charge $50,000 on the card!

The card has a $120 annual fee and a 20% interest rate. That’s pretty much the same as others. So make sure you only get this type of card if you’re always paying off the balance in full. If you often carry a balance, a 12% card with no annual fee will put you light with no annual fee will put you miles ahead of trying to chase points and paying interest AND the annual fee! In other words, the saving on interest and no fee is money you can use to buy your own travel at less cost.

Travel cards generally advertise that you can fly anywhere and anytime with no restrictions of any kind. Well – not quite. The fine print states that ‘flights are not available at the lowest point level to all destinations, or at all departure times. So you thought it’d take you 25,000 points to fly to London. When you go to look or book it may turn out that the point level to get there is actually 50,000 and…well, you’re not going anywhere. You also need to remember that the points required can be increased at any time without notice. It’s in section 34…if anyone gets that far in the disclosure.

If you’re close, the card lets you buy up to 20% of the points you’re short. The cost is 3 cents per point. But that’s only if you’re close to getting the travel reward you were working towards. Using your points is at 2 cents per dollar.

If you’re not up to date in your payments one month, it’s not likely you’ll get the points for that month. If you get tired of paying the annual fee and close the account, you have 60-days to redeem your points or they’re wiped out. If the card issuer closes the card out from under you, you lose all the points immediately.

Starting to see why Consumer Report found that 75% of airline reward miles never get used? Before you sign up for any annual fee travel card, stop and do 30 seconds of math:

How many points will you need to go where you want to go?

How much do you charge on the card per month?

If you need 50,000 points and charge $1,000 a month or so, it’ll be 50 months before you have enough points. That’s the 5th year. Plus, it’s assuming the point level never increase in those five years, which is pretty small odds. So you’ll pay $120 annual fee times five years, which is $600. Do the math: Are you sure it wouldn’t be cheaper to pay cash?