Miles & Points for Beginners: Why Points Matter

If you've heard that miles and points can get you into business class without paying $5,000+ for a ticket, you've heard right. But "free" business class flights don't just fall out of the sky – there's a learning curve, and it can feel steep at the beginning.

This Miles & Points for Beginners series is designed to get you over that curve. We'll walk through the fundamentals – from what points are, to how to earn them, to how to turn them into trips that would otherwise be out of reach.

Let's start with the backbone: What are miles and points, and why do they matter?

What Are Miles & Points?

Miles and points are currencies created by airlines, hotels, and banks. Like real currencies, you accumulate them and spend them – except instead of buying groceries, you're booking flights and hotel stays.

The most common ways to earn them are through credit card spending and loyalty program engagement – welcome bonuses, everyday purchases, flights, and hotel stays.

Credit card rewards come in four forms:

• Cash back
• Fixed-value points
• Loyalty-program points
• Transferable points

Each type has its place in an overall travel strategy.

That said, if your goal is luxury travel – business class flights, premium hotels – certain types are far more powerful than others. Let's break them down.

Different Kinds of Rewards: Cash Back

Every bank offers some form of cash back credit card. Spend money, get a set percentage back. Simple.

Cash back always has 1:1 value. Earn 1% cash back, and you get $1 (all figures in CAD) for every $100 you charge. No more, no less.

Some cards offer higher rates on specific categories. The Scotiabank Momentum® Visa Infinite* Card, for example, earns:

• 4% cash back on groceries and recurring payments
• 2% cash back on gas and transit
• 1% cash back on all other purchases

If you have large grocery expenses and don't care about travel, that's a solid card.

But here's the problem. If you want a business class flight, a family vacation, or a fancy hotel stay, the math on cash back just doesn't work.

Throughout this series, we'll use the example of booking business class – it's the most common reason people start paying attention to miles and points.

Say you've got your eye on a business class flight that costs $5,000 to book outright.

With a 1% cash back card, you'd need to spend a staggering $500,000 to earn enough to cover that flight. Even with a higher earning category, the required spend is out of reach for most people.

If business class is the goal, cash back isn't going to get you there. You need to look at credit cards that earn miles and points.

Different Kinds of Rewards: Fixed-Value Points

Fixed-value points are a step up from cash back. Instead of just receiving money back, you can redeem them for travel, gift cards, merchandise, and statement credits.

True to the name, they redeem at a fixed rate – generally around 1 cent per point, with some exceptions.

In Canada, the main fixed-value points programs include:

• BMO Rewards
• CIBC Aventura
• Scene+
• TD Rewards

You can typically earn fixed-value points at a better rate and redeem them for more value compared to cash back cards.

For example, Scene+ points redeem against travel purchases at 1 cent per point, up to one year after the transaction. You can earn them on various Scotiabank-issued credit cards at rates of 1–6 Scene+ points per dollar.

Then there's CIBC Aventura, where you can redeem against travel purchases at 1 cent per point through the travel portal. Or, book flights through the CIBC Aventura Airline Rewards Chart, which can yield up to 2.29 cents per point on certain routes – a meaningfully better return.

Better than cash back, for sure. But for that $5,000 business class flight, you'd still need to spend $100,000–$500,000 depending on your earning rate. That's not going to cut it either.

Fixed-value points are a useful part of your overall toolkit – but the real magic comes from loyalty programs and transferable points.

Different Kinds of Rewards: Loyalty Programs

This is where things get interesting.

Most airlines and hotel chains run loyalty programs. You earn points by flying or staying – and crucially, through credit card partnerships.

Aeroplan is the prime example. You earn Aeroplan points by flying with Air Canada or its airline partners, or by spending on an Aeroplan co-branded credit card.

With a co-branded card, points land directly in your loyalty program account – through the welcome bonus and your monthly spending.

You can redeem loyalty program points for flights, hotel stays, gift cards, and merchandise – but we'd strongly recommend sticking to flights and hotel stays. The value you can extract is dramatically better than redeeming for gift cards or merchandise.

Each program has its own set of sweet spots and quirks. The more time you invest in learning about them, the better equipped you'll be to reach your travel goals.

Different Kinds of Rewards: Transferable Points

Transferable points are the most versatile currency in the game.

In Canada, there are two transferable points programs: American Express Membership Rewards (MR) and RBC Avion Rewards.

You earn these by spending on Amex MR or RBC Avion credit cards. The points sit in your rewards account until you decide what to do with them.

The key advantage: you can convert them into airline or hotel loyalty program points at various ratios. In our view, this is the most powerful way to use your points if you want to travel more – and travel better.

You also have all the other redemption options at your disposal – statement credits (like cash back), booking flights through the RBC Air Travel Redemption Schedule or the Amex Fixed Points Travel Program, or transferring to external loyalty programs.

In short: Amex MR and RBC Avion points can do everything cash back and fixed-value points can do, plus they unlock loyalty program redemptions. That's what makes them so powerful.

Now let's bring back that $5,000 business class flight. This is where it all clicks.

You can book a one-way business class flight from North America to Doha in Qatar Airways Qsuites – widely considered the world's best business class – for 70,000 Avios through Qatar Airways Privilege Club, plus roughly $300–400 in taxes and fees. A paid ticket on this route runs $5,000–$10,000.

To get the Avios, you transfer your Amex MR or RBC Avion points to The British Airways Club at a 1:1 ratio, then move them to your Qatar Airways Privilege Club account via Combine My Avios. 70,000 points in, Qsuites out.

Now, it's not always that clean in practice. You'll need to navigate award availability, figure out which loyalty program is best for booking specific airlines, and work through a number of other considerations.

But if you put in the effort, you'll book flights and experiences at a fraction of what they'd cost out of pocket. That's the whole promise of miles and points – and it delivers.

Conclusion

The right type of points, combined with a basic understanding of transferable currencies and loyalty programs, can open up a whole new world of travel.

For some, that means travelling more often. For others, it means travelling better. Either way, miles and points will get you there faster – and unlock experiences that might otherwise be out of reach.

There are plenty of details to work through, and we'll cover them throughout this series. But here's the key takeaway: the more you put in, the more you'll get out.