Finding The Right Card To Reap The Rewards

Canadians have a myriad of options when it comes to choosing the right credit card for their spending needs. Rewards credit cards are increasingly popular as consumers look for ways to earn travel points or cash back on their everyday purchases. Readers often ask me which credit card is best. The answer is that it depends on a number of factors, including how much you spend and where, as well as what you want to get out of the card in terms of a reward.

No doubt that travel rewards credit cards are among the most popular, and for good reason. The allure of a free flight or hotel room holds a lot of appeal to many Canadians looking to escape a cold winter. But most travel rewards programs tend to come with restrictions, fees, and strange policies that make it difficult to redeem your points.

Travel rewards certainly have more perceived value than straight cash back rewards. Flights and hotels are expensive and so anything that can help subsidize your vacation is a welcome relief. Unfortunately, it can be difficult to determine the exact value of your travel rewards points. Since the price of a flight or hotel can vary drastically from day-to-day and season-to-season, it’s hard to pin-point the actual cash value of your rewards.

These reasons are why I take more of a pragmatic approach to choosing a rewards credit card. For me, cash back is king. Here’s why cash back beats travel rewards:

Cash back credit cards appeal to consumers who recognize the rational value of being rewarded for the purchases they make every day. Cash back is as straightforward as it gets. Most cash back credit cards offer you the choice of a statement credit or a cheque in the mail, giving you full control to spend (or save) your rewards.

With a no annual fee card like the SimplyCash Card from American Express, you can earn $150 in cash back rewards annually when you spend $1,000 per month. That’s a return of 1.25 percent on your spending. Plus, you’ll get 5 percent cash back on all eligible purchases at gas stations, grocery stores and restaurants in Canada (up to $250 cash back) for the first 6 months. That adds up to big savings for purchases you make every day.

A recent American Express survey found that, if given cash back on everyday purchases, 41 percent of Canadians would save it for a rainy day, while 17 percent say they would treat themselves to something they’ve been saving for.

What would you do with your cash back rewards? Let me know in the comments below, or send us a tweet using the hashtag #SimplyCash, and there may be something in it for you.

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  1. Bryan on May 14, 2015 at 8:57 pm

    Cash back is king! I love travel, but even with travel rewards, I find a trip will never be “free”. Even with a free flight, you still need to save up for the other expenses of the trip regardless.
    I love just getting a statement credit! Boring, but it can be a big help. This past holiday season, I was able to use my almost $700 worth of cash back rewards to ease the pain of the extra spending. That was over a years worth of rewards, but well worth it!
    I will need a new card in October since I have an expiring Capital One Aspire Cash World MC. So in September, feel free to write an update about the best cards available 😉 Always enjoy your posts!

    • Andrew on May 15, 2015 at 9:41 am

      Hi Brian. It’s Andrew from Capital One. I saw your post regarding the Aspire Cash World MasterCard and wanted to take this opportunity to let you know that you’ll receive a replacement card once it expires. Have a great long weekend!

  2. Don on May 14, 2015 at 11:03 pm


    after reading this site, I decided to switch out of my BMO Mastercard with AirMiles rewards to the Scotiabank Visa Momentum. I realized that the BMO card just wasn’t worth the fees, and the cash rewards are much appreciated.

  3. tp1943 on May 15, 2015 at 4:40 am

    Switched to an AE Simply Cash Card from AE Air Miles. Acceptance at grocery stores other than Metro is not possible. Any advice from other readers?

    • Stephen @ on May 15, 2015 at 12:09 pm

      Are there any stores that sell gift cards at their gift card malls to the grocery stores you want to go to? If so, buy the gift cards with your Amex at one of those gift card malls and then use it to pay for your groceries? It’s a bit of a hassle and there’s always the risk of losing the gift card, but it works.

      The only other suggestions I have are to find another no-fee card to use at the stores that don’t take Amex like the MBNA Smart Cash. You’ll do better on gas and groceries with that card anyway.

  4. Northmoon on May 15, 2015 at 6:15 am

    I have an American Express card with airmiles that I got to help a friend who travels a lot. she got a large number of points for recommending the card to me. I was fine with helping her out, but finding out how many points I’ve got is a big pain in the a**, let alone actually tryig to use them.

    I’d far rather have the cash, I wonder if they would switch me to the cash back card?

  5. Barry on May 15, 2015 at 7:35 am

    I also have the older Capital One Aspire Cash World Mastercard which is expiring this October. It has been,by far,the best card for everything – from cash back at 1.5% to travel and purchase insurance….and it had no fee. I am hoping that a new card with the same benefits will appear in mail, but I really doubt it. So I’ll be looking for a new card with similar benefits. I would get the Scotia Momentum Visa card, but I do most of my grocery shopping at no-frills (it is right across the street from my condo!) and they only accept MC, so a visa card is a no-go.

    • Andrew on May 15, 2015 at 9:50 am

      Hey Barry. It’s Andrew from Capital One. I’ve got good news for you! Aspire Cash World MasterCard cardholders’ recieve a replacement card once their current card expires. Have a great long weekend!

      • Barry on May 15, 2015 at 10:44 am

        That’s great news! Thanks Andrew!

    • Joe on May 23, 2015 at 9:18 am

      Strange, I shop at No Frills and have never had an issue using my Scotia Visa Momentum card.

  6. gcai on May 15, 2015 at 8:06 am

    Personally I use two cash back cards – MBNA Smartcash World (mastercard) and Chase Amazon Visa – both offer 1% cash back on everything and higher amounts on groceries/cash.
    MBNA is my main card.
    The Visa is used primarily for Amazon purchases (2% back) and for foreign travel/currency purchase (eg. USA/Europe) as it does not charge the 2.5% foreign transaction fee common to most cards and they use a wholesale FX rate for charges (i.e. the FX rate is not padded).

    My question is does anyone know of a DEBIT card that doesn’t charge foreign ATM fees (i.e. cash draws from ‘other’ ATMs are free)? I have a debit card from TD Banhk in the US that does this but would like a CDN one if available.

    ps. use the cash back to pay off the credit card balance.

    • Hyacinthe on May 15, 2015 at 9:44 am

      Scotiabank and Tangerine debit cards can be used abroad to WITHDRAW without foreign currency fees, in selected foreign banks part of the Global ATM Alliance. You can find the list here.

      • gcai on May 16, 2015 at 4:54 pm

        thanks Hyacinthe -u that’s a good start but the Scotia/Tangerine list is a bit short on coverage i.e. no Asia and spotty in Europe – and restricted to specific bank partners (they are usually VERY hard to find when you need them)
        – the TD Bank card that I have is wide open any ATM anywhere and they refund the access/surcharge fees – the only real hassle I have is there is a potential double F/X hit (i.e. I have to buy USD first (hint I use the Norbit gambit) and I have to move the money around (lag time)

        • Grant on May 17, 2015 at 6:57 am

          Another trick you can to avoid FX fees on cash withdrawals in foreign countries is to get a cash advance from an ATM on your Amazon Visa card, then go online and pay the money back to your Amazon Visa account. You’ll probably be charged one day’s interest on the cash advance, but that’s better than the FX charges.

          • gcai on May 17, 2015 at 5:09 pm

            that’s a good idea Grant but it’s not the F/X so much that concerns me as much as the ATM access fee and ‘foreign’ (to my bank system) ATM surcharges (eg. if I use my TD (Canada) debit card I believe the flat fee is $5 plus whatever the ATM fee that I’m accessing – ouch!)
            – also I’ve found Chase Visa to very slow on crediting payments e.g. I paid my current bill on Thursday (debited from my account) and as of a few minutes ago (Sundat PM) no credit in my Visa account; also making payments when on the road can be tricky – personally I use a VPN (tunnelbear) but prefer not doing financial stuff on unknown wifi access

        • Des on May 27, 2015 at 9:31 am

          I have used my scotiabank card many times in many of these countries to get cash and save on fees. At first I missed some of the ATMs because they mainly featured the logo of the partner bank, and were not at the bank itself.
          You do see the banks themselves sometimes, but you need to use the ATMs, not teller service.
          I can only comment on scotiabank for this.

          • gcai on May 27, 2015 at 11:54 am

            still the “any ATM, anytime” is better – too bad CDN debit card issuers don’t step up – btw I looked up the areas covered by Scotia and imo they are spotty – I would rather walk up to the first ATM I see (and sometimes the only one in town) and get on with my trip rather than hunt down one that doesn’t charge me – yes I know I could pay the fee 🙂 but why?

    • igra on May 15, 2015 at 11:44 am

      Ha! I use the same 2 cards (primarily)! Great minds think alike! 😎 I also have Capital One Aspire Cash World MC but rarely use it these days.

  7. Devin on May 15, 2015 at 8:13 am

    Bryan and Barry I have good news. My Capital One Aspire Cash World MC expired this month and they have already sent me a replacement card that is exactly the same. Just don’t cancel the card or you will never get it back again.

    • Barry on May 15, 2015 at 10:45 am

      Good to know Devin, thanks! I have no plans to cancel this card!

  8. Sean Cooper, Financial Journalist on May 15, 2015 at 7:30 pm

    I’ll take a cash back credit card over a travel rewards credit card any day of the week! With cash back it’s so much simpler – you don’t have to worry about silly things like black out periods.

  9. Grant on May 17, 2015 at 7:53 pm

    gcai, is there anyway to avoid those ATM charges? I’m not sure there is. I don’t think there’s anything to worry about accessing your bank account on the road. The bank uses a highly secure connection, and you have to answer a personalized question each time you access your account from a different system. I do it all the time, including a brokerage account, and there has never been a problem.

    • igra on May 17, 2015 at 8:19 pm

      >there has never been a problem.

      You’ve been lucky so far, Grant. Doing on-line banking while connected to a public Wi-Fi is definitely riskier than doing it from home. Read this article, for example, for a detailed explanation:

      • gcai on May 17, 2015 at 10:05 pm

        thanks igra for the link – using a VPN does mitigate the risk somewhat but not doing financial stuff is still the best way to avoid surprises 🙂
        @grant yes there is a way to avoid the ATM fees but the solution involves setting up a US based account- I have one at TD Bank (TD’s US sub) and yes it allows you to use any ATM anywhere and they refund any charges/fees – this works for me as I’m in the US frequently and have need for a US based account but so far I have not been able to find a Canadian debit card that is as generous – btw there are a few US based debit cards ( Charles Schwab is another that I know of ) that have this free ATM access perk – guess our CDN banks just love those fees – good reason to hold them as investments I guess – I do 🙂

        • gcai on May 17, 2015 at 10:13 pm

          forgot to add the “any ATM, anywhere” is worldwide – I just returned from a longer trip to SE Asia and it worked flawlessly

  10. Grant on May 18, 2015 at 7:02 am

    Ingram thanks for the link. The message seems to be you’re probably. OK using a VPN connection, but if not, don’t do it in a “high value” area such as a financial district.
    gcai, good idea about a U.S. domiciled bank account, so long as you need a U.S. bank account anyway. You probably have the monthly fee for the U.S. account plus currency conversion fees, even with Norbets.

  11. Mike on May 27, 2015 at 9:42 am

    Be careful with the Capital One card. I had one for a number of years and all of a sudden it was cancelled with no notice. I received a letter in the mail two weeks later indicating that it looked like I was charging items for my business on my card and therefore they immediately cancelled my card. Good thing I was not on vacation at the time.

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