Comparison of No Fee Travel Reward Credit Cards

As you may know, my amazing joyride with SPG MBNA's Starwood Preferred Guest card has come to an end as of February 28, 2010.  It was an amazing ride- I got to stay in Hawaii for $25 to $50 a night, got to use my points to augment my travel to Australia, and got to stay in Portland's Westin as well.  I am now a credit card orphan looking for a new no fee travel credit card to use.

Related: Canada's Best Travel Rewards Cards

In my quest to find the perfect travel card (for some reason, cash back cards just don't do it for me!  I'm more into travel cards and trading points in for free flights- don't ask me why I'm weird like that), I hope to highlight some of the options that I have been researching.

American Express Starwood Preferred Guest

What SPG is offering now is the American Express Starwood Preferred Guest credit card.  It didn't surprise me as they already have a relationship with American Express in the United States.  They haven't actually released it yet, but that it's coming in March 2010 (though we're already in mid-March).  Here are some of the details from their site:

  • Earn 1 Starpoint®* for every $1 in purchases charged to the Credit Card (this is different- it used to be 1 starpoint for $2)
  • Earn 10,000 Bonus Starpoints – enough for up to 3 FREE nights (on the first transaction)
  • Receive a Free Weekend Night Award after you reach $40,000 in purchases on the Card annually
  • Earn Gold Preferred Guest®* status after you reach $30,000 in purchases on the Card annually
  • Enjoy the flexibility to pay balances in full or over time
  • $120 annual fee (annual interest rate 19.99%)

What?? Did I just read that there was an annual fee? =(  $120 is too steep for me.  Everything else sounds really good, but I'm not too fond of having to pay a yearly fee just for using a credit card and getting the benefits.  Besides, American Express isn't accepted as readily here in Canada as say, Mastercard or Visa. Just a side note to all of you who are orphaned by the SPG MBNA Mastercard as well, you need to make a transaction within a year (either use your points or add some points) or else your points will go *POOF*!

American Express Blue Sky Credit Card

Here are some of the details of this card:

  • No fee
  • You get 12,000 bonus points on your first $3000 in purchases in the first six months
  • You get 1.25 points for every $1 you spend
  • For every $6000 you spend, you get $100 towards any travel (you can buy your travel ticket etc. first, then deduct it from your statement).  In  a way, it sort of works like a cash back card.  It gives you cash back on travel purchases only.
  • It works out to be about a 1.6% return

Citibank Petropoints Mastercard

You're probably thinking whhhatt? We're talking about TRAVEL cards, here, not gasoline cards!

The secret is that the Citibank Petropoints Mastercard has an affiliation with Asia Miles (the reward redemption company for Cathay Pacific Airways, part of the OneWorld alliance- think American Airlines, Qantas, British Airways, Japan Airlines) and you can transfer your Citibank Petro points to Asia Miles!

  • No fee
  • You earn 10 points for every $1 spent on the credit card
  • 10 Petropoints is equal to 1 point of Asia Miles (you can only transfer Petropoints to Asia Miles, not the other way around)
  • So basically for every $1 you spend, you get 1 Asia Mile (There is an Asia Miles RBC Visa that gives you the SAME $1 to 1 point but it has an annual fee of $150!).  You'll have to convert this manually online or by phone though, at 10,000 point increments (=1000 Asia Miles)
  • If you sign up through PetroCanada's website before March 29, 2010 they'll give you 15,000 bonus points (that's equivalent to 1500 Asia Miles)
  • You save $0.02/Litre of gasoline each time you use your Petropoints mastercard to pay for your purchase

The Good:

I like how this is no fee, and there is opportunity to earn more points based on filling up at PetroCanada gas stations.  I like how it's a 1:1 conversion (without having to pay the $150 a year annual fee for the RBC Visa card).

The Bad/ Somewhat Ugly:

Asia Miles makes you pay for the taxes and fees associated with the flight purchase, though this isn't usually very much.  Sometimes Asia Miles redemptions will be a bit difficult, especially if you're looking for a flight during the peak season.  I know I was in a bit of a pickle last summer when the flight BACK HOME wasn't confirmed until a few days before I had to go home.  Also, Asia Miles is limited to the above air lines, and it can be difficult to find a flight from Vancouver to Edmonton, for example.  You would end up having to take a flight from Vancouver to Seattle, then Seattle to Edmonton (AND you have to fork up more points!) because there are no direct flights with American Airlines.

Asia Miles DO expire.  I think they last for about 3 years unless you pay some extra money to “save” them.

MBNA Travel Rewards Elite Mastercard

This is the replacement card for MBNA SPG mastercard holders.  MBNA wanted to make sure their business didn't go elsewhere so they're making a new card that would be somewhat appealing.  This card is apparantly ‘exclusive' to previous SPG MBNA card holders.  There's a non-elite version of the Travel Rewards Card and it has an $89 annual fee.

Here's the basics of the new card (I haven't actually received it in the mail yet- expected to arrive in about 4 weeks):

  • You will earn 1 point for every $1 you spend
  • 5000 bonus points on first retail purchase after the new credit card activiation
  • The points can be used towards any type of travel (any hotel, roundtrip flights, vacations and crusies, tours, rental cars)
  • There is a 1% cashback option if you want to get cashback instead of travel
  • The redemption for travel will be handled by Carlson Marketing (which was recently bought out by Aeroplan) who also handles the TD Travel Rewards redemptions as well.  The website is: www.mytravelrewardscentre.com/elite to manage your bookings, it seems super slow though- maybe they'll work out the bugs soon.
  • No fee ($0 annual fee)
  • You can pay for booking fees and taxes with points
  • Points can be purchased for $0.03 per point (cheap!)
  • Travel Rewards have a 100,000 point accrual limit
  • They'll give you 2500 points on your anniversary (awe how sweet!)

Here's the chart on how many points you will need for flights:

How far will your points take you?

DestinationsPoints required for return air travel
Flights within or to the next adjoining province, territory or US state15,000
Flights from Canada to the U.S25,000
Flights from Canada to the following:

  • Bahamas
  • Bermuda
  • Mexico
  • Caribbean
  • Hawaii
40,000
Flights from Canada to the following:

  • South America
  • Central America
  • Europe
60,000
Flights from Canada to the following:

  • Asia
  • Middle East
  • Africa
  • Australia
75,000

That works out to be about a 2% return towards hotels, a 2% to 2.5% return on flights depending on how much flights usually cost and where you're going (I would save up 75,000 points for the flight to Africa or Australia- the most expensive flights available) and a 3% towards paying for taxes and fees and even travel insurance.

For example, an average flight to Kilimanjoro in Tanzania, Africa is about $2500.  If you spend $75000 (about two years of charging everything to the card), you get 75000 points which is enough for a flight to Africa.  Which works out to be a 3.3% return.  Not too shabby for a no fee card.

The Good:

I like that the MBNA Travel Rewards Elite Mastercard has no annual fee.  I like that you have the option of using cashback instead of travel rewards if you wish.  I like how they have a standard point redemption system depending on where you're going.  I like how there is no “cap” of $30,000 spent like the previous SPG card.  I like how you can book with any airline that you want.

The Bad/ Somewhat Ugly:

The downside is that the flights are only redeemable from a major gateway in Canada so if you live in a small town, you'll have to find your way to one of the major cities (Victoria, Vancouver, Calgary, Edmonton, Regina, Saskatoon, Winnipeg, Toronto, Ottawa, Montreal, Quebec City, St. John's (NF), Halifax, Saint John (NB), Moncton, Charlottetown, Whitehorse and Yellowknife).  For comparison I looked overseas and card holders in Australia can book from any of their cities, hopefully we will soon too.  Sell below for the resource I used:

http://www.hsbc.com.au/1/2/personal/credit-cards/platinum-qantas

I am curious to know if the hotel bookings are using rack rates, because if they are, then that's not such a great deal because sometimes you can find better deals on hotwire.com or priceline.

And lastly, kind of a moot point, but the new card isn't as visually sexy to look at as the previous MBNA SPG card.  I used to get compliments all the time about my pretty card.  The new MBNA Travel Rewards Elite card is plain silvery looking with a plane flying around a globe or something.

Not sure if there is an expiry date for the MBNA Travel Rewards Elite points, this is an important factor to consider.

Youngandthrifty's Verdict:

I was really looking forward to signing up for AMEX's SPG card, until I saw that there was a $120 annual fee associated with it.  The AMEX Blue Sky and SPG card aren't readily accepted everywhere in Canada.  So I think for now, I will stick to the  MBNA Travel Rewards Elite and see how it pans out.  In the future, I may also sign up for the Citibank Petropoints Mastercard so I can rack up my Asia Miles… though one has to do ALL the spending on a main card in order to really rack up those points.  I will think about it some more. =)

Depending on where you're redeeming your flight for, the Citibank Petropoints Mastercard may be better than the MBNA Travel Rewards Elite card and vice versa.

For example:  If you are flying from Vancouver to Las Vegas, with Asia Miles, it will cost 20,000 points.  With the MBNA Travel Rewards Elite card, it will cost 25,000 points.  On the flip side of the coin, if you're traveling from Vancouver to Melbourne, Australia, with the MBNA Travel Rewards Elite card, it will cost 75,000 points.  With Asia Miles, it will cost 90,000 points.  If traveling from Vancouver to Tokyo, Japan, with Asia Miles it will cost 45,000 points.  With the MBNA Travel Reward Elite card, it will cost 75,000 points.  You get the point.

What do you think of these credit cards?  Any one that piques your interest more so than the others?  Are you a reward card junkie like me?

10 Comments

  1. The Rat on March 16, 2010 at 7:56 am

    Hi it’s me again, surprise surprise! 🙂

    To answer your question, yes I am a rewards junkie to the bone, and I have gone through some of my own credit cards offering rewards and so forth.

    At first, my main objective was to have a card that had no annual fee but somehow offered me incentives to receive rewards. For example, I had a CIBC Dividend card which had no annual fee and at the end of each year, I would get a % of my purchases (hence, the ‘dividend’) back in cash. It wasn’t all that great from my perspective.

    I also have a family member that went for the American Express card (for the massive amount of points on sign up) but had a serious problem with the flight scheduling limitations because he doesn’t live near one of the major centres. I was fortunate to learn from that without actually experiencing it.

    My main promotion card that I have and I hate to admit it but enjoy is my Aerogold Visa card. Admittedly, it has an annual fee, but there are a LOT of perks in having one if you use it to your advantage and can plan ahead for travel purposes. Here’s why:

    *Upon sign up, I got 15,000 Aeroplan miles right off the bat. This is just enough for a return ticket to fly to a lot of destinations provided you plan ahead.
    *Sign up for an unlimited chequing account at CIBC and you will get 100 points in your account every month
    *Sign up for Aeromove and get 250 free points at no cost.
    * Every time I travel and have to stay at a hotel, I get 250 aeroplan points at the Best Western (have to sign up for a free Best western card though) per stay. I just booked another reservation tonight and the current promotion is double the points
    *Drink Tropicana? Redeem your points at BreakfastCentral.com. It all adds up!
    *If your plans change, get your points back. I recently had to cancel a flight for this summer and got all my points back into my account by calling them. No questions asked.
    *SPG card. I signed up for a free SPG card and when my wife and I went on our honeymoon, we stayed at Sheraton hotels. When you accumulate a minimum amount of SPG points, you can convert them to Aeroplan points 1 for 1
    *Sign up for Esso Speedpass and you can get 200 aeroplan points.
    * When you buy groceries and gas, you get 1.5 times the miles
    *I pay my utility bills with my card for the points and pay them off as they are charged. That way, I get the points and the bills are pre-authorized and worry free. Only one place to pay.
    *When you rent a vehicle you’re covered on the collision/loss damage insurance. Just get the liability. Also, some rental companies offer 20% discounts. Hertz is offering over 1000 points for a 5 day rental right now as I write this.

    These are the main reasons I decided to go with Aerogold Visa. I can’t speak for the other cards you mentioned in your post, but I’m pleased with managing my rewards in the way described.

    Best of luck in your decision.
    Cheers
    .-= The Rat



  2. young on March 16, 2010 at 7:57 am

    @The Rat Hey again! I like it when you visit- you always have really good comments =) Yes, the CIBC Dividend cash back isn’t really that great (the no fee one) because they don’t give you much % return. I have heard about the Aeroplan Visa card, I know that aeroplan miles don’t expire for 7 years (which is good compared to the 3 years for Asia Miles). Is the annual fee about $120 or so? Yes, with the SPG points, they’ll transfer it 1:1 to aeroplan, AND if you have 20,000 SPG points transferred- they’ll give you 5000 points. *sigh* the SPG program was so great.
    That’s actually really good that you get your points back if you want to cancel your flight! Thanks again for sharing with us all the great perks of Aerogold! I will seriously consider it if this MBNA Travel Rewards Elite card doesn’t pan out.



  3. Doctor Stock on March 23, 2010 at 4:18 pm

    I recently went away from my no-fee travel card… because at the end of the day, they still charge me taxes, etc. I use a no-fee dividend card that pays me cash each year :).
    .-= Doctor Stock



  4. young on March 23, 2010 at 4:40 pm

    @Doctor Stock Hello Doctor Stock! Thanks for stopping by- I love your tweets! =) The MBNA Travel Rewards card taxes can be paid off by points, which is a bonus. Even fee- travel cards (like Aerogold or Avalon) will charge you fees and taxes from the airlines. I’m not too bothered by paying the taxes because it’s usually very small (c’mon for a FREE flight?). I think everyone has their preferences (cashback or rewards) =) I hear the Smart Cash MBNA card is really good for cashback.



  5. Guy G. on April 14, 2010 at 9:32 pm

    Hey,
    Of all the cars I have right now with no fees and rewards, I’d have to say I like the PC. Thankfully I’ve learned some tips on budgeting since my bad spending days and am reducing my balances. Why PC? Well, I love food, and nothing is better for me than to get to the checkout counter and say “I’ll use my points please” and pay like $2.50 for the balance of a $50 cart of groceries.

    There’s a caution though. Points were introduced to make you ‘want’ to spend more. My Dad is a perfect example. He’ll sometimes buy stuff that he doesn’t REALLY want too much and definitely doesn’t need just to get the points.
    .-= Guy G.



  6. young on April 15, 2010 at 7:47 am

    @Guy G. Hey Guy, I know what you mean- the other day at Superstore I saw a lady who asked to have her groceries paid for with her points- I was jealous =) I should look into the PC mastercard, maybe I’ll just use it when I shop at Superstore. Sometimes I can be like that too, at Shoppers Drug Mart- buy stuff that I don’t really need because a) it’s on sale b) it’s points day!



  7. Chris on August 21, 2010 at 4:02 pm

    I have the MBNA travel rewards elite – and a warning to anyone wanting to modify reservations:

    I modified a 3 night stay to a 1 night stay, and weeks later, still no refund on my credit card. I called the travel rewards centre a few times and they all seem pretty confused and can’t figure out the fact that they still owe me money.

    bottom line, I’m done with this card. Call centre also takes about an hour to process any call.



  8. young on August 21, 2010 at 6:32 pm

    @Chris- Thanks for sharing. Awe man, you serious?? I had a feeling they wouldn’t be up to par =( I hadn’t booked anything with my points yet. =(



  9. Rewards Junkie on July 14, 2014 at 9:34 pm

    I liked your blog and find it informative. I have an MBNA card which I was going to transfer to an MBNA Choice Privileges Master Card due to the incredible offer of bonus points. Unfortunatley now it’s only offered by Barclays Visa card in the US. I was considering the MBNA Best Western Master Card but wanted your opinion and or if there’s a better no fee credit card that lets you earn hotel points. Thanks !!



  10. Kyle on July 14, 2014 at 11:23 pm

    I’m all about the Capital One Aspire Card personal RJ.



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