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Capital One Aspire Cash World and Aspire Platinum Review

Late summer 2011, Capital One added two new MasterCards to the Aspire family, to replace their old tiered cash-back reward cards. These include two new versions: World and Platinum. Both are purely cash-back cards, with no tiers, earning limits, minimums, or annoying restrictions that many other cards have.

Aspire Cash™ World MasterCard® (Discontinued)

  • Earn 50% extra cash rewards every year and pay no annual fee!
  • Earn 1% cash rewards on all purchases
  • Earn a $100 bonus cash reward on your first purchase
  • No annual fee
  • Annual interest rate of Prime +16.8%
  • Please Note: A requirement of this card is a minimum personal income of $60,000 or household income of $100,000.
  • No limit to the amount you can earn
  • Add an authorized user for $0, and earn even more cash
  • Valuable World MasterCard benefits including Purchase Assurance and Extended Warranty
  • World MasterCard Benefits include:
    • Travel Emergency Medical: 22 days if younger than 65, otherwise 8 days.
    • Other insurance includes: Travel Accident Insurance ($500K), car rental insurance, flight delay, trip interruption/cancellation, baggage loss, baggage delay
    • Price protection: $100/item if a lower price is found in 60 days, up to $500/year
    • Extended Warranty: Doubles manufacturer’s warranty for up to TWO additional years (typically 1 year with other cards).
    • Purchase Assurance: Insures most purchases against theft, loss or damage for 120 days (typically 90 days with other cards).

Aspire Cash™ Platinum MasterCard®

  • Earn cash rewards and pay no annual fee!
  • Earm 1% cash rewards on all net purchases
  • Get 25% extra cash rewards every year
  • Get a $50 bonus cash reward on your first purchase
  • No limit to the amount of cash you can earn
  • Annual interest rate of Prime +16.8%
  • Valuable Platinum benefits, including Purchase Assurance and Extended Warranty
  • Add an authorized user for $0

And for the sake of comparison, here are the details of the Aspire Travel™ World MasterCard® that I reviewed last year:

Aspire Travel™ World MasterCard®

  • Earn more reward miles – on everything you buy!
  • Earn 2 reward miles for every $1 – on all purchases
  • Get 35,000 bonus reward miles with your first purchase
  • Get 10,000 anniversary bonus reward miles every year
  • Redeem for travel, cash, merchandise and gift cards
  • World MasterCard benefits, including Travel Emergency Medical Insurance and Trip Cancellation Insurance
  • Add an authorized user for $0

Please Note: A requirement of this card is a minimum personal income of $60,000 or household income of $100,000.

While this is considered by some as being a “travel card”, it really is just a 1.5% cash-back card that gives you 2% cash-back to those who travel occasionally and are willing to save up 60,000+ miles. Because you even get to keep the miles on travel that you charged and redeemed for, the total reward is really a 2.02% return (not counting the annual fee and bonus).  You can read my full review of the Aspire Travel™ World MasterCard® here.

Eligibility

All of these Capital One cards have a interest rate of Prime + 16.8%, and thus are a very poor option for people who carry a balance. For the World level cards, Capital One says they are “a good choice for personal income of $70,000″, but this isn’t a strict requirement, as other factors are considered in the approval process.

Many people have applied for the Aspire Travel™ World MasterCard® with income lower than this, and were approved. If your income is much lower though, your spending might not even be high enough to justify the annual fee that the World level cards have. The suggested personal income for the Platinum card is $30,000 which probably means that anyone with a job and good credit could be accepted.

For those who already have a Capital One card and want to switch to one of the new ones, you’re unfortunately going to have to re-apply and then cancel the old card. The downside is that your credit history will show a cancelled card and there’s a hard credit check when you apply, but shouldn’t affect your score a whole lot.

The upside is that you will get the sign-up bonuses, which would normally not be given to existing customers. If you have existing rewards, they can be transferred to the new card. A representative from Capital One said they are working on a better process for switching cards, but I was told the same thing a year ago.

How do these cards compare to each other?

Ever since Capital One eliminated the annual fee on the Aspire Cash World card at the end of March 2012, it’s been a no-brainer as to which version is better. Who doesn’t want a higher return and great benefits for no extra cost? The Platinum is really only there for those who can’t qualify for World.

If you use Aspire Travel™ World MasterCard® only for cash-back, it returns 1.5% but its anniversary bonus will only pay for $75 of the $120 annual fee, so in this case you’re still better off with the Cash World. However, if you use Travel World for redeeming travel expenses, then you get a 2.02% return and $100 off the annual fee. The point where the extra 0.52% reward is worth paying the annual fee occurs when you redeem, on average, $177 per year in travel expenses – but being careful of the tiers to ensure you get at least close to the maximum return. For example, lets say you were to spend $20K per year on each card, and you travel once and it costs $333 or some multiple of this number.

On the Aspire Cash World, you get $200 plus an anniversary bonus of $100. With Travel World, you get 40000 miles plus 10000 miles bonus, you redeem 35000 of them to get a credit of $333, and redeem another 13333 for $100 cash-back. After paying the annual fee, that leaves you with $313 reward and 1667 miles leftover (worth at least $12.50 in a future year). So you’re effectively ahead of the Cash World card by $25 just from that one travel redemption which wasn’t even done at a full 2%. And if you spend $30K per year and have a $650 flight, the difference increases to $117! It really all comes down to how much you travel, and whether you’re willing to save up your miles and redeem them for the maximum benefit.

How do these cards compare to cards from other banks?

The question of “what is the best cash-back card?” used to be answered with quick replies of “MBNA Smart Cash“. Getting a non-tiered 1% cash-back with 3% on gas & groceries, all with no annual fee, is pretty hard to beat. But the Aspire Cash World is also no-fee and has a net annual return of 1.5% on all purchases. So comparing these two is going to depend on how much you spend on gas & groceries.

For those whose total annual spending is under $29000, if 25% of your expenses are on gas & groceries (and don’t exceed $600/month), then the annual cash-back works out to the same. More than 25% favors Smart Cash, and under 25% favors Aspire. Over $29K spending will always favor Aspire Cash World no matter what percent is spent on gas & groceries, due to the $600/month cap on Smart Cash.

If you don’t qualify for Aspire Cash World, the break-even point on the Platinum version vs Smart Cash is when 12.5% of your credit card spending is on gas & groceries. Adding to the mess is another card that may appeal to large families or those with expensive prescription drugs: the Scotiabank Momentum VISA Infinite. To choose the best card for your level of total spending and gas/grocery spending, use the following formulas to see which one gives you the highest reward per year after accounting for the annual fee and bonus:

a = annual spending on the card,

g = monthly gas & grocery spending, but do not use higher than 600 for MBNA

d = monthly drug store purchases and recurring bill payments

Aspire Cash Platinum: (a × 0.0125)

Aspire Cash World: (a × 0.015)

Aspire Travel™ World MasterCard®: (a × 0.015) – 45

MBNA Smart Cash: (a × 0.01) + (g × 0.24)

Scotia VISA Infinite: (a × 0.01) + (g × 0.36) + (d × 0.12) – 99   Note: Subtract another 30 if you want a supplementary card.

Aspire Travel™ World MasterCard® used for travel: a × 0.0202 – 20

Other cash-back cards, like the CIBC Dividend Visa and Costco Amex, have tiered rewards and produce a lower return than the Aspire cards. But if you know of another card that can outperform the ones above, please mention it in the comments!

Card Combinations

So far, these cash-back cards have only been evaluated as being used alone. Some people are willing to carry two cards around and use one for gas & groceries and the other for everything else, in order to maximize their rewards. Usually the best combination is MBNA Smart Cash with one of the Aspire cards. But Scotia’s card will outperform Smart Cash if your gas & grocries regularly exceed $825 per month and/or you spend a lot at drugstores or on recurring bills. For example, the two are equal at $600/month g & g and $225/month drugs & bills. These calculations assume no supplementary card.

Conclusions

People would have to spend a lot on gas & groceries in order to see MBNA Smart Cash outperform the new Aspire Cash World card, but both used together is even better. There are also quite a few people who have considered the Aspire Travel™ World MasterCard®, but decided that 0.52% extra wasn’t worth the hassles of having to save up points and redeem them on travel. They will be very happy to see a pure cash-back card with a 1.5% return and tons of insurance benefits.

Check out how these cards stack up against other no-fee cash back credit cards in Canada.

About the Author: This is a guest post by Elbyron – A credit card rewards fanatic who can be found on the many personal finance and deals forums around the web.







22 Comments, Comment or Ping

  1. 1. Chris Foley

    Great article! You must have read my mind.
    I have been using RBC Infinite Avion VISA ($120, plus $50 for the second card). I spend over 100k on the card each year for my business and we have PC Mastercard (which they just introduced another card with 2% for items bought at Loblaws in addition to the 1% everywhere else) for personal purchases.
    But, I am contemplating switching cards for the business. I would like to know the best fit, I usually spend $120 on gas and nothing on food with the RBC VISA. We do travel to Florida every two years or so (4 of us). But, I would be open to a cash back card it if it made better sense.

  2. 2. Mike

    Wow, what a great detailed review of cash back credit cards and the new offerings from Capital One.

    As with most rewards credit cards, if you spend under $2k a month it probably makes sense to just stick with a no-fee card that’s tailored to your spending habits. If cash back is your flavour, you can’t go wrong with the MBNA Smart Cash card. It’s once you start spending $3k or more each month on your card that the options get a bit tricky.

    The Capital One Aspire World MasterCard beats the Smart Cash card once your spending reaches a certain threshold (I think you said $33k/yr). And the nice thing about this card is the versatility to use the points for travel or convert them to cash.

    All in all, these are terrific offerings from Capital One for the savvy rewards cards user. Great review!

  3. 3. Big E

    Great review! One question though – how does a cancelled card affect your credit rating?

  4. 4. Darcy Guy

    Great detailed review. I’ll probably stick with my MBNA card as I try to limit my credit card use so the transactions aren’t high enough to warrant a change. Filtering the majority of transactions through a CC for rewards can make sense but I wouldn’t recommend if your budget is tight. Whenever, I’ve tried I end up carrying a balance which destroys the reward benefits pretty quickly.

  5. This is a really awesome review Elbyron and I agree with every word that you said!

    Right now I’m rocking the Capital One Aspire World combined with the MBNA Smart Cash and I think it is going to be a good combo. I really love the great insurance and decent rewards offered by the Aspire World and the high payout on gas and groceries on the Smart Cash. The annual bonus on the Aspire card is enough for me to probably keep it after the first year just to keep the insurance active and to have that level of insurance available when I need.

    Unfortunately, many travel rewards card offer much more than 2% return, especially for those of us who live in and fly out of remote locations like me. I’ll still be signing up for premium cards whenever good sign up bonuses come along and the Aspire card will probably take a back seat to them every now and then.

  6. 6. Sam

    Thanks for the info. I actually applied for Capital One credit card some time back but didnt get through because they said that I have poor credit. So can any one here kindly explain me what is the difference between ordinary credit card and a cash back credit card when it comes to approval process. I know the basic difference, but want to know if cash back credit cards are easy to apply or not. Pls help.

  7. 7. Glenn

    Capital One…Frustrating to deal with.

    Last year I applied for the Capital One Aspire World Mastercard and got rejected. The problem was I was unable to get any reason for why I was rejected. I have a VERY good credit history but I do have 2 other credit cards with limits over $40,000 (which I use for business) and pay all my balances in full every month. I was willing to cancel one of these cards if that was the issue but in-spite of multiple attempts, I could not get ANY explanation from Capital One only generic comments of “possible” issues with my credit history…I ended up paying for an on-line credit report on myself just in case there was fraudulent activity on any of my accounts.

    As this card has trip cancellation insurance which can be very expensive, I applied again this year and got the card with a $5,000 limit. I’ve had the card for a few months but hit my limit last week. I called and asked to get the limit increased (as I mention, I pay my balance off in full every month). Apparently, Capital One does NOT accept customer requests for credit limit increases. They will only “pro-actively” monitor accounts and offer credit limit increases if they feel like it.

    So… good card with good benefits. Difficult company to interact with. Unless I am “selected” to be offered a credit increase, I will likely not renew this card next year.

  8. 8. Diane D.

    Thanks for this blog. Especially appreciate the comparison of cash-back cards.

    Has anyone discovered a card issued in Canada that has no foreign transaction fees? This is a fee, usually 1-3%, over and above the exchange rate, applied to purchases made outside of the country where the card is issued.

  9. 9. Sam

    @Glen – Thanks for your long answer. I appreciate it. Definitely I will have to deal with this limits problem as well !

  10. 10. Elbyron

    @Sam
    Most reward cards have eligibility requirements that include a good credit score. It’s impossible to say what the required score is, and also the score is only one of many factors that they consider. Your best bet would be to try applying for cash-back cards with several different companies (one at a time) and see if you can get one anywhere. If not, you’ll have to stick to the non-reward cards designed for those with below average credit, until you can improve you score (which is done by consistently paying your monthly balance in full).

    @Glenn
    I agree that their credit limit increase policy is stupid. I’ve had their cards for 2 years and have never been offered an increase, but my initial limits were way higher than I’ll ever need. If you know you’ll be making big purchases in a given month, try making an early payment to the card to clear the balance first.

    @Diane
    None of the major banks offer cards with no foreign transaction fees. Some banks may try to hide it, but those fees are there (a huge lawsuit about 5 years ago dealt with hidden forex fees that were not being mentioned in the card’s terms & conditions). The typical rate is 2.5% above the rate supplied by Visa or MasterCard. There are some credit unions offering cards with lower fees. The Financial Consumer Agency of Canada has a helpful chart to see what each bank charges: http://www.fcac-acfc.gc.ca/eng/resources/Publications/paymentoptions/servicefees/CCSerFeesTab-eng.asp
    For Americans it’s much easier to get these cards, in fact most of Capital One’s US cards feature no foreign transaction fees. It’s too bad that this hasn’t become more common in Canada.

  11. 11. Rog

    So can someone confirm that the previous cash back card “Cash Back Platinum” with $99 annual fee no longer is available????

  12. @Rog, yes, I believe the Aspire Cash World replaced the old $99 card.

  13. 13. CMT Chuck

    Hello Diane D,
    i have been very happy with the BMO mastercard in US dollars….I use this only in the US and pay bill in US $, thus saving the 2.5% fee

  14. 14. Elbyron

    @Chuck & Diane
    If you have a source of US dollars (like trading USD denominated stocks), using a US$ credit card is a great way to save on the exchange fees. Of course you also need a USD bank account to hold the funds with which to pay the USD credit card. And often both the account and the card will have fees. My preference is the TD Borderless account which includes a free USD MasterCard (and free supplementary card). The account costs $5/month but is free if you keep a balance of $3000 or if you have Select service. The main reason I went with TD’s Borderless is because they have the best exchange rate you can get for smaller amounts (about 1.25% above nominal rate), and though I maintain funds in both currencies, I do need to convert now and then.

    The BMO USD card is nice too, because if you spend over $1000 in a year, you don’t pay the annual fee for the following year. Other good USD cards were recently reviewed by FrugalTrader:
    http://www.milliondollarjourney.com/top-us-dollar-usd-credit-cards-in-canada.htm

  15. 15. Bob Orchard

    I think the CIBC Drivers advantage card is much better. It replaces the old similar CITI Bank credit card. CIBC charges $60 per year and $0 for second card. You get 2% on everything you purchase with no limit on the amount you can earn each year. You can then take this money and use it for the purchase or lease of any new or used car. If you buy cars it’s far superior to any of the other cards … IMHI

  16. 16. Elbyron

    Sorry Bob, I have to disagree with your claims of Drivers Edge being “far superior”. Aspire World Travel MasterCard gives you 2% on everything you purchase with no limit, but after factoring the annual bonus the cost comes out to only $20/year. So just looking at reward & cost, Aspire is superior. If you look at insurance coverages, then Aspire is what I would call “far superior”. Aspire’s purchase security is 120 days (vs 90 with CIBC), extended warranty is up to 2 years (only 1 with CIBC), and it has medical travel insurance (very valuable), trip cancellation insurance, and trip interruption insurance that CIBC doesn’t offer.
    Of course there’s the significant difference that Aspire requires you to travel, and save up enough points for a $600+ redemption to get 2% back, while Drivers Edge requires that you purchase a vehicle every 5 years or start losing points. So there’s pros and cons of each reward system. While one may be better suited to certain individuals than the other, I think most people tend to travel and also buy cars, and so the best reward card will come down to annual fees and insurance.

  17. 17. Bob Orchard

    I went to the Aspire web site to see how it works but couldn’t find a simple answer on redeeming these points that are earned.
    I did see the ability to buy items with reward mils but a $50 gift card didn’t cost 5000 points but 8500 or so. Seems to me you don’t really get 2%
    on the card. You get 2 points but this may not represent 2% when you buy something. with the CIBC card 2% is a dollar amount so
    if you spend $50,000 in a year you get $1000 when you buy a car. The other benefits for the Aspire card look quite good as you pointed out.

  18. 18. Elbyron

    @Bob
    Buying items with the points is a huge waste. You don’t get anywhere near 2% doing that… and the catalog for Canadians is pretty tiny anyway. If you re-read the section of this review regarding the Aspire Travel card, or read the older review that focuses on that card, you’ll note that it talks about redeeming points for travel charges. Anytime you charge something like a flight, hotel, cruise, rental car, vacation package, or anything else that gets categorized as “Travel”, you will have 90 days from the purchase date to decide if you want to redeem points to get that travel charge credited back. To get the full 2%, you have to redeem for a charge of exactly $150, or exactly $350, or any amount over $599. This can be a bit of a hassle, but not if your patient enough to save up for a while and always redeem for $600+ charges.

  19. 19. George

    Elbyron, another great review. You mention that Canadians have few choices when it comes to cards with no FX fees. However Chase and Amazon.ca now offer a fee-free card with no added foreign exchange fee. It’s only a 1% points card, but the savings of around 2.5% on USD/EUR/GBP/etc is compelling for use while travelling. You can get one of the Aspire cards for the travel insurances, just carry and use the Amazon card during the trip for non-CAD expenses.

  20. @George, thanks for the heads up about the amazon card. That card can make a big difference for travelers.

  21. Has anyone used the Price Protection before?

    That is a long period of time (6 months) and could be a huge benefit for some items pruchased.

  22. 22. smayer97

    Since the Capital One Aspire Cash World has been discontinued, consider also the CapitalOne Aspire Travel World MasterCard as a serious contender.

    See my latest review of this here:
    http://www.milliondollarjourney.com/top-cash-back-credit-cards-in-canada.htm/comment-page-6#comment-133434

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