You've been hearing more and more about travel rewards credit cards, but just how popular are they among Canadians-and what do Canadians use them for?
A new study by Expedia and Egencia suggests that travel rewards cards are becoming increasing popular for millennials around the world. The study found that those between 18 and 30 travel more for work and are more likely to extend a business trip into a vacation. In fact, 70 per cent of younger Canadians reported mixing business and pleasure, compared to 50 per cent of those aged 31-45, and 31 per cent of those 46 and older.
Travel rewards credit cards are no doubt a popular choice. Another survey, by Scotiabank, found that 90 per cent of the Canadians surveyed belonged to a travel rewards program, and more than half of these Canadians have a personal credit card that offers travel rewards.
How Canadians pick travel rewards cards
The Scotiabank survey looked at factors Canadians weighed when choosing travel rewards cards and found that an overwhelming amount ranked the most important factor as how quickly they can earn points on each dollar spent. Next, it depended on the specific travel rewards program affiliated with the card, then the type of card, and finally the issuing bank.
What frustrates Canadians about travel rewards cards?
Canadians reported that they were most frustrated with annual fees, suggesting they would prefer "no fee credit cards". While not all travel rewards cards have fees, premium ones often do. Consider your spending habits as in many cases, depending on the card, the rewards may be worth the return on your investment.
Canadians also disliked the time it took to accumulate points, as well as limitations placed on travel such as seat restrictions, limited airline choices, or blackout periods on flights. Make sure you read the fine print so you can be a happy traveller, not a frustrated one! There are so many different travel rewards credit cards available that there's no need to settle for one that is unsatisfactory to your needs.
How Canadians redeem travel rewards
While travel rewards points can be used on a variety of things, it makes sense that travel is the number one redemption.
The survey found that two-thirds of travel rewards program members flew in the past year and nearly half of cardholders redeemed points within the past year. Of those, 74 per cent of members who redeemed points in the last 12 months did so for travel purposes.
And while millennials may like to travel for business and pleasure, Canadians redeeming travel rewards points do so for personal reasons, including purchasing flights for other family members. In fact, only 16 per cent of redemptions were for business purposes. So it looks like Canadians use their travel rewards points to let loose a little and travel somewhere fun.
How Canadians find the right rewards card
When choosing a travel rewards card it is important to consider what you want to use those rewards for-do you want to travel, buy things for your house, or get new electronics? Is it important to you to choose your own seat or fly anytime you want? How soon do you want to travel? Certain rewards programs are better suited to certain people, depending on your needs.
You also want to think about your spending habits and how you use your card. Many cards offer points on a per dollar basis, but every card is different. Some even offer special bonuses when used at specific places, not to mention sign up incentives. A little digging (KANETIX can help with that) and you'll find the card that's right for you.
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