BMO Rewards: Maximizing Your Points

Recently, BMO Rewards has ramped up its marketing efforts, often providing customers the opportunity to enjoy some of their credit cards free for the initial year. The appeal of waiving the annual fee for a premium travel credit card is evident, but how does the BMO Rewards program stack up?

BMO Rewards includes several program features, but it does come with its limitations. Additionally, the process for redeeming points can be somewhat misleading. This isn’t to say the program is ineffective; understanding its intricacies allows you to fully leverage your rewards. In this guide, we’ll delve into how you can maximize your benefits with BMO Rewards.

Value of BMO Rewards Points

To acquire $1 in travel, you need to spend 150 BMO Rewards points, translating to a value of about 0.67 cents per point. This figure represents the peak value available in the BMO Rewards program and can be disappointing compared to similar programs that equate 100 points to $1 in travel. Therefore, it’s essential to consider this lower point value when evaluating the earning potential of BMO Rewards cards.

While redeeming points for travel yields the best returns, it’s crucial to explore other redemption options to assess their value.

Redemption Type	Redemption Value
Travel	0.67 cents per point
Investments	0.67 cents per point
Merchandise	0.45 – 0.65 cents per point
Gift Cards	0.40 – 0.45 cents per point
Statement Credit	0.33 cents per point

As illustrated, the ideal redemption of BMO Rewards points is through travel and investments. Many users will likely opt for travel points, but, as will be discussed, redeeming for investments may yield greater returns. While gift card values vary, merchandise typically presents a significantly lower return.

Redeeming BMO Rewards Points for Travel

Recent changes to the BMO Rewards redemption system have been beneficial for consumers. Previously, travelers had to book through the BMO Rewards portal to use their points. Now, users can charge any travel expense to their BMO Rewards credit card and subsequently redeem points for a statement credit on those transactions.

This update means you can take advantage of any spontaneous travel deals that arise. Moreover, booking directly with travel partners also allows you to receive loyalty perks from programs like Aeroplan and Marriott Bonvoy.

Once your travel purchases are charged, redeem your points easily with the Pay with Points feature in your BMO Rewards account. Credits typically reflect in 3 to 5 days.

It’s also worth noting that if you utilize the BMO Ascend World Elite Mastercard for travel expenses, your travel insurance coverage will be activated for any amount spent on the card, whether cash or points. You could spend as little as $1 with your card or points, and still access comprehensive travel insurance benefits.

Redeeming BMO Rewards for Investments

A notable perk of the BMO Rewards program is the ability to use your points for investments. If you maintain a BMO Investments account, you can convert 15,000 BMO Rewards points into $100 of investments. While this redemption holds the same value as travel redemptions, consider the long-term benefits.

With every $100 invested, your potential for monetary growth is significant. If you allocate these funds into RRSP or TFSA accounts, the money can appreciate significantly over the years, with typical annual returns averaging 4 to 6% across balanced portfolios, compounded annually.

While travel redemptions offer immediate returns, investing your BMO Rewards points may yield greater value in the long haul—a prime example of delayed gratification.

Redeeming BMO Rewards for Gift Cards and Merchandise

BMO Rewards allows for point redemption towards gift cards and merchandise like many reward schemes. However, the redemption values for various merchants can vary considerably. Recent examples of gift card redemptions include:

• $25 = 6,250 BMO Rewards points
• $50 = 11,750 BMO Rewards points
• $100 = 23,000 BMO Rewards points
• $500 = 112,500 BMO Rewards points

To calculate the value obtained from gift cards, multiply the dollar amount by 100, then divide by the point requirement. For instance, for a $50 redemption: (50 x 100) / 11,750 = 0.43 cents per point.

Each merchandise item carries a distinct value, and typically, redeeming points for merchandise provides a lower return compared to travel-related redemptions.

Redeeming BMO Rewards for Cash

BMO Rewards offers the option of redeeming points for statement credits, effectively converting points into cash. For every 15,000 BMO Rewards points, you will receive a $50 credit, allowing redemptions in increments of 15,000 points, leading to values of 0.33 cents per point—substantially lower compared to travel redemptions.

Credits will usually be reflected in your account within 3-5 business days and are applicable only to the primary cardholder.

In general, it’s advisable to avoid redeeming your points for gift cards or statement credits unless you’re facing financial challenges, as better values exist with travel rewards.

Do BMO Rewards Points Expire?

BMO Rewards points do not expire as long as you maintain an active BMO credit card that accumulates these points. When contemplating account cancellation, ensure you redeem all points beforehand. If travel redemptions aren’t feasible, consider using points towards gift cards or statement credits.

Comparing BMO Rewards to Other Programs

BMO Rewards bears similarity to Scotia Scene+, as both programs allow point redemption for travel-related purchases. However, BMO Rewards lacks a fixed point flight system seen in programs such as RBC Rewards, CIBC Rewards, and American Express Membership Rewards. Despite this, BMO Rewards remains competitive, offering numerous benefits, including:

• No blackout dates
• No minimum redemption requirements
• Insurance coverage that applies to award redemptions with the BMO Ascend World Elite Mastercard

Nonetheless, a significant aspect missing from BMO Rewards is the lack of transfer partners, a feature that some banks provide—unlike RBC Rewards, which allows transfers to WestJet Rewards, or American Express with Aeroplan and Marriott Bonvoy partnerships.

How to Earn BMO Rewards Points

Accumulate BMO Rewards points simply by using BMO Rewards credit cards. Earning points is easiest through welcome bonuses and regular spending.

BMO offers a variety of cards for earning BMO Rewards points, encompassing both consumer and business accounts. The BMO Ascend World Elite Mastercard (previously the BMO World Elite Mastercard) stands out as a leading choice in Canada, though several alternatives exist. Below are a few options:

The BMO Ascend World Elite™* Mastercard®* is frequently cited as one of the top travel credit cards in Canada, thanks to its attractive signup bonuses and benefits. Earning 3 points for every $1 spent on travel, dining, and entertainment, alongside 1 point per dollar on all else, is exceptionally generous.

The Mastercard LoungeKey membership paired with four complimentary annual airport lounge visits is a tremendous advantage, providing a value exceeding $250. A lesser-known benefit is that you only need to charge a fraction of your travel expenses (even as little as $1) for the card to activate included travel insurance.

BMO Eclipse Visa Infinite* Card

The BMO Eclipse Visa Infinite* Card stands out for its enticing welcome offer and increased earning potential. Although earning more points is favorable, it’s crucial to assess the actual value of those points. With 5 BMO Rewards points per dollar on eligible dining, groceries, gas, and transit, you achieve a real value of approximately 3.35 cents per point. That being said, you might find alternatives like the Amex Cobalt card to be superior.

The BMO eclipse Visa Infinite* Card also offers a more advantageous redemption value when compared to standard BMO Rewards: you can redeem 200 points for $1—instead of the common rate—which corresponds to 0.50 cents per point. Note that there is a higher-tier variant of this card known as the BMO Eclipse Visa Infinite Privilege card.

BMO Rewards® Mastercard

If the BMO World Elite™* Mastercard®* isn’t an option for you or if you wish to avoid an annual fee, the BMO Rewards® Mastercard represents a solid alternative. The sign-up bonus can reach 10,000 BMO Rewards points, and you earn 1 point per dollar spent—2 points at participating rental car locations. The additional purchase protections and extended warranty features are valuable perks, particularly for a card without an annual fee.

In Conclusion

My assessment of BMO Rewards is largely favorable, even though it might not top the list of travel rewards programs in Canada. While it may not lead the pack among major banks, the BMO World Elite Mastercard enables effortless point accumulation. Furthermore, redeeming points is straightforward, given that there are no blackout dates or minimum redemption requirements.