Reward points bonanza? Not quite for cross-border shoppers

TORONTO -- The low loonie hasn't been kind to Canadians. Groceries cost more, unemployment is creeping up and domestic investments are underperforming.

See Full Article

But amid all the bad news, credit card rewards collectors can take some relief in earning more points than before when spending money or shopping in the U.S., even though it isn't exactly the perfect time to go on a cross-border shopping spree in a bid to horde extra points.

"In the long run ... you're making less in points than you were before because you're spending a lot more cash up front," said Patrick Sojka, founder of Rewards Canada.

The Canadian dollar dipped below 70 cents US last week and is hovering just under 69 cents this week.

Canadians purchasing U.S. goods online or across the border now pay a roughly 30 per cent premium. But they're also earning 30 per cent more points when paying with a credit card that offers rewards based on total dollars spent.

So if a product cost US$100 when the two currencies were close to being on par, Canadian shoppers earned roughly 100 points, depending on their card's policy. Now that product earns Canadians roughly 135 points, said Sojka.

Another apparent bonus? Canadians need to spend less in the U.S. than Americans to earn the same number of points, said Avery Campbell, the founder of Awarding Canada, a business that helps Canadians make the most of their travel rewards.

Assuming both nationalities use the same credit card that offers one point per dollar spent, Americans need to buy something worth US$100 to earn 100 points, he said, while Canadians can earn the same amount on a roughly US$70 bill.

While those things may seem good at first glance, the extra points aren't exactly a steal.

"It is worse because you are spending more money," said Campbell. "Your purchasing power is lower."

Canadians have to spend more money on items that once cost them less to earn those extra points, Sojka said.

While that is true, they may be able to book flights with fewer points than normally required thanks to the low loonie.

As purse strings tighten, Canadians seem loathe to travel as much as usual, said Sojka, especially to the U.S.

That makes Aeroplan's market fares, which are based on real-time flight prices, a deal on certain routes.

He recently tried to book a trip for four from Calgary to Hawaii, which typically requires 180,000 miles in economy, according to the company's fixed mileage rewards chart. He snagged the flights for 9,000 miles less through the market fare option.

"That's where Canadian points will become a greater value is on these sort of flights."



Advertisements

Latest Economic News

  • Montreal's Oreo cookie plant prepares to shut its doors

    Economic CTV News
    MONTREAL -- There was a time when the whole neighbourhood surrounding an east-end Montreal bakery would smell like baking Oreos. But that era comes to an end this month when snack-maker Mondelez International closes its Montreal factory for good. Source
  • Oilsands tech touted for pipeline capacity boost still years from deployment

    Economic CBC News
    Two years after a blue-ribbon panel called on the Alberta government to encourage partial upgrading of bitumen from the oilsands to enhance value and free up more pipeline room for exports, the idea remains years away from commercialization. Source
  • Nunavut lagging behind in ramp-up to marijuana legislation

    Economic CTV News
    IQALUIT, Nunavut -- With marijuana legalization only months away, members of Nunavut's new government are finally discussing how the territory will handle the change. "We do feel behind in our preparation," said Dan Carlson, Nunavut's deputy minister of finance. Source
  • Bitumen upgrade still years away for Alberta oilsands

    Economic CTV News
    CALGARY -- Two years after a blue-ribbon panel called on the Alberta government to encourage partial upgrading of bitumen from the oilsands to enhance value and free up more pipeline room for exports, the idea remains years away from commercialization. Source
  • Opposition grows to Bell, Rogers-backed plan to block piracy websites

    Economic CBC News
    Opposition is mounting to a media coalition's plan to block Canadians from accessing piracy websites. Many people fear that the plan — backed by big players such as Bell, Rogers, and CBC — could lead to rampant internet censorship. Source
  • Landline phone scam and luxury car purchases: CBC's Marketplace consumer cheat sheet

    Economic CBC News
    Miss something this week? Don't panic. CBC's Marketplace rounds up the consumer and health news you need. Want this in your inbox? Get the Marketplace newsletter every Friday. Watch out for this phone scam A new phone scam targets landlines. Source
  • Flying high: 100,000 pot plants flown from Ontario to B.C.

    Economic CTV News
    Under tight security, 100,000 marijuana plants arrived at Vancouver International Airport Saturday to be cultivated in a network of greenhouses in Langley, B.C. that’s being touted as the largest licensed cannabis production facility in the world. Source
  • Are female-led companies the answer to sexual misconduct?

    Economic CTV News
    NEW YORK -- The Weinstein Co. thought it had found a path to survival. A group of investors led by a respected businesswoman offered to acquire the company, rebrand it and install a female-led board of directors. Source
  • B.C. to appeal NEB ruling on Trans Mountain bylaw

    Economic CTV News
    VICTORIA -- British Columbia's government is appealing a decision that allows Kinder Morgan Canada to bypass local regulations in constructing its Trans Mountain pipeline expansion. The National Energy Board ruled in December that the company is not required to comply with two sections of the City of Burnaby's bylaws, which Kinder Morgan had said were hindering its ability to go ahead with the federally approved project. Source
  • PepsiCo shuts down Alberta Spitz sunflower seed factory

    Economic CBC News
    Thirty years after Spitz sunflower seeds first sprouted in Alberta, the last factory in the province is set to shut down. PepsiCo is closing the Bow Island processing plant in July, and laying off 53 workers from the small community of just 2,000 residents in the process. Source