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Using Points & Miles to pay for Tuition Last Updated: September 17, 2015

 

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As students settle in for the school year, many are wondering how they’ll stretch their limited bank accounts. A crash course on frugality and a Masters in the art of budgetary science are prerequisites for any student hoping to avoid mounds of student debt.

The national average cost of tuition is approximately $6,000. Add in recent figures from the Canadian Federation of Students pegging the average student debt at a whopping $27,000 and it’s no wonder parents and students are stressed when it comes to financing higher education. One surprising source of financial relief is the millions of dollars worth of loyalty points Canadians are sitting on.

Until recently, there were limited options for using points to cover tuition or pay down student debt. Depending on the reward program or credit card, parents could offset tuition fees by converting their miles or points into a ‘cash back’ credit and apply it to their credit card balance. If your post secondary institution allows you to pay for tuition or school supplies using your credit card (most don’t) this could be considered a way to use points to pay for tuition. Of course a straight ‘cash back’ reward card operates with the same principle. The problem with this option is the ‘credit’ is only rewarded once per year and quickly forgotten or rolled into covering an outstanding balance. Further, most experts agree that the ‘cash back’ option comes with low redemption value and there are better ways to use reward points.

Now, thanks to an innovative program called HigherEdPoints, students and their families have a more viable option for using points for tuition. Launched in late 2013 and covered at that time by Rewards Canada (see Global News), HigherEd points is starting to gain traction.

The company currently allows you to redeem Aeroplan miles to pay for part or all of your tuition at over 75 post-secondary institutions across Canada or to pay off student debt with Student Aid Alberta or Ontario Student Assistance Program.

Here is how you can pay with Tuition with Miles & Points

Aeroplan members can help any student (family or friend) by redeeming 35,000 Aeroplan Miles for a $250 credit towards tuition. HigherEdPoints shows up as a redemption item in the Aeroplan reward catalog. When a $250 credit is purchased and unique confirmation code issued, the student, parent or donor returns with the code to their HigherEd Points account and transfers the funds to a designated participating institution on behalf of a student. Complete instructions can be found here: https://www.higheredpoints.com/how-it-works/

We recently caught up with HigherEdPoints founder Suzanne Tyson who claims the program is responsible for paying for more than $160,000 in tuition to date and has grown from an initial two post secondary institutions to 75 in just two years.

"We've seen an uptick in redemptions in the past few weeks--and an increase in the average size too. Had two (redemptions) for over $2000 this week--and a business owner converted his Aeroplan Miles into scholarships for his employees worth over $17,750(!)!" noted Tyson.

Wow. $17,750 in tuition? That's huge! That's nearly 2.5 Million Aeroplan Miles and that brings us to who might use this redemption option. The reality is not many students, especially those who are just starting university or college will have 35,000 Aeroplan Miles let alone 2.5 Million! But they have family and friends who do and that is where Higher Ed Points sees a lot of traction. Parents, Grandparents, Uncles and Aunts using their Aeroplan miles to help their kids, grand kids, nephews and nieces attend school. There are a surprising amount of Mile-ionaires within Aeroplan and many of those members have more miles than they know what to do with them. Some of them redeem for their first class or business class flights and still earn hundreds of thousands of miles a year.

As for students, if they are able to accumulate 35,000 Aeroplan miles on their own it makes sense to use the miles for tuition. Any way to pay down your tuition, reduce interest charges and avoid student debt is a good thing.


The following are a few tips for maximizing Aeroplan balances:

  1. Sign up for an Aeroplan co-branded credit card. TD, CIBC and American Express all offer various Aeroplan cards to suit most consumers needs. Some have higher income requirements so it may be your parents signing up for them and then using the miles for your tuition. Several cards like the TD Infinite Visa Privilege Card and American Express AeroplanPlus Platinum cards have sign bonuses that eclipse the 35,000 mile transfer level to Higher Ed Points which means as soon as those sign up bonuses post you can redeem for your tuition. Find details on all the Aeroplan co-brand credit cards on Rewards Canada's Credit Card comparison page.
  2. Take advantage of Aeroplan Bonus Offers. Each and every month there are dozens of bonuses for Aeroplan members. Whether it is flying on Air Canada, staying at hotels, renting cars or shopping there is usually some sort of bonus that can help boost your balance. We track all Aeroplan bonus right here on Rewards Canada on our Aeroplan Bonus Miles page.
  3. Use the tried and true method of double dipping. Double dipping is the term coined for earning miles twice in one purchase or transaction. This involves your Aeroplan mileage earning credit card (either yours or a supplementary card from your parents!) being used for a purchase where you also earn miles in the same program as the credit card. Buying gas at Esso? Using your Aeroplan Visa or American Express and then swiping your Aeroplan card ensures you are double dipping.


Stay tuned for more student tips including a closer look at the pros and cons of student discount programs!


Care to comment on Rewards Canada Guide to Points & Miles for Students? Which of these cards do you use yourself? Share you views and experiences by commenting below or join the conversation on Facebook and Twitter!

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