Rumours had been floating around for several weeks that Capital One was about to discontinue its popular Aspire Travel World MasterCard – arguably the top travel rewards card on the market.
The card was pulled from affiliate channels like Rate Supermarket but remained listed on Capital One’s own website – that is until today when it was removed and replaced by something called the Capital One Aspire Travel World Elite MasterCard.
No word yet on whether existing Aspire Travel World MasterCard cardholder benefits will be grandfathered or if Capital One will look to move those members over to this new product.
When Capital One pulled its Aspire Cash World MasterCard in August 2013, existing cardholders kept their benefits intact, but the credit card issuer did not replace that card with a new one – opting instead to move forward with the watered-down Aspire Cash Platinum card in its cash back line-up.
The good news here, if any, is that Capital One has appeared to replace the Aspire Travel World MasterCard with a World Elite MasterCard that appears at first blush to offer similar benefits to that of the MBNA Rewards World Elite MasterCard, albeit at a slightly higher annual fee.
New Aspire Travel World Elite MasterCard
Here’s a look at the new card and what it has to offer:
- 2 reward miles for every $1 spent on the card
- 10,000 bonus miles on your first purchase – a value of up to $100
- Free supplementary card for spouse
You’ll get the same No Hassle Rewards that were offered with the old card:
- Book your own trip – including the hotel, airline or rental car of your choice – then redeem your reward miles for your travel expenses
- Pay for the taxes on your travel with your miles
- No blackout dates or hidden fees
In fact, it looks like the tiered structure for redeeming travel reward miles will also remain intact:
| Cost of Your Travel | Rewards Miles Needed |
| Up to $150 | 15,000 |
| $150.01 to $350 | 35,000 |
| $350.01 to $600 | 60,000 |
| $600.01 and greater | Travel cost x100 |
Cardholders can continue to redeem their miles for cash, merchandise, or gift cards at the same discounted value as before.
The World Elite brand means new applicants will need to have either personal income of $70,000 or household income of $120,000 in order to qualify (up from $60,000 or $100,000). The new card comes with the standard $120 annual fee for premium travel cards.
Loss for travel rewards market
This is a huge loss for the Canadian travel rewards market as the old Capital One Aspire Travel World MasterCard was in a class of its own – offering new applicants 35,000 bonus miles with their first purchase and 10,000 bonus miles each year on their card anniversary, which effectively reduced the annual fee down to $20.
Related: How to cut through the noise and choose the best rewards card
Here’s a look at what a new cardholder would have earned under the old Aspire Travel World MasterCard benefits if he or she spent $2,500 per month:
- 60,000 miles on purchases
- 35,000 bonus miles on first purchase
- 10,000 bonus miles on card anniversary
105,000 first year reward miles = up to $1,050 in travel rewards
Now here’s what a new cardholder will earn with the new Aspire Travel World Elite MasterCard on $2,500 per month spend:
- 60,000 miles on purchases
- 10,000 bonus miles on first purchase
70,000 first year reward miles = up to $700 in travel rewards
As you can see, it’s not even close. There’s a $350 difference in earnings between the two cards, not to mention the 10,000 annual bonus miles that are no longer offered by the new product.
Final thoughts
We figured there would be disruption in the rewards credit card space this year after Visa and MasterCard were “voluntold” to lower their interchange fees or face the wrath of the federal government.
Were the bonus miles simply too rich for Capital One to continue paying out to its new and existing cardholders? Will other premium travel rewards cards follow suit? Time will tell.
What do you think about this move by Capital One?
A Canadian author asked me to contribute to his latest book, which is aimed at people with 10 years or less to go until retirement. He said the target audience probably “doesn’t have enough savings set aside and most likely still has a mortgage and maybe a line of credit.”
The author wanted me to share my thoughts on which credit card points systems were best for this group.
“My guess is people like simplicity and therefore cash back sounds really good, but maybe when they are approaching retirement, possibly travelling more and have time to spend figuring out how to use the rewards cards, travel rewards might be better. I have a Visa Infinite Aeroplan but find booking flights with Aeroplan a real pain and the fees and taxes awful.”
With so many options to choose from, how do you decide which program is best? Here is my response:
How to choose a rewards credit card
Rewards credit cards are best suited for anyone who doesn’t carry a balance from month-to-month and can resist the urge to overspend just to earn points.
There are easily more than 200 rewards credit cards on the market but, unfortunately, there isn’t that one magic card that’s best for every situation. Before choosing a rewards card you need to consider your monthly budget as well as the categories where you spend the most money.
Related: Where to find the top rewards credit cards today
You might find that it’s a good idea to carry two or even three different credit cards to cover all of your spending categories and help boost your rewards.
Cash back
If you’re looking for a hassle-free way to earn money back on your everyday spending, look for a no-fee cash back card that pays 1 percent or better. Current examples include Amex Simply Cash, MBNA Smart Cash, and the PC MasterCard.
If you want a little more bang for your buck and you don’t mind paying an annual fee, look for a premium card that pays 2 percent or more on categories like groceries, gas, dining, or travel. Current examples include the Scotia Momentum Visa Infinite and the Amex SimplyCash Preferred.
Here are the top cash back cards, no-fee and premium.
Travel rewards
Many Canadians love to travel and earn points toward free flights and hotels. The best travel rewards cards give you the opportunity to earn points quickly, plus the flexibility to use those points however you want. That means allowing you to book flights on any airline, or stay with any hotel chain, and then applying your rewards to the charge on your credit card statement.
The best current examples include the Capital One Aspire Travel World MasterCard, CIBC Aventura, TD First Class, RBC Avion, BMO World Elite, Scotiabank Amex Gold, and the American Express Gold Card.
Aeroplan is the number one loyalty program in the country, but redeeming points can be a hassle. In fact, the number one complaint I get from readers is about the Aeroplan program. I’ve written a series of posts about the program:
- One Aeroplan member’s $2,200 flight reward shock
- Aeroplan collectors fed up with rewards program
- One Aeroplan member’s somewhat satisfying update
- Aeroplan rewards more expensive than cash fare
Finally, if you purchase from a U.S. retailer, or travel to the U.S. or abroad, look for a credit card that does not charge a 2.5% fee to convert your foreign currency purchases back into Canadian dollars. The best current examples are the Amazon.ca Rewards Visa and the Marriott Rewards Premier Visa.
Final thoughts on choosing a rewards card
I use the Scotia Momentum Visa Infinite to earn cash back on grocery and gas spending, and then use the Capital One Aspire Travel World MasterCard for everything else. I also keep the Amazon.ca Rewards Visa in my wallet for any travel or purchases outside of Canada.
Read here about how I earned over $1500 in credit card rewards last year.
One thing to keep in mind is that many premium cards such as Visa Infinite and World or Elite MasterCard are only available to high income earners ($60,000+ annual personal income or $100,000+ annual household income).
And again, beware of hidden fees like foreign currency conversion, which can cost more than the rewards that you’ll “earn” on any purchases and travel outside of Canada.