Travel credit cards are a great way to earn free flights. We looked at two of the best travel credit cards—the Scotiabank Gold American Express Card and the BMO World Elite MasterCard—to figure out how much you’ll have to spend and how long it will take before you earn enough rewards to travel to three popular destinations. Both of these cards waive the annual fee for the first year, but have different sign-up/spending bonuses and rewards structures.
The Scotiabank Gold American Express card gives you a $300 travel credit (30,000 points) if you spend at least $750 within the first three months of opening your account. With this card, you get four points per dollar on gas, groceries, restaurants, and entertainment as well as and one point per dollar on all other purchases. After the first year, the annual fee is $99.
With the BMO World Elite MasterCard, you receive a $200 travel credit (20,000 points) immediately upon approval. This card is pretty straightforward: You get two points per dollar on all purchases. The annual fee of $150 after the first year.
Using the following monthly spending profile on the MoneySense Credit Card Finder, how long will it take you and how much do you have to spend to accumulate enough points to travel to Costa Rica, Iceland, or Australia?
The Scotiabank Gold American Express card will earn you $42 in rewards a month. Combined with the $300 bonus if you pass the $750 spending threshold within the first three months, you’ll have $426 in travel rewards in three months—enough to cover the cost of a round-trip flight to Iceland with some money left over.
In four months, you’ll have enough with the BMO World Elite MasterCard to cover the same flight. In six months, you’ll have enough points to cover the cost of a round-trip flight to Costa Rica if you use the Scotiabank card. With the BMO card, it will take a full year for the same trip.
This trend continues as it takes 20 months to get to Australia on points with the Scotiabank card but 43 months with the BMO card.
With a higher spending bonus and a lower annual fee, the Scotiabank card outperforms the BMO card in all three instances even though it has a lower annual fee.
Before choosing a card, make sure you know how much you spend and where you spend because it can make a huge difference in how fast you accumulate points. For example, you may be better off with the BMO World Elite MasterCard if you spend more than $1,500 a month and majority of your spending isn’t on gas, groceries, restaurants, and entertainment. Regardless of which card you choose, using one of the best travel credit cards in Canada will help you earn free flights around the world. See the infographic from Ratehub.ca below for more information.