Can there really be one single BEST credit card?
Honestly, nailing that down is pretty hard because everyone's preferences are different. Credit cards offer so many types of rewards, features, insurance, and perks that comparing them against each in an apples to apples way seems nearly impossible...
But, I was foolish enough to try.
5 years ago I made my first attempt at ranking Canadian credit cards. That first attempt was good but not great - I held back from naming THE best card. I continued to track more cards and improve the system year over year. Thousands of hours have been invested...
Today, 124 cards of all types are tracked and ranked using 40+ unique ranking factors to determine which are really best. Finally, there can be one true champion that is best for most Canadians.
Of course, the decision of whether the winner meets your needs is all yours ... but you won't find a better starting point than this. (Not sure what to pick? Take this short quiz and find out.)
Best Credit Card Overall
American Express Gold Rewards
The total rewards package of the American Express Gold Rewards Card simply cannot be beat.
First, you get an extremely flexible rewards program in Membership Rewards that allows you to use your points to book any type of travel with any travel provider. Or, convert those points 1:1 to real airline miles with Air Canada's Aeroplan or British Airways' Avios allowing you to fly nearly free on 42 airlines using airline alliances. Your points become roughly 3x more valuable by converting them to miles, so I highly recommend doing so.
Next, you discover that you earn double points on an unheard of 4 bonus spending categories: gas, groceries, drugstore, and travel. Other cards either don't offer bonuses, limit them to 1.5x, or have points that are far less valuable with no airline mile conversion options. No other card offers a bonus on ALL travel purchases either.
Then, you notice the massive 25,000 point sign up bonus worth $750 in free flights. The first year is always free - not just during promotions. The annual fee is a completely reasonable $150. You only need a minimum $20,000 income to qualify when most competitors require $60,000+. You pinch yourself when you realize you're looking at $1,722 worth of flight value in the first year if you spend a reasonable $2,000 per month on stuff you would buy anyway.
Finally, you get a well-rounded travel insurance package at no extra cost that offers 10 types of free insurance including 15 days of emergency medical coverage and a nice suite of perks. Those include: a free secondary card, more bonus miles if you book with American Express Travel, free upgrades and credits at partner hotels, elevated Hertz Gold status, Front of the Line, special event invites, Apple Pay support, and more.
Best Cash Back
MBNA Rewards World Elite
The MBNA Rewards World Elite MasterCard (MRWE) is better than the Scotiabank Momentum Visa Infinite - there I said it!
4% cash back on gas and groceries is enticing, but don't forget the 1% on most other purchases. If you do the math, the straight 2% cash back that MBNA offers usually ends up slightly better than what you'd get with Scotia.
There's more than just max cash to consider though...
With MBNA you get to redeem your points any time you want, any way you want - direct deposit, cheque, statement credit, travel, merchandise, even charity donations. Scotia? Once a year as a statement credit and if you decide to cancel the card before then, you lose ALL of your remaining cash.
The MRWE also has a lower $89 annual fee plus an additional 10,000 points (worth $100 in cash back or travel) as a sign up bonus. If you spend $25,000 per year on the card ($2,083/mth), you're looking at $411 cash in your pocket after paying the annual fee. That means you'd get $511 in the first year because of the $100 bonus in year one.
Doubling as a travel credit card, the MRWE has unusually strong insurance coverage and perks. It offers 8 types of insurance, concierge, and rare price protection coverage that allows you to price match any purchase charged to the card with any lower price you can find without the usual restrictions. Oh, and let's not forget that you can use it at Costco locations because it's a MasterCard and that TD Bank owns MBNA if you're looking for name recognition.
Best No Fee Cash Back
Tangerine Money-Back Credit Card
Not everyone can stomach an annual fee - especially students, low income earners, light spenders, and credit card newbies. If that's you, then a no fee cash back credit card is the right choice.
The new Tangerine Money-Back Credit Card roared onto the scene in mid-2016 offering an unprecedented 2 or 3 bonus spending categories YOU get to choose. In those categories you get 2% bonus cash back - double the usual 1% on all other purchases. This one feature allows you to earn the MOST cash back of any no-fee cash back credit card.
If you spend $25,000 per year ($2,083/mth) on the card, a typical person with normal spending patterns will earn $338 in cash back yearly. Compare that to the $125 you'd get with the worst no-fee card out there and you can see what a huge difference choosing the #1 card makes.
There is no limit on the amount of money you can earn at either the 1% or 2% rate. You can even change your bonus spending categories every 90 days if your spending habits shift to maximize your rewards. Better, you get 4% cash back on your chosen bonus categories for the first 3 months you have the card, again with no limit. It's actually the only card in Canada that doesn't impose a sign up bonus limit.
American Express Gold Rewards
The Gold Rewards card gets another nod as the best travel credit card for the same reasons it has been named Best Overall. It simply gives you the most rewards and travel benefits for a card with a reasonable $150 annual fee.
The only thing holding it back from being the one piece of plastic people should use exclusively is some stores still don't accept American Express. That list is pretty small though. I can use my Amex at most places I shop, but there are a few big ones like Loblaws/Superstore and Costco that won't accept it.
Here's a tip: simply keeping a no-fee cash back MasterCard like the Tangerine Money-Back as a backup fixes the acceptance issue. You can even get up to 7 bonus spending categories by combining the 4 from Amex with the 3 more YOU get to choose from Tangerine.
The massive sign up bonus of 25,000 points that can be converted to Aeroplan in a few clicks online and the first year annual fee being waived are reason enough to give this card a try. Test it out for a year, see if your favourite shops accept it, and if you don't think it gives you enough value you don't need to keep it for the second year.
Best No Fee Travel
MBNA Rewards MasterCard
No fee travel credit cards are few and far between - I was only able to find 15 to compare.
Why? To take off on your next adventure as fast and as far as possible, annual fees are needed to support the increased rewards, insurance coverage, and perks that these cards are known for.
The MBNA Rewards MasterCard is both a travel and cash back credit card in one giving you complete flexibility over how you redeem your points. This flexibility coupled with a very strong insurance package for a no fee card is what propels it to the top of the no fee travel group.
You get 1 point per dollar spent, which works out to 1% of your spending back as rewards that you can use for travel or cash. Points can also be redeemed for merchandise and charitable donations. It comes with a 5,000 point sign up bonus (limited time) worth $50 in cash back or travel and 7 types of insurance coverage, including 1 Million in travel accident coverage and $2,000 in trip interruption.
Best AIR MILES
BMO AIR MILES World Elite MasterCard
If you're an AIR MILES junkie, then this is the card you want. Period.
It's so far ahead of all the other AIR MILES cards it isn't even funny. In fact it scored 52% higher than its closest competitor. In other categories, the gap between second and first place is typically 10% or less.
Why is the BMO AIR MILES World Elite MasterCard so much better than its competitors?
First, it gives you the best AIR MILE earning rate of any card - 1 Mile per $10 spent on ALL purchases. Then, you get an exclusive 25% discount on the cost of reward flights making your Miles more valuable. Next, it has the 2nd best insurance package of ANY credit card in Canada with 14 types of insurance including 15 days travel medical, $2500 trip cancellation, and $750 personal effects that covers you for lost or stolen items for the entire duration of your trip (very rare).
Finally, it has great perks like concierge, a
1000 2,000 mile sign up bonus (limited time), lounge access, and free extra cards.
American Express Gold Rewards
The American Express Gold Rewards Card isn't an Aeroplan branded credit card, but it allows you to convert Membership Rewards points 1:1 to Aeroplan, so it might as well be. As the top overall card, it was a shoe in to win as the top Aeroplan card as well. The double rewards bonus for gas, grocery, drugstore, and travel purchases in a card with a $150 annual fee is just too hard to compete with.
The 25,000 point sign up bonus, first year free, and respectable insurance and perks package it has seals the deal.
Best Insurance Coverage
BMO CashBack World Elite MasterCard
A cash back credit card winning a "best insurance" award is honestly a complete shocker. Most cash back cards have paltry insurance coverage because they are geared towards people who want simple rewards and don't travel often.
The BMO CashBack World Elite completely bucks this trend and provides better overall coverage than even its BMO World Elite MasterCard brethren that is a full-fledged travel rewards card. The two have nearly identical insurance except the cash back card doubles the usual extended warranty and purchase protection coverage. The travel card partially compensates for this by having longer emergency medical coverage.
The BMO CashBack World Elite gives you 13 different types of insurance and is best overall in 4 of those categories. Here's the complete list:
- Extended warranty on purchases - up to 2 years extra.
- Loss/damage protection on new purchases - 180 days.
- Personal effects - up to $750 for the entire trip duration (very rare).
- Travel accident - up to $500,000.
- Emergency medical - trips up to 8 days.
- Trip cancellation - up to $2,500.
- Trip interruption - up to $2,000.
- Flight delay - up to $500.
- Baggage delay - up to $200.
- Lost/stolen baggage - up to $750.
- Rental car accident - up to $200,000.
- Rental car personal effects - up to $1,000.
- Rental car theft/damage.
Other benefits include 1.75% cash back on ALL your purchases and free roadside assistance which is an extremely rare perk, perfect for road warriors. That alone can recoup most of the $120 annual fee and then all the insurance and cash back you get is just gravy.
The Platinum Card
The Platinum Card is in a class of its own when it comes to amazing perks.
I got this card myself a couple of years ago for the big sign up bonus and crazy perks and was very hesitant to give it up. I kept it for a 2nd year because of its high 15,000 point bonus for referring others (worth $450 in flights when transferred to Aeroplan). Earlier this year I went back to the Gold Rewards Card because I am no longer actively referring people and couldn't justify the $699 annual fee.
What kind of perks are we talking about?
It starts with a $200 annual travel credit that you can use on any travel booked through American Express. This is based on a calendar year, so you can actually use the credit twice before your 2nd year annual fee kicks in, effectively reducing the first year fee from $699 to $299. The huge 50,000 point sign up bonus (worth $1,500 in flights) can't be ignored either.
Then there's these:
- Redeem points for ANY type of travel or convert 1:1 to Aeroplan or Avios airline miles.
- Unlimited airport lounge access for you and a guest at Priority Pass lounges worldwide (very rare).
- Additional access to American Express lounges and select lounges at most Canadian airports.
- Free valet service and discounted parking at Toronto Pearson.
- Priority security lane access at Toronto Pearson.
- Discounted companion tickets, complimentary upgrades, and special airfares with select airlines.
- Complimentary upgrades, free breakfast, late checkout, or spa credits at more than 700 hotels worldwide.
- Complimentary Starwood Preferred Guest Gold status.
- Complimentary Club Carlson Gold Elite status.
- Complimentary Hilton HHonors Gold status.
- Fast track to Fairmont President's Club Platinum status after only 5 nights stayed - 30 normally required.
- Free Preferred Golf membership for 1 year giving you free rounds at select golf resorts with a 2 night stay.
- Standby MD travel medical concierge including house calls in foreign countries.
- Advanced ticket sales and reserved seating at select events with Amex Invites & Front Of The Line.
- Dedicated customer service line for Platinum cardholders.
- Unique experiences exclusively for Platinum cardholders.
- Discounts and upgrades on Hertz and Avis car rentals.
- Platinum concierge AND travel service.
Making the Right Choice
There is no one size fits all when it comes to credit cards, but there is a one size fits most.
The American Express Gold Rewards gives you a great balance of rewards, flexibility, insurance coverage, fees, bonuses, and perks that none of its rivals can match. If you like to travel or need to fly longer distances at all, then it's a smart choice for you.
Finally, remember that letting credit cards with rewards entice you into much higher spending and debt is NEVER worth it. Only get one if you will pay it off in full each and every month.