The newcomer’s smart spending guide: Turn everyday purchases into rewards

This guide breaks down which everyday spending categories earn the best rewards, how to choose a rewards program that fits your needs, and practical tips to help you build credit faster while keeping more money in your pocket.

Everyday spending categories that deliver the best rewards

If you’re new to Canada, chances are you’re already spending in many of these categories. Review the list below and think about where most of your money will go—those are the areas where rewards can add up fastest.

• Groceries: Weekly food shopping is often one of the biggest household expenses, making it one of the easiest ways to earn significant rewards.
• Transportation: Paying for monthly bus passes, rideshares, gas, and parking is another big-budget item that can really add up. For example, if you use the RBC More Rewards Visa, you’ll earn 5 points per $1 spent on gas, EV charging, dining, and purchases with grocery and pharmacy partners.
• Restaurants and dining: Whether you’re grabbing a quick bite to eat or stopping at a coffee shop for your morning espresso, you can earn rewards.
• Drugstores and pharmacies: As you settle in, you may spend more on household essentials and health items. This is another key rewards category to take advantage of.
• Recurring bills: Monthly expenses like your mobile phone, internet, streaming services, and utilities may seem small on their own, but they add up over time.
• Online shopping and services: Although most credit cards don’t specifically reward online shopping, nearly all cards earn base rewards on online purchases.

Essential vs. lifestyle purchases (and how to optimize both)

If you’re like many newcomers, you’re probably trying to stick to a budget. Part of holding yourself accountable is distinguishing wants from needs. 

Essentials

Essentials fall squarely into the needs category, since these are things you can’t help but buy—we’re talking food, transportation, and household supplies. Utilities are recurring bills that also qualify as needs (though something like streaming services fall into the “wants” category). 

Since you know you’ll have to make these purchases, look for a rewards credit card that offers the highest reward rates for these essentials. You’ll get the most back for your purchases and relying on one primary rewards credit card can help you track your spending and stay on budget.

The RBC Ion+ Visa gives 3x the Avion points for every $1 you spend on groceries, gas, dining, food delivery, rideshare, and streaming services. All other purchases earn you 1 point per $1. So, you can see how quickly you’d rack up points with a credit card that prioritizes everyday spending.

Lifestyle purchases

When you think of wants, eating out, catching movies or concerts, and furnishing your home all count as things that are nice to do, but not essential. Even so, you can still earn rewards by using the right credit card.

Since these might be occasional purchases in the early months of establishing your life in Canada, you might reach for a credit card that earns you a flat rate across all spending categories, like the RBC Cash Back Preferred World Elite Mastercard. You’ll get a steady 1.5% cash back on all your purchases—wants and needs.

How flexible rewards evolve with spending trends

When you first get a credit card after arriving in Canada, it’s natural to focus on a few key spending categories—but your budget and priorities will likely evolve. You may spend more on settlement costs and transportation in the early weeks. Over time, groceries and household expenses often take up a larger share of your budget, followed by bigger lifestyle purchases.

As your spending shifts, so can the way you use your rewards. Early on, cash back applied to your credit card balance may be the most helpful option. Later, you might prefer the flexibility to book travel, buy merchandise, choose gift cards, or mix and match different redemption options.

The strongest flexible rewards programs also help you get more value from your spending through merchant offers and seasonal promotions. Most importantly, they give you control over how you redeem your rewards. For example, RBC’s Avion Rewards program lets you book flights, transfer points to airline partners, donate points to charity, apply them toward financial products, purchase merchandise or gift cards, or redeem them as a statement credit—so your rewards can grow with you.

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6 smart spending strategies for newcomers

Using the right credit card isn’t the only financial move you need to make. Here are some of the most effective strategies for managing your money as a newcomer:

• Take advantage of welcome offers: If you open a credit card (or even bank account), most issuers give you the opportunity to earn a limited-time bonus for reaching spending milestones. Keep these promotions in mind when making purchases, but don’t overspend to chase the rewards.
• Track your early spending habits: Once you’ve been using a credit card for a month or two, take some time to pinpoint your high-earning categories. You might decide that a different credit card would reward you better, or you might find that you’re indeed using the best card for you.
• Charge your everyday purchases and recurring bills to a rewards card: Earn rewards for the things you need to buy. This is a smart money move so long as you pay off the card every month. It also simplifies bill payments.
• Make your payments on time: Whether you’ve got a credit card bill or a recurring utility payment due, prioritize paying your bills on time and in full. This helps you start building a solid credit score, which can get you better interest rates down the road.
• Don’t spend more than you can pay off: If you’re carrying a balance or paying late fees, interest charges quickly erase the value of any rewards you earn. Rewards only make sense if you pay your credit card balance in full and on time every month.
• Use digital tools to budget: When you choose a bank, familiarize yourself with its online tools and mobile app. These make it easy for you to track your spending and stay on top of the rewards you’ve accumulated.

If there’s one piece of advice to remember, it’s this: always make at least the minimum payment on your credit card, on time. Even if you can’t pay off the full balance every month, paying the minimum helps prevent negative information from being reported to Canada’s credit bureaus.

Building toward your personal goals starts with smart money habits—and establishing a strong financial foundation in Canada from the beginning.

Read more about credit cards:

• The best credit cards for newcomers to Canada for 2025
• 8 financial mistakes newcomers to Canada make—and how to avoid them
• Earning, saving, and spending money in Canada: A guide for new immigrants
• Balancing personal and financial goals as you build a new life in Canada

About Jessica Gibson

Jessica Gibson is a personal finance writer with over a decade of experience in online publishing. She enjoys helping readers make informed decisions about credit cards, insurance, and debt management.

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