Canada's Best Credit Cards 2019

Canada’s Best Credit Cards 2019

Find credit cards that offer you more cash back and more rewards, based on the way you spend

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It goes without saying that finding the right credit card could save you hundreds if not thousands of dollars a year. Whether you’re looking for lower fees, higher net reward points or simply valuable perks like travel medical insurance or rental car savings, every dollar counts. If you use your credit card wisely, pay off your balance monthly and find the right rewards program for you, you’re sure to come out ahead. There’s a slew of credit card options out there, so making a choice can be perplexing. To help you find a keeper or two, MoneySense has done a lot of the heavy lifting for you.

To come up with Canada’s Best Credit Cards 2019, we tapped our credit card tool, which is powered by our partner Ratehub.ca‡. The methodology took into consideration numerous factors, including welcome bonuses, great cash-back value, rental car discounts, flexible travel with no restrictions, high cash-back value, superb insurance packages, and more. Ratehub.ca provides us with results based on their algorithms and the team at MoneySense uses that information and also makes additional considerations when determining the final rankings.

Remember, this is only a starting point. Try our tool and then do some of your own credit card research. Some of the highlights from our package include:

The best credit cards in Canada 2019

Best travel card (with a fee)

American Express Cobalt*

Year-long welcome bonus: Up to $300 in bonus points provided you spend at least $500 on the card every month for the first year.

Rack up points fast: Five points for every $1 spent on eligible food delivery, groceries, and restaurants and two points per $1 spent on gas and transit buys—including taxis, public transit, and eligible flight tickets. Earn one point on all other purchases.

Annual fee: $120 (charged monthly at a rate of $10)

Get tickets before anyone else: Get advance access to Front of the Line by American Express Invites as well as advance screenings to movies. At Ticketmaster.ca, 2,000 points is equal to $20.

Tons of travel-related benefits: Lost or stolen baggage insurance, hotel/motel burglary insurance, emergency travel insurance, flight delay insurance, and more.

Flexible: Points can be redeemed for flights on any airline anytime—with no blackout periods. Plus, points can be used to cover taxes and fees.

Click here for more details about the American Express Cobalt*

Best cash back card (with a fee)

Scotia Momentum Visa Infinite*

Great cash back on gas and groceries: You’ll earn 4% back on this spending, plus you’ll earn 2% on recurring bills and pharmacy purchases paid through the card, and 1% on everything else.

Free money: You won’t pay a cent for this card in the first year, plus 10% cash back on everything for the first three months on the initial $2,000 in purchases.

Annual fee: Just $99, which is typical for a premium card, Plus, a supplemental card is just $30.

Good travel benefits: Even though this is not a travel card, it boasts delayed and lost baggage insurance, trip interruption insurance, flight delay insurance, and travel accident insurance.

One of a kind dining and drink: Wine country discounts in Ontario and British Columbia where you can enjoy complimentary tasting, private vineyard tours, and discounts on wine purchases. Plus, access to other Visa Infinite Services (including concierge services).

Click here for more details about the Scotia Momentum Visa Infinite*

Best cash back card (no fee)

Tangerine Money-Back*

Earns great rewards: 2% cash back on two spending categories of your choice from 10 different options as well as the choice of a third category to get 2% back on if you also have a Tangerine Savings Account. Plus, 0.5% on all other purchases.

Annual fee: $0

No reward limits: Lets you earn unlimited Money-Back rewards on everyday purchases.

Automatic earnings: Monthly rewards can be applied to your credit card balance or redeemed into your savings account.

Click here for more details about the Tangerine Money-Back Card*

Best travel rewards card (no fee)

MBNA Rewards Platinum Plus MasterCard*

Annual fee: $0

Big earnings: 2 points on every dollar spent on gas, groceries, and restaurants on the first $5,000 spent in purchases. Plus 1 point per dollar on all other purchases.

Flexibility: Redeem your points for travel, cash back and merchandise.

Paperless bonus: Get 5,000 bonus points if you enrol in e-statements and make a purchase within the first 90 days of getting your card.

Click here for more details about the MBNA Rewards Platinum Plus MasterCard*

Best student credit card

BMO SPC CashBack MasterCard*


Warm welcome bonus: 5% cash back on everything for the first 3 months up to $2,000 in purchases.

Straight-up rewards: 1% cash back on all purchases after the welcome bonus ends.

It’s free: No annual fee.

Free SPC membership: A value of $10. Through this program, students will get an additional 10%-20% discount at hundreds of merchants across Canada.

Some retailers that accept the card: American Eagle, Burger King, Subway, the Pickle Barrel, Indigo, David’s Tea, Mac Cosmetics, and more.

Click here for more details about the BMO SPC CashBack MasterCard*

Best low-interest credit card (for carrying a balance)

American Express Essential Credit Card*


Super low-interest rate to save you money: this no-frills, low-interest credit card charges an 8.99% annual percentage rate on purchases, balance transfers, and cash advances—or half the interest rate charged on typical rewards cards. This is also the lowest fixed rate in Canada right now.

Winners: Those who struggle to pay off their balance in full every month.

Main attraction: No annual fee

Introductory bonus: 1.99% introductory annual percentage rate on balance transfers for the first six months.

It’s show time: Priority access to select concerts and events through American Express Invites.

Travel peace of mind: $100,000 in travel accident insurance coverage that will insure you against accidental death when traveling on a plane, train, bus or ship, provided you charge your tickets to the card.

Extended warranty: Automatically doubles the manufacturer’s original warranty if you buy an item on the card.

Click here for more details about the American Express Essential Credit Card*

Best balance transfer credit card (for consolidating debt)

MBNA True Line MasterCard*

No frills benefits that save you big-time: a no-fee credit card that charges 12.99% interest on purchases and balance transfers—about half the usual rate.

Bonus: All eligible applicants will pay 0% interest on any balance you transfer for the first six months.

Nice-to-haves: 24/7 fraud protection and access to high-quality customer service 24 hours a day.

Click here for more details about the True Line MasterCard*

 

Canada’s Best Credit Cards – Rewards Overview

 

Card Net reward (excluding 1st year sign-up bonus)
American Express Cobalt $501
Scotia Momentum Visa Infinite $393
Tangerine Money-Back Credit Card $286
MBNA Rewards Platinum $348
BMO SPC CashBack $240

In-Depth: THE BEST CREDIT CARDS BY CATEGORY


How do credit cards work?

It’s important to understand exactly what credit cards do, so you can use them with maximum advantage without falling into financial trouble. There are lots of benefits. For instance, they offer you a line of credit that can be used when you make a purchase, for balance transfers and/or cash advances. So they are like short-term loans with a balance that must be paid back every month. As you pay down your balance, the credit available to you the following month goes up.

A credit card’s strongest advantage is convenience. Simply pay for your purchase with your credit card and you will be billed for the outstanding balance the following month—no cash in your wallet required. Other benefits include the ability to accrue rewards and points—such as cash back or travel points—based on a percentage of your purchases each month, usually between 1% to 4%, depending on which credit card you own. You can then redeem those points for gift cards, travel, products or other items offered through the credit card company’s online rewards catalogue.

Credit cards can also help you build credit. Always pay on time and your credit score will be high (650+) allowing you in future to borrow for a mortgage or a car loan in future at a reasonable interest rate from your local financial institution.

Of course, credit cards need to be used responsibly and work best when you are a disciplined spender. Have only one or two cards in your wallet and make sure they match your spending habits. And of course, make sure you can pay off the balance in full (or at the very least make the minimum payment) every month so you don’t have to pay hefty interest on your unpaid balance. This can result in costly fees as well as points knocked off your credit score—a real no-no. But with a bit of diligent oversight and self-control, credit cards become helpful and convenient financial tools that can make everyday purchases simple and easy.

How to decide: What is the best credit card for me?

No single card is best for everyone. If you use your card wisely, pay off your balance monthly and find the right rewards program, you’re sure to come out ahead. Still, with thousands of credit card options out there, making a choice can be overwhelming. The key is simple—understand your spending habits. If you’re fill up your tank with gas several times a month, spend a lot on groceries or regularly eat at restaurants, then a card that offers points or rewards when you spend in those categories is a good fit for you.

Also make note of a credit card’s credit limits, interest rates on outstanding balances, fees and penalties. Ask yourself some key questions. Are you the kind of person who will pay the bill in full every month? Then the interest rate doesn’t matter. The best card for you may be one with no annual fee. If you’re carrying a balance, you want the lowest possible interest rate and a low introductory offer. If it’s going to be your main card for most of what you buy, look for a card with a generous credit limit and a solid rewards program.

The card you choose should help you achieve your financial goals, whether that’s trying to build credit, borrow money or earn rewards. The right card will pay off in spades on your bottom line.

Credit card points versus cash back: What to consider before deciding

When it comes to picking a new credit card, you’ll find that the final choice comes down to two types of rewards: points or cash back. And it’s not as simple as just choosing the card that offers you the highest rewards. Other key considerations include where you shop, how much you spend, and the type of rewards you prefer.

Cash-back cards: These are the way to go if you put a lot of value on simplicity. Many of the best give you the highest return based on your weekly spending habits. Depending on the card, cash back is paid out monthly or annually and refunded in the form of a statement credit, direct deposit to your bank account, or by cheque in the mail. What you earn. These cards earn you a fixed percentage based on how much you spend. In general, cash-back cards with an annual fee will earn you a higher base percentage, so you need to factor that in if you’re comparing it to a no-fee card. A variety of cash-back cards offer so-called “multipliers”, which give you a higher percentage of cash back in popular spending categories such as groceries, gas, pharmacies, and recurring bills.

Rewards credit cards: These earn you points instead of cash, and the net points can be used to purchase travel (including flights and hotels), gift cards or other merchandise often offered through an online catalog. They can be quite lucrative if you know how to earn and redeem points to your best advantage. There are two types—the rewards are either linked to a specific travel brand (whether it’s an airline or hotel), or they give you the flexibility to travel on any carrier. If you’re loyal to a specific brand, it makes sense to pick a co-branded card. If you prefer flexibility, then pick a card that gives you the most options. Remember, some also offer sign-up bonuses that can often be worth a few hundred dollars.

It also pays to make sure you can claim your points at a time when it’s convenient to you, so no blackout periods. But most important thing is to simply know what your points are actually worth. For instance, if you earn 1 point for every $1 spent, and it takes 100 points for you to claim $1 in rewards, your points are worth 1%. If you have a co-branded credit card for flights or hotels, you need to determine how many points it takes to get a free flight or hotel room. And finally, you’ll also want to look at the additional benefits offered. Many offer a comprehensive travel insurance package, auto rental insurance, and price protection as standard benefits.

More on our methodology

For the Best Credit Cards 2019 ranking we ran the numbers for each of the cards in the seven categories based on $2,000 in monthly spending ($1,000 monthly for the student cards) as well as interest rates and offers. We also made some assumptions on spending—grocery spend of $500, gas of $200, restaurants of $200 and bill payments of $125, travel of $175, entertainment of $225, pharmacy purchases of $75 and other purchases of $500. (These were adjusted lower for student cards).

The end game was a magic number—that is, the annual net reward in dollar terms to identify the top cards in each category, plus an honorary mention. As highlighted above, our methodology also took into consideration other factors, including the value of a credit card’s welcome bonuses, insurance benefits and flexibility.

‡MoneySense.ca and Ratehub.ca are both owned by parent company Ratehub Inc. We may be partnered with some financial institutions, but this does not influence the “Canada’s Best Credit Card” rankings. You can read more about this in our Editorial Code of Conduct.