Weekend Reading: Aeroplan Woes Edition

Weekend Reading: Aeroplan Woes Edition

My wife and I are saving for a big trip next year – our dream vacation to Ireland. While we’re light on trip details right now I’m busy thinking about the best way to get us there. One option is to use Aeroplan miles. We have approximately 160,000 Aeroplan miles right now and we could conceivably find ways to earn another 80,000 miles or so in the next few months.

It’ll take 240,000 Aeroplan miles to get our family of four from Calgary to Dublin, Ireland, plus fuel surcharges and taxes of $2,500. That compares to paying Air Canada $3,891 directly for the same round-trip flight for four. Not a great value per mile but still worth considering.

It would be a better experience and better value to fly business class, but that’ll take 440,000 Aeroplan miles, plus the $2,500 outlay for ripoff fees surcharges and taxes. That gives us a return of 2.6 cents per mile, but we’re unlikely to accumulate that many miles in such a short time.

I’m pushing to use our Aeroplan miles on a big trip before 2020 when the Air Canada / Aeroplan agreement expires. Air Canada is actively pursuing its own frequent flyer rewards program and the growing sentiment is that Aeroplan miles will become more difficult to use (at best) or the program will fold (at worst).

Parent company Aimia’s stock has taken a massive hit since the announcement, sinking to $1.69 this week (it was at $9 just one year ago). Meanwhile, investors reacted positively to Air Canada stock, as it doubled from $13 to $26 over the same time frame.

As Aeroplan woes continue, I’m hoping to extract the most value from the program before it’s too late.

This Week’s Recap:

One way I’m hoping to accumulate more travel miles is by churning a couple of rewards credit cards. I reviewed one of them, the American Express Platinum Card, over on my Rewards Cards Canada blog. The card comes with a hefty annual fee but the perks, especially in year one, are worth it.

On Monday I shared what self-employed Canadians need to know when filing their taxes.

On Wednesday Marie explained how to strike the right balance between risk and reward.

And on Friday I compared free tax software providers SimpleTax and TurboTax Free.

Sticking with the tax season theme, over on the TurboTax blog I looked at CPP and EI considerations for self-employed Canadians.

Finally, if you haven’t signed up for Global’s Money 123 newsletter you probably should. Columnist Erica Alini included a quote from me in her latest piece on long-term disability and longevity insurance.

Weekend Reading:

Kyle Prevost, author of the Young & Thrifty blog, is also a high-school teacher in rural Manitoba. One of the courses he teaches is about personal finance. In fact, he helped develop the curricula currently being used in the province. Naturally, he became incensed when he listened to a podcast called The Financial Literacy Hoax, which argued that teaching financial skills in school is a waste of time.

Kyle’s response to address the victim mentality in personal finance is well worth the read.

Underestimating how much you’ll spend in retirement can be costly. This Wall Street Journal article looks at where retirees underestimate their spending.

Why the Manulife Advantage Account might be the most useful savings account in Canada.

How the interest rate vise is closing on people with home equity lines of credit.

Looking like a rival to Morgan Housel’s writing, Nick Magiulli reflects on the ever changing landscape of markets.

The Google Finance refresh left many investors looking for an alternative. Luckily, the Dividend Earner blog put together a comprehensive list of nine alternatives to get your stock data.

Here is Lethbridge, Alberta we don’t have an international airport which means either driving 2.5 hours north to Calgary or 3 hours south to Great Falls, Montana to catch a flight. Budget carrier Allegiant Air flies out of Great Falls and offers incredibly cheap fare to Las Vegas and other sunny destinations. Well, travellers might want to think twice about that after this 60 Minutes expose:

Here’s the Farnam Street blog with the ultimate guide to making smarter decisions.

Jason Heath on why incorporation isn’t always a magical tax fix for your small business.

Why do retirees fear starting CPP late? Fred Vettese explains:

“Studies have shown that people routinely overestimate the probability of dying young, which is why they tend to favour starting CPP early. This is probably owing to the power of anecdotes versus statistics. Knowing one person close to you who has died young is more compelling than some dry statistics based on thousands of deaths.

Unless you have very good reason to think your own situation is special, it is probably better to start your CPP at 70. If you start CPP early and live an average lifetime, you’re leaving more money on the table than you think.”

Ben Carlson lists three ways to make up for a retirement savings shortfall: Save more, work longer, and/or reduce expectations.

One of the questions facing many homeowners this year: Should you lock in your mortgage rate or renew early before interest rates rise again?

Michael James used to work in the field of cryptography and offers one of the better explanations of Bitcoin and other cryptocurrencies that I’ve come across on the web.

Finally, why does a Certified Financial Planner need to hire his own planner? Carl Richards did exactly that to, as he explained, “protect me from stupid.”

Have a great weekend, everyone!

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  1. ross on April 22, 2018 at 8:06 am

    Oof, that is indeed a terrible aeroplan redemption value.
    I assume that’s the YYC -> YYZ -> DUB route on Air Canada.
    You can probably do better.
    Heck, you could fly Air Transat Jun 8th, return Jun 27th for $3,397 all cash.

    How about this route instead?
    YYC -> ORD on United has taxes+fees of $260.44
    ORD -> DUB United + $28.40
    DUB -> EWR United + $213.20
    EWR -> YYC Air Canada + $281.60

    Total: $783.64 + 240,000 miles + phone booking fee

    Or, if you don’t mind one extra stop on the way home, EWR -> DEN -> YYC on United + $28.40 Saving you another $253.20

    You would have to call in to book that but I think it’s a valid route. There’s a fee for booking by phone. Also, the YYC -> ORD flight is hard to get award seats on so you’ want to book that as far in advance as possible.

    • Echo on April 22, 2018 at 8:27 am

      Hi ross, thanks for the comment. Yeah, I’ll definitely be looking at other options to reduce the fees & taxes – flying United being one of those options. Have you had good success calling to book? I don’t mind the booking fee if it could save me many hundreds of dollars in other fees.

      On the other hand, I don’t want to put my family through too much of a milk run just to save some money so the route will have to make sense.

      Hoping to be ready to book a year in advance so we have the opportunity to get the best flights.

      Thanks again!

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