Finding a no fee travel credit card is kind of like finding life on Mars - it's hard and definitely takes some time...
The reason for that is annual fees are necessary to supply the increased rewards, insurance coverage, and perks that travel cards typically have.
While life on Mars is still being debated, fortunately Canadian no fee travel cards already have some life - but they may soon be on life support. There is an underserved need for this type of card though, especially if points and miles are brand new to you. Learning the ropes of travel rewards without the risk of high fees is valuable.
Once you've figured it all out though, then you'll want to graduate to a top tier travel credit card that racks up the rewards faster and gives way better perks.
Best Travel Credit Cards With No Annual Fee
No fee travel cards are extremely rare, I could only find 16 to compare. The top 10 are listed below from best to worst.
The table scrolls horizontally by using the slider at the bottom.
|Apply||MBNA Rewards MasterCard|
|Apply||Capital One Aspire Travel Platinum MasterCard|
|Apply||American Express Blue Sky Credit Card|
|Apply||National Bank CAA Rewards MasterCard|
|Apply||BMO IGA AIR MILES MasterCard|
|Apply||National Bank Allure MasterCard|
|Apply||BMO Sobeys AIR MILES MasterCard|
|Apply||American Express AIR MILES Credit Card|
|Apply||BMO AIR MILES MasterCard|
|Apply||BMO SPC AIR MILES MasterCard|
|Overall Score||Rewards On $25,000 Spend1,2||Rewards On $100K Spend1,3||Sign Up Bonus Value4||Insurance Score||Perks Score|
* Limited time promotion ending soon.
1. The rewards dollar values shown are calculated by splitting spending sensibly across spending categories like groceries, gas, drugstore, travel, bills, and everyday spending. Multiple price checks of typical travel rewards were done to calculate the true value of each type of reward points. If converting points to miles increases the reward value, that was also assumed to be done. All spending bonuses, tiers, limits, and caps are taken into account. Sign up bonuses are NOT included in these numbers, so that will be an extra perk for you. Finally, the annual fee is deducted from the rewards values shown giving you the true value of the rewards left in your pocket for the year.
2. $25,000 in annual spending works out to $2,083 in monthly spending which is achievable for a typical Canadian family funneling most of their spending through their credit card.
3. $100,000 in annual spending works out to $8,333 in monthly spending which is too high for most families. I have included these numbers to better evaluate cards and give an advantage to cards who don't have spending caps or limits. It also allows cards that have a good tier system to shine at higher spending levels.
4. The sign up bonus is a lump sum of points or miles you get when first opening a new credit card. It is often given when you make your first purchase, spend a reasonable amount of money on the card within the first X months, keep the card open for X months, or some combination of those. The criteria to qualify for the sign up bonus are usually very reasonable.
What's Important To You?
Going after the top card is a smart choice. But, if you're looking for one particular feature or benefit, it may not be the best fit for you. That's why I'm going to break down the top cards by feature so you make a more informed decision.
Get Traveling Faster
If you want to get away as fast as possible, then you want to maximize the dollar value of your rewards.
There's only one card that trounces all the others in terms of straight reward value, and that's the American Express Blue Sky Credit Card. You'll net $313 annually worth of flexible travel rewards if you spend $2,083 monthly, which can be redeemed towards any type of travel you charge to the card. That's a straight return of 1.25% back in rewards on your spending.
Big Sign Up Bonuses
The biggest bonuses usually come with cards that have an annual fee, but some no-fee cards still have a bonus. The MBNA Best Western MasterCard (rank 11) gives a decent sign up bonus of 20,000 points, which is worth about $111 in Best Western gift cards. If you can find a Category 1 Best Western hotel to stay in for 8,000 points, then you could increase that to as much as $200.
If you want a fully flexible travel bonus, then the American Express Blue Sky Credit Card comes with $100 in free travel of any type. Simply charge any travel purchase to the card, and pay for it with your points instantly online or by giving them a call.
Earn More At Some Stores
No fee travel cards rarely reward you for making specific purchases or shopping at certain stores. That said, the BMO IGA AIR MILES MasterCard gives you 1.25x the Miles at Shell gas stations and double Miles at IGA stores (mostly found in Atlantic Canada and Quebec).
The BMO Sobeys AIR MILES MasterCard offers double points at Sobeys grocery stores. Sobeys stores are spread more widely across the country, so it would be a better choice for many than IGA.
Without question, the top pick for flexibility is the MBNA Rewards MasterCard. Not only can you charge whatever travel you want and get it reimbursed directly to the card, you can also get your rewards credited as cash either by statement credit, direct deposit, or cheque. Further you can cash out as often as you want as long as you meet the $50 rewards balance minimum threshold.
Lower Minimum Income Needed
High income requirements are more a "feature" of high annual fee credit cards than those without a fee. Every card in the top 10 has pretty miniscule income requirements. So, as long as your credit history is decent, you should qualify.
Solid Insurance Coverage And Perks
The MBNA Rewards MasterCard has the best combination of both perks and insurance coverage. You get extended warranty, purchase protection, travel accident, trip interruption, rental car theft and damage, rental car accident, and rental car personal effects insurance coverage. For perks you get a sign up bonus worth $50, 100% flexible points redemption options, and cash back at the same rate as travel rewards.
The Capital One Aspire Travel Platinum MasterCard is another strong contender, especially for insurance. You get double the usual extended warranty (2 years), longer purchase protection (120 days), price protection (rare), $300 worth of lost, stolen, or delayed baggage, rental car theft and damage, and $250,000 of travel accident.
A third option is the National Bank CAA Rewards MasterCard. Not surprisingly, it has top of the line car rental insurance coverage along with 5 other types of insurance at no cost to you.
Ease Into Reward Travel
With these no fee cards you aren't going to be flying around the world in record time ... but the good news is that most of them are flexible in what kind of travel you can purchase with your points. No fee cards are a great option for building up a rewards balance over a few years and then getting a nice discount on your next vacation.
They can also ease you into becoming a newbie travel hacker. If you are just getting your feet wet with travel rewards credit cards, have a lower income, or have lower monthly spending - one of these cards is just the ticket you need.
Finally, always remember that letting credit cards with rewards entice you into much higher spending and debt is NEVER worth it. Please only apply for these cards if you plan to pay them off in full every month.