Canada’s best credit cards 2012

MoneySense presents the most sophisticated credit card ranking system in the country. We’ll help find the perfect card for your lifestyle.

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by

From the September/October 2012 issue of the magazine.

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Woman With Shopping Bags Wearing High Heels

Everyone who uses a credit card comes out a winner or a loser.

People with a good handle on their spending benefit from the rewards and perks provided by their cards. However, those who aren’t good at living within their means and managing money can quickly end up mired in high-interest debt that grows faster than it can be paid off.  Adding to the confusion is the fact it’s very difficult to know what your reward points are actually worth.

For the second year in a row, MoneySense has cracked the code for our readers, revealing the true value of these mysterious reward points and special interest rate offers. We’ve spent the summer wading through endless pages of fine print and doing calculations on more than a hundred credit cards. The result is the definitive list of the best credit cards in Canada today.

You’ll learn which cards offer the most cash back, the best travel rewards and the most merchandise. We also show you our top picks if you carry a balance, or if you’re a business owner. And for the first time this year, we look at the best cards for post-secondary students.

Unlike many credit card rankings, we don’t just look at a card over one year, an approach that would likely put the card with the sweetest sign-up bonus on top. Instead we take a long-term view, factoring in sign-up bonuses, rewards and fees over five years. Many cards offer extra rewards when you spend on gas, groceries or travel, and we’ve included this in our calculations. We’ll show you the precise value of your reward points based on your spending level, and even reveal the true rate of return for each of our winning cards.

We’ve also updated our customized Credit Card Selector Tool. The tool asks you a series of questions to find the best card that fits your lifestyle.

When you’re searching for a card, remember to look at the whole package: insurance benefits and other freebies can provide extra value. If you pick the right card for you—and pay it off each month—you’ll come out a winner in the credit card game.

To get started, just answer the questions in the Credit Card Selector Tool or watch our video demonstration. It will help you quickly narrow the field and make sure you don’t choose the wrong card category to begin with. For instance, if you carry a balance on your card, you probably shouldn’t even consider getting a rewards card. Thanks to the 19% interest rates on such cards, you’ll likely pay much more in interest every year than you get in rewards.

Whatever card you get, remember that credit cards are just a tool. If you use them wisely and never carry a balance, you can get valuable rewards to help your dollars go farther. But if you don’t pay them off, you’ll be the guy who’s helping to pay for someone else’s free flight.

See our methodology here.

55 comments on “Canada’s best credit cards 2012

  1. Thanks a lot for this helpful tool. I am in the market for a new credit card and this article was instrumental in narrowing my choices. Keep up the good work and i"ll continue to subscribe!

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  2. Where is the new Scotia Momentum Infinite card? I'm interested to see how it ranks amongst the cashback cards.

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  3. Is it possible to filer the cards by credit card company? I'm looking for VISA cards only. Thanks.

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  4. I don't see any mention of the American Express Starwood Preferred Guest credit card. Besides hotel rewards, points can be transferred to many frequent flyer programs. Card gives 5000 bonus flyer points for every 20000 SPG points transferred.

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  5. how about walmart mastercard 1% all purchases 1.25 at walmart

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  6. Thanks to everyone for your interest in our new credit card tool.

    Bill: Regarding Scotia Momentum Infinite, it came in 6th overall in the general cash back category (when we average the results for various spending amounts). Tom: You can't filter by type of card unfortunately. David and Chad, we looked at about 100 cards for this tool, but we did not look at the American Express Starwood or Walmart MasterCard.

    cheers, Sarah

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    • Too bad about missing the Walmart card. If you spent $500, $1000, or $4000 per month, it would give you $60, $120, or $480 per year, placing it in the top 5 listed in the issue, not including bonus sign-up and paperless billing rewards. If you spent all of that money at Walmart, as I do, it would be $75, $150, and $600 respectively, putting it at the top in all 3 comparisons.

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  7. Why wasn't the American Express Costco Platinum Cash rebate card reviewed? It provides a rebate of 1% up to $5K in purchases and 1.5% thereafter.

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  8. I don't notice some of the other nuances of credit card choice. For instance, I have a TD Visa Travel Infinity card, with a co-card for my wife. Annual fees are $120 for me and an additional $50 for my wife – HOWEVER, we have never paid these amounts. I also have a chequing account with TD that, if I maintain a $5000 balance, waives all my fees on all my personal accounts – including the Visa card amounts. Basically, I am getting two cards for no fee (other than forgone interest/investment income). Couple the credit card fee savings with no fee on my chequing account, free safety deposit box, free certified cheques, free travellers cheques, etc., etc., I have a pretty good deal. I would be interested to know if any of the other credit card offering organizations have similar deals.

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    • I think most of the Financial Instituion cards do. Your not going to see those benefits with the retail cards or Cap one, Amex ect.

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  9. Rather than going through the tool, is there a way to simply list the 100 cards that were reviewed, along with the calculated returns for each one, and for each spending level ?

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  10. erick, I couldn't agree more. I too have a TD First Class Infinite Visa card as does my wife. We also keep the minimum blance in our chequing account and pay no fees and enjoy the other benefits you mentioned. The points are very easy to use – book your travel with anyone and claim the rewards and it shows up as a credit on your Visa! I've seen this ranked as the best card in Canada in some other comparisons. Although I appreciate the tool, I think its got some serious flaws in methodology and people should not be making decisions solely on this tool.

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  11. re: Best Business Travel Cards. I have had the CIBC Aerogold Visa for Business Card since 2003 @ an interest rate of 16.9%. I called CIBC today to inquire about the 10.9% rate in MoneySense magazine & was told they are not able to lower rates. I could however, take a new card with a lower rate (& no travel points) or reapply for the same card I have now but no guarantee of getting the 10.9% rate. My credit rating is excellent & while I do carry a balance, I make large payments monthly. Does anyone actually get the 10.9% rate they advertise??

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    • Great point Karen. I'd be interested in hearing from other people as to whether they are actually able to get the interest rates advertised on these cards.

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    • RE: Aero gold CIBC its a consumer money racket . Also Aeroplan you cant redeem your points an I have same cibc aerogold an my interest is 19.99%/21.99%- just the way this world makes money lol! Im goin to change my cards to no fee ones as the banks get enough interest from all an as the warning say an others an NO I dont think anyone does get 10% an I pay my card in full plus interest every month. such as life …

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  12. I was excited and thankful to find this article in the latest issue and read it with great alacrity as I've often wondered how valuable the card I was using (PC Financial MC) stacked up against others in the market. Well, in lieu of many free groceries ($2000 worth at present) my curiosity was abundantly satisfied and thanks to the rigorousness of the study gave me the confidence to go ahead and replace my existing card with another (CapitalOne Aspire World MC) which topped in value the categories of my interest. Strangely, however, the only card available in Canada from CapitalOne which most closely matches my choice from the article in appearance and features and specs is in fact named CapitalOne Aspire Travel World MC. I confirmed that it is the only card allowing the conversion of travel miles back to cash, and so forth, but it took an inordinate amount of time for the rep to ascertain this was the correct card relative to the article. In spite of this inconvenience I was happy to learn that it included additional coverage and insurances not mentioned in the article. Thanks again, Phil and Sarah. Cheers.

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  13. The article obviously took a great deal of work to put together. However, I was disappointed to discover that, in the cash back category, important information was overlooked. For example, many of the highest rewarding cards only offer the big bucks for elegible purchases (ie gas & groceries), and offer lower rewards for other purchases. Worse than that is the fact that you have indicated the scotia momentum infinite has a $0 annual fee, when in reality it is the most expensive of scotia's momentum cards. I am left wondering if i can use the tables at all to make a choice relevant for me.

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  14. I looked at the TD Visa Travel Infinity card that has been mentioned above. On the website, it says $10,000 of purchases equals 30,000 points which equals $150 off travel. So you basically get $150 on $10,000 of purchases. So about 1.5%?? That's really not that fabulous. Am I missing something with this one? I have free banking,etc with President's Choice so that would not be a draw for me.
    Regarding the Capital One Aspire Travel World MC – on their website, they are pretty firm that to make the annual fee work out, you should be spending about $2000/month minimum. However, the Moneysense article makes it seem like even $500/month would be benefitical. I've tried to think about why – perhaps it is the five year period they used to do the calculations? Maybe if you were spending about $1000/month over more than five years, the annual fee would start to erode your free travel? There are all sorts of big sign-up bonuses that of course you wouldn't be getting except in the first year – perhaps that is what is making it so favourable on this five-year study? The website says to get $150 in travel, you need 15,000 reward miles. For each $1 you spend, you get 2 reward miles so that is about 2%. That's exactly the same as the President's Choice m/c – they give 2% and no annual fee. So there's my answer! And the PC M/C has no yearly fee, but the Capital One has a $120 fee. I don't understand how the Capital One Aspire Travel World m/c is showing up so favourably – are the inital bonuses that valuable??

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  15. Hi Eden, Thanks for your interest in our credit card tool. In short, yes, the Capital One Aspire card has some very generous sign up bonuses. Please remember that fees are factored in, as well as extra earnings for some cards in certain categories, so it can get quite complicated.

    cheers, Sarah

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  16. Did the study happen to look at the WestJet RBC credit card? If so how did it rank against the others? Thank you!

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    • Hi Stacey, We didn't look at the WestJet card. We have gotten a few enquiries about it, so if we do the ranking again next year I would like to include it. cheers, Sarah

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  17. Did the study consider the TD First Class VISA infinite, or the RBC Avion VISA infinite travel reward cards? I've had a CIBC Aventura VISA infinite card for some time, but they are heavily promoting cardholders convert their Aventura VISA card to a Aventura World Mastercard.

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    • Hi Brian,

      Yes, we did look at the TD First Class Visa Infinite and the RBC VISA Infinite Avion. They were not good enough to make our top travel card list. Overall, CIBC Aventura World MasterCard came out better than CIBC Aventura Visa Infinite, but they are both good cards.

      cheers, Sarah

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  18. Regarding Eden's comments about the PC Financial MC: naturally, banking considerations are irrelevant when there's no annual fee on the associated card and the products are not interdependent but when you compare this with a card such as the CapitalOne Aspire World with a $120AF the one-time start-up bonus does make a huge difference whether factored over 5 or even 10 years. But even barring this bonus, the CapO card outpaces the PC (1% cash back) at less than $1000 monthly and breaks even with the new black PC MC (2% cash back on PC purchases) just above $1000 monthly, when you factor in less than a quarter of those monthly charges as PC purchases. And it may be worthwhile when you consider the plethora of insurances not included with the PC card and the option to utilize those rewards as travel discounts which are more valuable than cash or grocery amounts. No other travel cards yield such value except possibly when they're associated with bank accounts which cancel out fees but the value therein varies and depends on a number of other individual factors.

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  19. The tool in this article is excellent! The fact that it provides the readers with an easy way to find out which credit cards will work best for them will definitely narrow the chances of them filing with bankruptcy in the future. A lot of problems regarding bankruptcy stem from people having credit cards that they are uneducated on, or simply ones that don't fit their lifestyle. Awesome article! For those of you who weren't as fortunate to have read something like this years ago, check this out…it has great information. http://www.personalbankruptcycanada.ca/blog/consu

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  20. I think one of the questions your tool should ask is what bank you use since I did my own comparison before choosing cards and the TD First class Visa Infinite was the clear winner for me since I have always banked with TD and carry the $5k balance so I pay 0 fees for banking and credit cards. Its nice to go to one website and see your bank and credit card balance too.

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    • I hardly consider loaning the bank $5000 interest free infinitely is akin to not paying any fees. Here is my free advice to everyone who keeps $5000 dollars in an account to 'waive fees'. 1. Open a line of credit. They are 100% free, no overdraft fees, lower 'overdraft' interest and no minimum balances. 2. Put your 5k into TD stock and collect dividends quarterly. If you are 30 now and pay fees until you're 60, there is no risk in this investment and will most likely average you about 6% gross conservatively. 3. Go get some no fee credit card with some cash back option. 4. Do the math. You're welcome!

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  21. TD First class Visa Infinite was the clear winner for me too, as I also don't pay annual fees and now you can use points on expedia.com to pay for flights, hotels, anytime anywhere including the taxes.

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  22. The comparison lists an "Aspire Cash World MasterCard" with a $0 annual fee but the only one I can find is the "Capital One Aspire World MasterCard" that has a $120 annual fee. Does anyone know where to find the $0 version?

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  23. Where did the RBC Avion card rank in the travel rewards catagory?

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    • I would like to know the answer to this also.

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    • where did RBC Avion card rank? Should I be switching banks?

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  24. Hi Roslyn,

    We did include this card in our study but it didn't make the top ten.

    yours truly, Sarah

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  25. Used this and was pointed to the Capital One Aspire Cash World card. I was approved. Confirmed no annual fee, but credit limit is only $3000 despite having met their $100K minimum income requirement and having only 1.5% debt. I indicated $4000 on the credit card selection engine from MoneySense. According to Red Flag Deals, most applicants received $3000 limits as well. This card is useless to me for travel purchases until they raise my credit limit, and yet it is suggested as a travel card.

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    • I applied to capone and received a $20,000 limit. We have a ridiculous amount of credit history (our last card had a $37,000 limit, so they are pretty strict in their way).

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  26. Hello: I enjoyed looking over the article. The only thing was i wasn't sure the section of card deals included everything the credit card offered or just highlights like extended warranty.

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    • Sorry I meant to write that I was unsure that the section on card details included everything the credit card offered or just highlighted some of its features.

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      • In most cases it's a highlight of the best features a card offers. For full details, contact the card issuer.

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  27. I like the idea of having a credit card issued by my bank, e.g. RBC, so the balance of all my accounts show up in one place. For this reason I have the RBC Avion Visa card. Its rewards seem quite generous. Why can't you tell me what ranking this card was given?

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    • Hi and thanks for your comment. Although we rank the top 100 cards in Canada, we only publish the top 8 in each category. You can find the results in the September/October issue of the magazine, "What Would Buffett Buy?" It's on newsstands now. The Credit Card Selector Tool on the other hand provides a list of the top 5 cards that, according to our methodology, best match your spending habits. If your card is working for you than great but our objective here at MoneySense is to show you what cards might work even better.

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  28. like to see a category for people who spend less than 500 a month

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  29. The three things that should be considered when choosing a credit card is how often you plan on using the card, what you plan on purchasing with the card and if you plan on keeping a balance on your card. After answering these questions you will have a better understanding as to what is best for you rather than chasing the card with the most reward points.
    http://www.ingeniousinvesting.com

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  30. where does the walmart mastercard rank on merchandise back?

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  31. In your article, especially to do with travel cards did you take into account the ease of booking or blackoutdates, airline restricitons ect. because that is very important for a user?

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  32. If trip cancellation insurance is important to you, beware of CIBC Aventurn World Mastercard.

    My main reason for getting CIBC Aventura World Mastercard was the Trip Cancellation insurance. But sadly after calling the insurance provider twice, both times they confirmed if we miss the first leg of a trip, the trip will not be covered. For example, we are flying to catch a cruise, but if we miss the initial flight due to reasons such as weather, this is not consider trip cancellation and there will be no coverage for missing the cruise.

    Imagine our surprise, every credit card company's trip cancellation insurance provides coverage for missing the initial leg of a trip but not CIBC. We ended up paying extra and buy a separate Trip Cancellation insurance. This leaves a very bad taste in my mouth.

    I will be cancelling this card. What make a bad situation worse is that we just bought a dishwasher and was counting on the extended warranty protection. Now we will also lose all our extend warranty coverages after we cancel our card. Read the fine prints, then call the insurance number to see for yourselves.

    I posted above to the card's review website. They rejected my review for the following reasons:
    Your review was inappropriate
    Your review was a customer service issue

    Talk about skewing the results, no wonder they have such good review on their own site.

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  33. how come i never see the cibc drivers edge mastercard listed in the list of credit cards Ron w

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    • The Driver's Edge mastercard (originally offered by Citibank and now by CIBC) is a great card if you have any plans in the future of buying a new or used car, truck, or motorcycle. It pays back 2% on absolutely anything you buy to go towards your next vehicle. I have had mine since early-2004 and it has already sent me cheques totalling more than $8200 to offset the costs of several vehicles I have purchased over that time. This was based on average monthly charges of around $3600 and I use it for everything possible. It used to be even better because there was no annual fee but as of this spring there is now a $59 annual fee – but it's still a good deal. Being a platinum card there are also other perks that go along with it such as buyer's insurance, etc. Other people may prefer air travel cards but the way I look at it money saved is money saved no matter what it's directed towards. However, if you have no plans to ever buy a vehicle then this is not the card for you.

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  34. Excellent piece of the writing shared about best credit cards info that is so awesome. After reading this post about credit card, I have found out lots of instruction and this will be useful for using best credit card. I like this valuable post. Keep on this info !

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  35. A big thank dude for posting this instructions about the transferring all sorts of investments into a TFSA. Actually I am so inspired to get this instructions of TFSA. I always support such type of informative blog and this is so supportive to us all. Take it up and inform like this…

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  36. I'd like to read more updates regarding credit card tools. I've also applied for a new credit card recently…I hope your stuff will help me here so much.

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  37. Nice tips that should be considered before choosing credit cards..I'm just new while applying for credit cards. I hope your tips will help me here so much.

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  38. nice tips.travel credit cards are awesome =)

    Reply

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