Personal Finance

Aeroplan vs Cashback Credit Card, what's better value?

  • Last Updated:
  • Oct 5th, 2021 10:59 am
[OP]
Newbie
Jun 25, 2019
5 posts

Aeroplan vs Cashback Credit Card, what's better value?

Hey all, my wife and I finally got our Permanent Residency (!) so we are on the hunt for a bank (physical or online) that offers the best value in rewards which will eventually go to flights between Australia and Canada. We are both Aeroplan members with a family account and will usually fly Air Canada or a partner airline, so flying will also net us further Aeroplan points.

We've done a lot of research, but are confused what would provide the best value between getting an Aeroplan credit card (TD or CIBC), a cash-back credit card (and put the cash-back towards a future flight), or another points-style card that can eventually be transferred to Aeroplan points, we are open to all options.

We would only be eligible for the basic Aeroplan cards from TD/CIBC with 1 point per $1, and with cashback cards only 2% due to our household income of around $90,000 and good/great credit scores.

Another big thing for us is having a joint savings/chequing which we both get paid into, and joint credit cards (preferably both earning us a credit rating, but could also accept wife just being a secondary card holder) so we can pool spending and earn points/cash-back faster.

What do you recommend?
14 replies
Deal Fanatic
User avatar
Jan 16, 2011
7173 posts
9144 upvotes
The NORTH
Both TD & CIBC offer pretty good deals for their Aeroplan Visa Infinite cards. However, if you want the best card to get Aeroplan miles, it's actually an AMEX. Starting August 16, you can convert AMEX MR points earned on the AMEX Cobalt to Aeroplan at 1:1 ratio.

With the AMEX Cobalt, you get: 5x on food, 3x on select streaming, 2x on travel, gas & transit, 1x on everything else.

Monthly fee: $10/month if you sign up before August 16, it's $12.99/month (2nd year onwards or signup on or after August 16).

If you're a current AMEX cardholder in Australia, you can use AMEX's Global Transfer to use your Australian credit history to open an AMEX card here in Canada.

https://www.americanexpress.com/global- ... ndex.shtml

What I'd do would be to get that and then pair it with a nice Visa/MasterCard for times when you can't spend on an AMEX. Depending on your spend, something like the CIBC Dividend Platinum Visa if you go with CIBC for your banking needs makes a great companion for that AMEX card or for a free card, their basic CIBC Dividend card ain't bad either.

Now, if you don't qualify for the AMEX card, both the CIBC & TD basic Aeroplan cards are kinda crappy. I'd go with the CIBC basic over the TD basic Aeroplan because the CIBC one has no annual fees. I'd recommend seeing if CIBC & TD is willing to give you their more premium versions of the card seeing that your income is pretty close to requirements.

EDIT : I twisted someone's knicker apparently. I found this answer on Reddit as the OP copied the same question here and there.
Last edited by kr0zet on Aug 15th, 2021 9:10 am, edited 1 time in total.
Deal Guru
Dec 5, 2006
13028 posts
8269 upvotes
Markham
DomC22676 wrote: Hey all, my wife and I finally got our Permanent Residency (!) so we are on the hunt for a bank (physical or online) that offers the best value in rewards which will eventually go to flights between Australia and Canada. We are both Aeroplan members with a family account and will usually fly Air Canada or a partner airline, so flying will also net us further Aeroplan points.

We've done a lot of research, but are confused what would provide the best value between getting an Aeroplan credit card (TD or CIBC), a cash-back credit card (and put the cash-back towards a future flight), or another points-style card that can eventually be transferred to Aeroplan points, we are open to all options.

We would only be eligible for the basic Aeroplan cards from TD/CIBC with 1 point per $1, and with cashback cards only 2% due to our household income of around $90,000 and good/great credit scores.

Another big thing for us is having a joint savings/chequing which we both get paid into, and joint credit cards (preferably both earning us a credit rating, but could also accept wife just being a secondary card holder) so we can pool spending and earn points/cash-back faster.

What do you recommend?
Congratulations for PR, big achievement

Regarding card, don't just look at cash back vs aeroplan first

You should first look at your spending pattern and see which card is best fit. Fee or no fee? Point vs cash back. You can pay for the flight and redeem for other rewards and still better off overall
Sr. Member
Feb 28, 2014
964 posts
1141 upvotes
kr0zet wrote: Both TD & CIBC offer pretty good deals for their Aeroplan Visa Infinite cards. However, if you want the best card to get Aeroplan miles, it's actually an AMEX. Starting August 16, you can convert AMEX MR points earned on the AMEX Cobalt to Aeroplan at 1:1 ratio.

With the AMEX Cobalt, you get: 5x on food, 3x on select streaming, 2x on travel, gas & transit, 1x on everything else.

Monthly fee: $10/month if you sign up before August 16, it's $12.99/month (2nd year onwards or signup on or after August 16).

If you're a current AMEX cardholder in Australia, you can use AMEX's Global Transfer to use your Australian credit history to open an AMEX card here in Canada.

https://www.americanexpress.com/global- ... ndex.shtml

What I'd do would be to get that and then pair it with a nice Visa/MasterCard for times when you can't spend on an AMEX. Depending on your spend, something like the CIBC Dividend Platinum Visa if you go with CIBC for your banking needs makes a great companion for that AMEX card or for a free card, their basic CIBC Dividend card ain't bad either.

Now, if you don't qualify for the AMEX card, both the CIBC & TD basic Aeroplan cards are kinda crappy. I'd go with the CIBC basic over the TD basic Aeroplan because the CIBC one has no annual fees. I'd recommend seeing if CIBC & TD is willing to give you their more premium versions of the card seeing that your income is pretty close to requirements.
Way to plagiarize my response word for word from Reddit when OP asked the same question on PFC.

https://www.reddit.com/r/PersonalFinanc ... er/h8yvxbp

At least if you were gonna copy my words, at least attribute your source.

---

Proof that I wrote this originally: https://www.reddit.com/r/PersonalFinanc ... yvxbp.json
In the JSON file, the created_utc for my reply is: 1628983583 which is the UNIX epoc timestamp. Converted to EDT it is: Saturday, August 14, 2021 7:26:23 PM which was almost half an hour before kr0zet plagiarized my post.
Deal Fanatic
User avatar
Jan 16, 2011
7173 posts
9144 upvotes
The NORTH
deltatux wrote: Way to plagiarize my response word for word from Reddit when OP asked the same question on PFC.

https://www.reddit.com/r/PersonalFinanc ... er/h8yvxbp

At least if you were gonna copy my words, at least attribute your source.

---

Proof that I wrote this originally: https://www.reddit.com/r/PersonalFinanc ... yvxbp.json
In the JSON file, the created_utc for my reply is: 1628983583 which is the UNIX epoc timestamp. Converted to EDT it is: Saturday, August 14, 2021 7:26:23 PM which was almost half an hour before kr0zet plagiarized my post.

I found a response for the exact question on reddit.
Last edited by kr0zet on Aug 16th, 2021 4:42 pm, edited 2 times in total.
[OP]
Newbie
Jun 25, 2019
5 posts
The cobalt amex sounds great, I tried calling but their office is closed and I want to decide today as the price hikes up tomorrow.
Can we do our entire banking with amex (using cobalt credit card, get paid from our work into a 'joint' amex chequing/savings account)?

If we can also open a chequing and savings account with amex, does this incur fees?
If all we can do is sign up for a cobalt card, how do you pay off the credit card?
And if we still want a visa for when amex isn't accepted, do we have to keep a CIBC credit card account for those transactions?
Sr. Member
Feb 28, 2014
964 posts
1141 upvotes
DomC22676 wrote: The cobalt amex sounds great, I tried calling but their office is closed and I want to decide today as the price hikes up tomorrow.
Can we do our entire banking with amex (using cobalt credit card, get paid from our work into a 'joint' amex chequing/savings account)?

If we can also open a chequing and savings account with amex, does this incur fees?
If all we can do is sign up for a cobalt card, how do you pay off the credit card?
And if we still want a visa for when amex isn't accepted, do we have to keep a CIBC credit card account for those transactions?
Here's my response to your question originally posted on PFC: https://www.reddit.com/r/PersonalFinanc ... er/h93iv92
Deal Expert
User avatar
Jan 9, 2011
15227 posts
20496 upvotes
Vancouver
DomC22676 wrote: The cobalt amex sounds great, I tried calling but their office is closed and I want to decide today as the price hikes up tomorrow.
Can we do our entire banking with amex (using cobalt credit card, get paid from our work into a 'joint' amex chequing/savings account)?

If we can also open a chequing and savings account with amex, does this incur fees?
If all we can do is sign up for a cobalt card, how do you pay off the credit card?
And if we still want a visa for when amex isn't accepted, do we have to keep a CIBC credit card account for those transactions?
Amex does not offer deposit accounts. Credit products only.
You can set up automatic payment of your Amex card from any bank account, on the Amex website.
Get Cobalt, it’s a killer card.
[OP]
Newbie
Jun 25, 2019
5 posts
I went with the cobalt seems like a killer deal as everyone as said, I signed up before the rate increased today hopefully it gets approved!
Newbie
Oct 16, 2020
54 posts
44 upvotes
A classic answer between "travel rewards vs cash back" cards is that it depends on your spend and usage.

So I'll just offer up some considerations that affected my decision (I ended up going with cashback over Aeroplan).

- There are some solid cashback cards which have no annual fee, which I preferred. Yes there are better cards for a modest annual fee where you might end up ahead based on your estimated spend/usage categories. But I like the idea of no AF, so any cashback is "100% gravy", and I don't have any pressure at all to "keep up my spending" to a level where I'm above the "breakeven" with an annual fee card. Spending patterns can change, financial situations can change... I'm ok not potentially maximizing cashback with an AF card, to still get "good enough cash back" while not having any downside with a no-AF card
- Aeroplan / travel rewards tend to get best bang for buck / value when you book long-haul Business Class or better. On a pure percentage basis. But that means you often have to save up rewards points for quite awhile, which is true even if you're doing long-haul economy class, just to a lesser degree. Said another way, the reward redemptions are "lumpy" - you get them once every couple years potentially?
- Aeroplan miles (and other travel rewards) tend to depreciate in value over time (ie. airlines increase mile redemption requirements, put in other restrictions that slowly reduce value per mile). This, coupled with the point above that it can take some time to get enough points to redeem, can make it so it can take even longer than you initially predicted to redeem
- Aeroplan specifically has just been revamped with a fairly new system (Air Canada re-acquired Aeroplan so it's now all in-house Air Canada again). It remains to be seen how favorable / unfavorable they will make their program, as travel just starts to open up again and airlines are coming off some pretty tough days, financially

I think there are some ppl in certain seasons of life, where a travel card (like Aeroplan) is better value (and for you and your wife, if you'll be going back to Australia frequently, maybe your'e one of them). For my personal season of life (traveling less, have 2 young kids), I prefer the zero-downside no annual fee cashback card, where I can redeem in relatively shorter intervals / at any given time.
Deal Addict
Sep 5, 2005
1636 posts
2374 upvotes
Victoria
kr0zet wrote: I found a response for the exact question on reddit.
Why didn't you attribute the source or link to it?

OP, I find a lot of value in Aeroplan for long-haul business class flights or short haul cash expensive routes.
The return is worth well more than any cashback card if you would use those.
If not, then cash back may be the way to go.
Deal Addict
User avatar
Dec 17, 2008
2774 posts
2235 upvotes
Winnipeg
deltatux wrote: Way to plagiarize my response word for word from Reddit when OP asked the same question on PFC.

https://www.reddit.com/r/PersonalFinanc ... er/h8yvxbp

At least if you were gonna copy my words, at least attribute your source.

---

Proof that I wrote this originally: https://www.reddit.com/r/PersonalFinanc ... yvxbp.json
In the JSON file, the created_utc for my reply is: 1628983583 which is the UNIX epoc timestamp. Converted to EDT it is: Saturday, August 14, 2021 7:26:23 PM which was almost half an hour before kr0zet plagiarized my post.
It's the internet - nobody follows the rules and there really isn't anything you can do about. Unfortunately, that is the reality.
I have had the exact same thing happen when I post on RFD and then I find it copied word for word on highinterestsavings.ca - It was annoying but I got over it. :)

Back to the topic at hand, I have both the AMEX Aeroplan and the CIBC Aeroplan infinite (free for first year), based on this thread it would be better for me to keep the AMEX if I am understanding correctly?
*Do you like someone's idea, post, or response? Why not consider giving them "thanks" and clicking the thumbs up to give them the credit they deserve.*
Member
Aug 20, 2019
310 posts
200 upvotes
Shawguy wrote: It's the internet - nobody follows the rules and there really isn't anything you can do about. Unfortunately, that is the reality.
I have had the exact same thing happen when I post on RFD and then I find it copied word for word on highinterestsavings.ca - It was annoying but I got over it. :)

Back to the topic at hand, I have both the AMEX Aeroplan and the CIBC Aeroplan infinite (free for first year), based on this thread it would be better for me to keep the AMEX if I am understanding correctly?
Cobalt from AMEX, theirs Aeroplan one is a disaster to say the least, an horrid product, the worst of the 3 core Aeroplan’s CC where you don’t even get a single day of travel medical coverage.
Deal Expert
User avatar
Dec 11, 2005
19819 posts
2579 upvotes
It depends a lot on how you value Aeroplan points.

The value that a lot of folks agree upon for Aeroplan points is around 1.9 cents - 2.1 cents / point. This puts cards that earn 1 point / dollar or higher, a very good value.

This however. is based on certain types of redemptions... namely, long distance / high-value (ie. transatlantic or transcontinental) flights or upgrades. If you are never going to make those kinds of flights though, then your end value might end up being significantly less. Especially during the past two years, a lot of people are banking a crapton of points because no one is travelling. After the pandemic is over there is going to be a lot of competition and demand for reward seats and the value of points might drop through the floor. Yes, points do change in value based on demand for flights. If you end up using them as cash, they are only worth 1 cent.

The nice thing about a, say 1.5% cash back card is it is straight up cash... no risk, always valuable. You don't need to take certain types of flights to get the value. Also you get the value a lot faster and don't need to save up points for a year or longer.

So, it is a tradeoff and you really need to look at your own circumstances.
To be nobody but yourself - in a world which is doing its best, night and day, to make you everybody else - means to fight the hardest battle which any human being can fight; and never stop fighting. -- E. E. Cummings
Member
May 29, 2019
223 posts
200 upvotes
I wouldn't be going to that dystopian mess/police state anytime soon. However, you'll probably save more with an Aeroplan card. If you only qualify for cards that are $1 = 1 point I'd probably go with a cash back card though. I use the Amex Simply Cash Preferred. It's 2% on every single purchase, no categories, no fuss. You can apply through GCR and get your first year free ($99/year). Also, I believe the first 4 months is 10% back now, so you can really stand to earn a lot back fast. Not to mention Amex offers which save me in the range of $100-$200 a year as well in instant credits once a transaction posts. If you do go cash back, I'd highly recommend this card.

Top