How To Maximize Your American Express Membership Rewards Points

Collecting credit card points is one of my favourite things to do and over the years I’ve decided to take things to the next level by really understanding how most of the rewards programs work. I’m not referring to Aeroplan or Air Miles which are both totally different beasts, but rather, I’ve recently dived deep into bank rewards programs.

Bank or credit card provider points programs can vary quite a bit. They all have different earn rates, ways to redeem and transfer partners. Making a redemption is usually easy, but if you really look into the details, you’ll quickly realize that you may be able to get more value out of your points. Today I’m going to show you how to maximize your American Express Membership Rewards Points and RBC Rewards.

American Express Membership Rewards and Marriott Bonvoy

In my opinion, American Express has some of the best travel credit cards in Canada. I favour them because the American Express Membership Rewards (MR) points you earn are so flexible. At their base value, 1,000 MR points are worth $10 in value. However, you can transfer your points to Marriott Bonvoy at a 1:1.2 ratio where they may be worth even more.

Related: Is the American Express Platinum Card worth the $699 fee?

For example, let’s say you’re booking a category 2 hotel that has a real value of $215 or will cost you 17,500 Marriott Bonvoy points. Well, to get 17,500 Marriott Bonvoy points you would need to transfer 14,583 MR points. Had you used the regular Amex MR points to claim $215 in travel, it would have cost you 21,500 MR points. In other words, you would have saved 6,917 MR points by transferring your points to Marriott Bonvoy.

Now keep in mind that sometimes it makes sense to not transfer your points. Let’s say you’re interested in a category 6 hotel with Marriott that would cost you 50,000 points and has an average nightly rate of $375. To make a reward redemption, you’d have to transfer 41,667 MR points to get 50,000 Marriott Bonvoy points. Booking that same hotel through the Amex travel portal using your MR points would cost you 37,500 MR points which is 4,167 fewer points.

There’s one more thing to consider, Marriott Bonvoy gives you the 5th night free when you book 4 nights on points so transferring your points may still be worth it since you’ll pay less points on the average nightly stay even though each individual night is technically costing you more points.

Booking flights with American Express Membership Rewards

With American Express Membership Rewards, you can also transfer your points to Aeroplan at a 1:1 ratio. Amex MR also has a fixed mileage program where you can fly to certain regions for a fixed amount of points. This essentially gives you three ways to book your flights on points.

I recently flew to Seattle from Toronto and the flight was $900 (yeah I know, that’s crazy expensive). With Aeroplan, that route only requires 25,000 Aeroplan miles which is obviously a much better deal than the 90,000 MR points I would have spent if I had use them at their base value. However, Aeroplan is famous for having limited availability so I had to make sure I could actually book a seat first before I transferred my points. I couldn’t, there was no availability.

Since Aeroplan was no longer an option, I decided to book with the American Express Fixed Mileage program. For my route, it would cost me 40,000 points for a flight with a base fare value up to $900. That worked out for me since my flight had a base value of $800 and about $100 in taxes. Those taxes cost me 10,000 points, so in total I spent 50,000 points for my flight. Yes, it was double what I would have paid with Aeroplan had there been availability, but it was also 40,000 points less than if I had claimed through regular MR.

Getting to know your RBC Rewards

American Express Membership Rewards is honestly one of the best loyalty programs but not everyone uses it. Many people just use their regular bank’s travel loyalty program. They typically have limited transfer partners but that doesn’t mean you can’t maximize the value of your points. Here’s a breakdown of some of your redemption options with RBC Rewards:

• 1,000 points = $10 in travel when booked through the RBC Rewards travel portal
• 1,200 points = $10 in RBC financial rewards (your mortgage, RRSP, etc.)
• 1,400 points = $10 in gift cards for non-travel merchants

As you can see, travel rewards clearly give you the best return yet many people are still using their points for gift cards. I suppose you could argue that financial rewards are the best if used towards an RRSP contribution since you would get a tax break but I’m trying to keep things simple here.

Another thing to note is that RBC Rewards can be transferred to WestJet Dollars. The transfer ratio is 1,000 RBC Rewards points = $10 in WestJet dollars. This is valuable to know in the event you want to cancel your RBC credit card and you’re looking for a way to covert your points into “cash.” The transfer value to WestJet is much better than for gift cards.

RBC is the only major bank to offer an airline transfer partner but the other banks also allow you to redeem your points for other things besides travel which is why you want to know the value of all those transfers.

Final thoughts

I’ve showed you how to maximize your American Express Membership Rewards and RBC Rewards points. But there are many other rewards programs across Canada.

As you’ve likely quickly learned, understanding how you can use your points can greatly affect the value of your points. I’m not saying you need to know the details of every program or the different earn rates of specific credit cards, but you really should look into your rewards program to see how it can benefit you the most.

Barry Choi is a personal finance and travel expert at MoneyWeHave.com. He has been quoted by media in Canada and the United States, including The Financial Post, The Toronto Star, Business Insider, The Globe and Mail, and has appeared on HuffPost Live. You can follow him on Twitter: @barrychoi