Canada’s best credit cards 2021

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Finding the right credit card could save you hundreds, if not thousands, of dollars a year. Whether you’re looking for lower fees, more rewards 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, and you are sure to come out ahead. There’s a slew of credit card options out there, and it can be challenging to find the best deal—but this list of best credit cards in Canada is here to help. We’ve highlighted the best in 13 different categories so that you can zero in on the ones that fit your spending habits, and offer features you truly value. Remember, this “best credit cards” ranking is the starting point; the final decision is yours to make. 

 

The best credit cards in Canada 2021

Show more cards

Card	Rewards / Features	Annual fee
TD Aeroplan Visa Infinite (get more details)*	1.5 pts/$1 on groceries, gas & Air Canada 1 pt/$1 on everything else Point values vary	$139
BMO Air Miles Mastercard (get more details)*	1 Mile for every $12 spent Earn 3x the Miles at Air Miles partners 1 Mile = 10.5% in e-gift cards	$120
MBNA True Line Gold (get more details)*	Low 8.99% APR	$39
BMO CashBack Mastercard (get more details)*	3% cash back on groceries‡ 1% on recurring bills‡ 0.5% on everything else	$0
Marriott Bonvoy AMEX (get more details)*	5 pts/$1 at Marriott properties 2 pts/$1 on everything else Point values vary	$120
PC Financial World Elite (get more details)*	45 pts/$1 at Shoppers Drug Mart 30 pts/$1 at PC affiliate stores 10 pts/$1 on everything else 10 pts = 1% in store credit	$0
AMEX Platinum Card (get more details)	3 pts/$1 on dining 2 pts/$1 on travel 1 pt/$1 on everything else 1 pt = 1% / up to 1.75% in travel rewards	$699
Home Trust Secured (get more details)*	Easy to get approved for Helps rebuild credit Deposit required	$0
Rogers World Elite (get more details)	3% cash back on USD purchases 1.5% on everything else	$0

‡ On the first $500 spent per month

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Best rewards cards for everyday spending

American Express Cobalt Card*

With a high earn rate, a generous welcome bonus and easy-to-use points, the American Express Cobalt Card is our top pick as the best travel credit card for everyday spending. 

The points you earn can be redeemed for travel at a rate of 1,000 points for $10 for any flight on any airline with no blackout dates, or they can be used toward the American Express Fixed Points Travel Program, which lets you unlock even better value on round-trip flights. If you prefer to use your rewards for accommodations, you can transfer your points to one of the American Express Hotel partners, including Marriott Bonvoy.

• Annual fee: $120 ($10 monthly)
• Earn rate: 5 points per $1 spent on dining out and groceries; 2 points per $1 spent on travel; 1 point per $1 spent on all other purchases
• Welcome offer: Up to 30,000 bonus points (2,500 points for each monthly billing period in which you spend $500 in net purchases on your Card for your first year)
• Income requirement: $12,000
• Additional benefits: Travel insurance; American Express Invites

Get more details about the American Express Cobalt Card*

Also consider: Scotiabank Gold American Express*

The Scotiabank Gold American Express has been a longtime favourite for Canadians, especially those who travel. The first thing you’ll notice about this card is the Scotia Rewards earn rate is a very healthy 5 points per $1 on groceries, dining and entertainment. Gas gets 3 points per $1, as do spends in two other categories: Public transit and eligible streaming services. All other purchases earn you 1 point per $1 spent. Since 5,000 Scotia Rewards points works out to $50 in travel, the up-to-40,000-point welcome bonus is worth up to $400 in rewards and it gives you a big head-start on saving for your next big trip. This card also doesn’t charge a foreign transaction fee—it’s one of the very few Canadian cards to offer this perk. Consider it a 2.5% bonus (the amount usually charged) on all foreign currency transactions, including online purchases. 

• Annual fee: $120
• Welcome offer: Up to 40,000 Scotia Rewards points in the first year
• Earn rate: 5 points per $1 spent on groceries, dining and entertainment; 3 points per $1 on gas, public transit and eligible streaming services; and 1 point per $1 on all other purchases
• Income requirement: $12,000
• Additional benefits: No foreign transaction fees; travel insurance; 35% off Priority Pass membership

Get more details about the Scotiabank Gold American Express*

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Best cash back cards 

For flat rate: American Express SimplyCash Preferred*

If you want a cash-back credit card but don’t want the fuss of figuring out how the spending categories work, consider the American Express SimplyCash Preferred card. You get a flat rate of 2% cash back on everything you buy, period—with no limit to how much you can earn. Plus, for new members, there’s a juicy 10% cash-back promotional offer for the first four months (up to $400). Additional cards are free (as opposed to the $30 to $50 fees that most other card types charge), which will appeal to couples or families who want to combine their reward earnings. The drawback to be aware of is that rewards can be redeemed only once per year. 

• Annual fee: $99
• Welcome offer: 10% cash back for the first 4 months (up to $400 cash back)
• Earn rate: 2% cash back on everything you buy
  Income requirement: None specified
• Additional benefits: Travel insurance; car rental theft and damage coverage; American Express Invites program for shows, shopping sales and dining perks

Get more details about the American Express SimplyCash Preferred*

For bonus categories: CIBC Dividend Visa Infinite

On top of its standard 1% earn rate, the CIBC Dividend Visa Infinite card earns accelerated cash back rates in a diverse range of five common spending categories. It earns 4% cash back on both groceries and gas (no other cash back card earns more in those two essential categories), and you can earn twice the cash back on dining (including deliveries), daily transit (includes transit passes to rideshares like Uber), and 2% on recurring bills (think smartphone and cable bills). And it’s a standout compared to other cash back cards, as you can redeem whenever you like, as opposed to just once a year. Cash back redemption is done in increments of $25.

• Annual fee: $120 (rebated for first year)
• Welcome bonus: 10% cash back for all purchases for first four statement periods (or first $2,000 in purchases)
• Earn rate: 4% cash back on groceries and groceries; 2% on gas, recurring bills, and daily transit; 1% on everything else
• Income requirement: $60,000 or $100 as a household
• Additional benefits: Mobile device insurance; emergency travel insurance; concierge service; Visa Infinite Dining and Wine Country program

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Best Visa travel points cards 

For flat rate: TD First Class Travel Visa Infinite Card*

Some people want to earn points when they travel, as well as on an ongoing basis. If this sounds like you, then the TD First Class Travel Visa Infinite Card is our top choice. You can rack up TD Rewards points throughout the year and then easily make a redemption through Expedia for TD. With this card, you’ll get 3 points per $1 spent on all your everyday purchases and 9 points per $1 spent when you make online purchases through Expedia for TD. That means you’re earning a 1.5% and 4.5% return respectively in travel points. Expedia For TD is just like the regular Expedia platform, so you’ll have no problem finding ways to redeem your points.

With the annual fee of $120 rebated for the first year and a welcome bonus of up to 60,000 points—which has a travel value of up to $300—this is one of the best travel credit card offers available right now.

• Annual fee: $120 (rebated first year)
• Welcome offer: Earn up to 60,000 TD Rewards points ($300 travel value) when you spend at least $1,500 within the first 90 days. Ends May 30, 2021.
• Earn rate: 9 points per $1 spent on travel online with Expedia for TD; 6 points per $1 spent on travel via phone order with Expedia for TD; 3 points per $1 spent on all other purchases
• Income requirement: $60,000
• Additional benefits: Travel insurance; Priority Pass membership discount; rental car coverage; discounts at Avis and Budget

This welcome offer is not available for residents of Quebec. For Quebec residents, please click here.

Get more details about the TD First Class Travel Visa Infinite Card*

For dining and transit: BMO Eclipse Visa Infinite Card*

While the TD First Class Visa Infinite covered above earns a solid flat reward on your everyday spending, the BMO eclipse Visa Infinite offers a strong boost in particular categories, which are broadly defined, too. You’ll earn 5 BMO Rewards points on food and transit spending. That means in these categories you’re getting a return of 3.5% per $1 when redeemed for travel (140 BMO points = $1 travel rewards). Other categories earn at a rate of 1 point per $1, which is just 0.71% in travel rewards. But there’s a unique perk to make up for that: You’ll receive an annual “lifestyle credit” of $50 to spend as you please. Also, travel insurance and new mobile device coverage are included. 

• Annual fee: $120 (first year waived) 
• Welcome offer: Up to 40,000 points ($285 travel value). 25,000 bonus points after you spend $3,000 in the first 3 months plus 15,000 points on your first anniversary
• Earn rate: 5 BMO Rewards points per $1 on food purchases, including groceries, restaurants and delivery, as well as gas and transit purchases including taxis and rideshares; 1 point per $1 on everything else
  Income requirement: $60,000 personal or $100,000 household 
• Additional benefits: Travel insurance; up to $1,000 in new mobile device coverage; Visa Infinite privileges

Get more details about the BMO Eclipse Visa Infinite Card*

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Best no fee cash back card

Tangerine Money-Back Credit Card*

If you’re looking for a no-fee, cash-back credit card, then the Tangerine Money-Back card needs to be on your radar. With 2% cash back on up to three spending categories of your choice (such as groceries, gas and dining) and 0.5% back on everything else, this card is an excellent choice in the no-fee category. When you sign up, instead the bank set categories for you, you customize your cash-back spending options. You choose two categories where you earn 2% right away, but if you set your cash back to deposit directly into your Tangerine account, then you get to add a third category—meaning you can reap some considerable rewards. 

If you meet the $60,000 annual income requirement, you’ll automatically be considered for the Tangerine World Mastercard, which comes with additional perks such as mobile device and rental car insurance.

• Annual fee: $0
• Welcome offer: New cardholders can transfer balances from higher fee cards, and pay a low rate of 1.95% for six months (subject to a fee of 1% of the value of your balance transfer).
• Earn rate: 2% cash back on up to 3 bonus categories of your choice; 0.5% on all other purchases
• Income requirement: $12,000
• Additional benefits: Purchase assurance and extended warranty

Get more details about the Tangerine Money-Back Credit Card*

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Best no-fee card for travel rewards

MBNA Rewards Platinum Plus Mastercard*

The MBNA Rewards Platinum Plus Mastercard offers a strong sign-up bonus for a no-fee card, and the 10,000 points on offer are easy to earn. All you need to do is spend $500 in gas, grocery and restaurant purchases within 90 days of getting your card to receive the first 5,000 points. Sign up for paperless e-statements to receive the rest. MBNA Points are flexible and easy to redeem for a variety of things including travel, where you get the most bang for your buck at 100 points to claim $1 in travel. For reference, it takes 200 points to claim $1 in cash back.

• Annual fee: $0
• Welcome offer: 5,000 bonus MBNA Rewards Points when you sign up for e-statements, plus 5,000 points after you spend $500 with your first 90 days; 4 points per $1 on bonus categories for your first 90 days
• Earn rate: 2 points for every $1 spent on gas, groceries and restaurants (up to $5,000 annual spend); 1 point per $1 spent on all other purchases
• Additional benefits: Purchase assurance and extended warranty

Get more details about the MBNA Rewards Platinum Plus Mastercard*

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Best Aeroplan card

TD Aeroplan Visa Infinite*

If you tend to fly Air Canada when you can, then the TD Aeroplan Visa Infinite could be the credit card for you. This Visa gives you, and up to eight guests flying on the same itinerary, free checked bags on your Air Canada flights. And when booking, as an Aeroplan credit card holder, you get preferred pricing (using fewer points with Air Canada), too. 

We bet you want to know about the newly revamped Aeroplan plan, too: The earn rate for the card is 1.5 Aeroplan points per $1 spent on gas and groceries. And 1 Aeroplan point per $1 spent on all other purchases. This is a respectable earn rate, since groceries and gas are typically what people spend the most of their money on. You also get great travel insurance, mobile device insurance, purchase security, extended warranty and an annual $100 Nexus rebate.

• Annual fee: $139 (waived the first year)
• Welcome bonus: n/a
• Earn rate: 1.5 Aeroplan points per $1 spent on gas and groceries, 1 Aeroplan point per $1 spent on everything else
• Our favourite features: Free checked bags and Buddy Pass with Air Canada
• Additional benefits: Travel insurance, mobile device insurance, $100 Nexus rebate

Get more details about the TD Aeroplan Visa Infinite*

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Best Air Miles credit card

BMO Air Miles World Elite Mastercard*

Air Miles collectors, rejoice! The Air Miles World Elite Mastercard from Bank of Montreal pairs one of the most generous Air Miles earn rate available—1 Mile per $12 spent—with an extremely valuable suite of travel-related perks, including travel insurance. New cardholders get the first year’s annual fee waived, and the welcome offer of 2,000 Miles will give you a substantial start on your Miles collection.

• Annual fee: $120 (waived for the first year)
• Welcome bonus: new cardholders receive 2,000 Miles
• Earn rate: 1 Mile per $12 spent on your card
• Income requirement: $80,000 (individual) or $150,000 (household)
• Additional benefits: up to 15 days of out of province/out of country emergency medical protection worth up to $2 million; trip cancellation/interruption coverage; baggage and personal effects insurance; and rental car insurance

Get more details about the BMO Air Miles World Elite Mastercard*

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Best low-interest credit card

MBNA True Line Gold Mastercard*

People looking to reduce the amount of interest they pay should consider a low-interest credit card like the MBNA True Line Gold card. You won’t earn anything for your spending on the card, but the interest rate is just 8.99%, which is significantly lower than the average of 19.99% most other credit cards charge. If you’re currently carrying a balance on a credit card with a higher interest rate, then you should also consider taking advantage of the optional balance transfer at the time of application. Balances transferred won’t be charged interest for a full six months, which could save you bundles.

• Annual fee: $39
• Purchase interest rate: 8.99%
• Balance transfer offer: Optional balance transfer at 0% interest for the first 6 months (3% transfer fee, $7.50 minimum fee)

Get more details about the MBNA True Line Gold Mastercard*

NOTE: this offer is not available for residents of Quebec

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Best student credit card

BMO CashBack Mastercard*

The academic year tends to be front-loaded with expenses: Text books, lab supplies and, if you’re living off-residence, housewares and the cost of setting up utilities. This is where a rewards card comes in handy, especially with a great welcome bonus of 5% cash back on purchases on your first three statements. After the bonus period, you’ll still earn 3% cash back on groceries, 1% on recurring bill payments, and 0.5% on everything else. Fortunately for busy students, this straightforward card doesn’t have a complicated points system or tiered earn rates—it just provides simple cash back.

• Annual fee: $0
• Welcome offer: 5% cash back on your first 3 statements (for purchases of up to $2,000)
• Earn rate: 3% cash back on groceries; 1% on recurring bill payments; 0.5% on everything else
• Additional benefits: Extended insurance on purchases made with the card; up to 25% off rentals at eligible Alamo and National Car rental agencies

Get more details about the BMO CashBack Mastercard*

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Best hotel card

Marriott Bonvoy American Express

For those who travel frequently and want to make the most of their hotel-stay purchases, the Marriott Bonvoy American Express simply can’t be beat. You can earn Bonvoy points on your credit card purchases that can be redeemed for a variety of perks and bonuses within the Marriott Bonvoy environment. That includes: Hotel stays offered at more than 7,000 properties worldwide, flights and rental cars, or you can exchange them for gift cards, merchandise or event tickets. The earn rate is 5 points per $1 at Marriott properties and 2 points per $1 everywhere else—and the 60,000 point welcome bonus (enough for three nights in a category-2 hotel) gets you started on your way. With an annual free night and travel insurance, this is by far the best hotel card on the market. 

• Annual fee: $120
• Welcome offer: Up to 60,000 bonus points when you charge at least $3,000 in the first three months, and get a $120 credit when you charge $10,000 in net purchases in the first year
• Earn rate: 5 points per $1 at Marriott properties; and 2 points per $1 everywhere else
• Additional perks: travel insurance; car rental coverage; annual free night’s accommodation

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Best store or retail card

PC Financial World Elite Mastercard*

Due to its association with Loblaws stores and Shoppers Drug Mart, the PC Optimum program offers members access to a wide variety of ways to earn PC Optimum Points, including gas, drug store and grocery purchases. With an earn rate of 30 points per $1 in Loblaws-owned stores (including No Frills and Real Canadian Superstores), 45 per $1 at Shoppers Drug Mart, and 10 everywhere else, this card is one of the best no-fee cards for gas and groceries on the market. It’s simple to redeem points. You simply show the card at checkout anywhere PC products are sold and get $10 back for every 10,000 points. There’s even an included package of travel and car rental insurance—and it carries no annual fee.   

• Annual fee: $0
• Earn rate: 30 points per $1 in Loblaws stores (including No Frills and Real Canadian Superstores) and PC Travel; 45 points per $1 spent at Shoppers Drug Mart; 30 points per litre at Esso; and 10 points everywhere else
• Income requirement: $80,000 (personal) or $150,000 (household), as well as a $15,000 minimum annual spending requirement
• Additional perks: Travel insurance; car rental coverage

Get more details about the PC Financial World Elite Mastercard*

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Best card for perks

American Express Platinum

If you’re looking for a premium card with all the perks, you’d be hard-pressed to find anything better than the American Express Platinum. The included travel insurance alone is worth a second look, but add to that complimentary airport lounge access with unlimited passes to Priority Pass and Centurion lounges, an annual $200 travel credit, hotel upgrades and Platinum Concierge services, and you’ve got the key to an upgraded experience. The card offers plenty of Membership Rewards points earning opportunities on dining, travel and everyday purchases, and comes with a 50,000-point welcome bonus. Another advantage of joining the Amex system is that you’ll gain access to the lucrative Fixed Points Travel program, and you’ll be able to transfer your points to dozens of other loyalty programs.

• Annual fee: $699
• Welcome offer: 50,000 points when you spend $5,000 in the first 3 months
• Earn rate: 3 points per $1 on dining; 2 points per $1 spent on travel; 1 point per $1 on everything else
• Additional Benefits: Unlimited free lounge access at over 1,200 airport lounges; $200 annual travel credit; travel emergency medical insurance; travel accident insurance; car rental coverage; hotel upgrades; Platinum; Concierge services; American Express Invites

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Best secured credit card for building credit

Home Trust Secured Visa*

You might be new to Canada, have a problematic credit history, or are just starting out on your own financially. There are many reasons why you might need to build or rebuild your credit—but whatever the case, you’ll want to take steps towards achieving a healthy credit score. That’s where the no-fee Home Trust Secured Visa can come in. Unlike with conventional credit cards, it’s easy to be approved for a secured card—you just need to be a resident of Canada (except Quebec) and have a deposit. The Home Trust Secured Visa tops our list for its low minimum deposit (you can start with as little as $500) and $0 annual fee. With this card, building your credit score is simple and affordable. 

• Annual fee: $0
• Interest rate: 19.99%
• Additional benefits: None

Get more details about the Home Trust Secured Visa*

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Honourable mention

Rogers World Elite Mastercard

Frequent U.S. travellers and cross-border shoppers need a card that won’t break the bank when it comes to the foreign transaction fees that most banks charge. It is usually 2.5% for purchases made in another currency. The Rogers World Elite gets this nod because it offers 3% cash back on U.S.-currency purchases, which works out to a 0.5% return when you factor in foreign transaction fees. Pair that with no annual fee, and 1.5% back on all other purchases, and you have a competitive card.

However, world travellers will want to keep in mind that only the regular 1.5% earn rate will apply on foreign currency purchases outside the U.S., so you won’t come out ahead after being hit with the 2.5% foreign transaction fee.

This card does include travel medical insurance, which covers you for trips up to 10 days. However, it also comes with a $15,000-a-year minimum spend, and a steep annual income requirement. So you’ll want to consider another option if you don’t make $80,000 a year as an individual, or $150,000 as a household.

• Annual fee: $0
• Welcome bonus: $25 when you make your first purchase within your first 3 months
• Earn rate: 3% on purchases in U.S. currency (0.5% after foreign transaction fees); and 1.5% cash back on all other purchases
• Income requirement: $80,000 individual; $150,000 household
• Additional benefits: Travel emergency medical insurance for 10 days; rental car insurance; trip interruption and cancellation coverage

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Summary

Canada’s best credit cards

	Credit Card	Best	Annual Fee
1	American Express Cobalt	Travel rewards card for everyday spending	$120
2	Scotiabank Gold American Express	Travel rewards card for everyday spending	$120
3	American Express SimplyCash Preferred	Cash back card (flat rate)	$99
4	CIBC Dividend Visa Infinite	Cash back card (bonus category)	$120
5	TD First Class Travel Visa Infinite Card	Visa travel card (flat rate)	$120
6	BMO Eclipse Visa Infinite Card	Visa travel card (dining and transit)	$120
7	Tangerine Money-Back Credit Card	No fee cash back card	$0
8	MBNA Rewards Platinum Plus Mastercard	No fee travel card	$0
9	TD Aeroplan Visa Infinite	Aeroplan card	$139
10	BMO Air Miles World Elite	Air Miles card	$120
11	MBNA True Line Gold	Low interest card	$39
12	BMO CashBack Mastercard	Student card	$0
13	Marriott Bonvoy American Express	Hotel card	$120
14	PC Financial World Elite Mastercard	Store/retail card	$0
15	American Express Platinum	Premium rewards card	$699
16	Home Trust Secured Visa	Secured credit card for building credit	$0

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How do credit cards work?

It’s important to understand exactly what credit cards do, so you can use them to maximum advantage without falling into financial trouble. There are lots of benefits that come along with having a credit card. For example, they offer credit that can be used when you make a purchase, for balance transfers and/or cash advances. Essentially, your credit is like a short-term loan with a balance that comes due every month. As you pay down your balance, the credit available to you the following month starts to go back up to the maximum credit limit on your card.

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 choose. You can then redeem those points for gift cards, travel or other items offered through the credit card company’s online rewards catalogue.

Credit cards can also help you build credit. If you always pay on time, that will help you achieve a high credit score (650+points), allowing you to borrow for a mortgage or a car loan in the future at a reasonable interest rate from your local financial institution.

Of course, credit cards need to be used responsibly, and they 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 getting 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 easy.

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Types of credit cards

Rewards credit cards

When it comes to rewards credit cards, the name says it all. These are cards that give you something back when you spend with them, whether it’s points, miles or cash. The more you spend, the more rewards you get. For those who pay off their balance in full every month, these cards can really add value. There are four main types of rewards cards:

Cash-back credit cards

These cards offer a rebate credited to your balance, usually calculated as a percentage of the dollar value of your purchases. Though most cash-back cards have accelerated earn rates in certain categories (groceries and gas, for example), they all also have a minimum base rate for spends outside those categories. Your cash back rewards can help you save on anything you can buy with your card.

Travel credit cards

These cards offer points or miles to be redeemed towards travel-related purchases such as flights, hotels, cruises or vacation packages. Rewards might not be as straightforward as cash back, but travel points cards can help you save big on upcoming trips, with many offering perks including sign-up bonuses, comprehensive travel insurance, and even airport lounge access. 

Store credit cards

These cards gift you with points for everyday purchases that can be redeemed for discounts off items from your favourite retailer. The idea is to reward brand loyalty with valuable benefits. The PC Financial Mastercard and the Canadian Tire Mastercard credit cards are great examples. 

Hotel credit cards

Similar to travel cards, hotel credit cards reward consumers with points redeemable for hotel stays and perks. These cards are often linked or co-branded with a specific hotel brand or loyalty program, like Marriott Bonvoy or Best Western Rewards 

Low-interest credit cards

With standard interest rates sitting at anywhere between 19.99% and 22.99%, most rewards credit cards aren’t the right fit for people who carry a balance. That’s where low-interest cards come in. These cards, which typically charge between 8.99% and 12.99% interest on purchases, allow cardholders access to credit without high interest charges that quickly add up. They don’t usually have much in the way of extras or perks, but the lower rates help to ensure that you’ll come out ahead in the long run if you generally need more time to pay off your card balance.

Balance transfer credit cards

Once you accumulate a debt load on an existing credit card, the interest will compound—rapidly. Your best bet is to transfer the debt to a balance transfer credit card, which lets you move debt from a high-interest card to one with a lower rate. These cards often offer promotional interest rates for a specific period—0% interest for the first 10 months, for example—which can buy you time to pay down your balance with little or no interest. Sometimes, even the regular interest rate on a balance transfer card is lower than usual.

Student credit cards

Student, or “starter,” cards are credit cards aimed at people with no credit history looking to establish a credit score. These entry-level cards tend to have few qualification criteria, no annual fees and provide little in the way of perks or extras, but some do offer some decent rewards on your everyday spending.

Secured credit cards

People who lack a good credit score or a local credit history often have trouble getting approval for standard credit cards. This can be a real problem for those wanting to build up their credit towards a future purchase or loan—but secured cards can offer a solution. This kind of card is “secured” with a deposit by the applicant and virtually anyone will be approved. The responsible use of a secured card will help build, or rebuild, your credit score. 

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

To decide which credit is the best for you, you need to look at your priorities. If you normally carry a balance or you want to reduce your debt, then a low-interest or balance transfer card should be the only types you consider.

People who always pay off their full balance every month need to decide whether a travel or cash-back card makes more sense for them. Travel cards can offer lucrative rewards, but if you don’t like to travel, there’s no point in you getting a travel credit card. If this sounds like you, then a cash-back card may be the way to go.

Now that you’ve got your category of card selected, take a look at the earn rate, additional, benefits and which type of points you earn for each card. If you happen to spend a lot on gas and groceries, then look for a card that has a high earn rate for those categories.

The annual fee should also be a consideration in your decision making, but if you think you’re getting good value out of your additional benefits and you’re making more back than you paid with the fee, then it shouldn’t be a big deal.

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

In the end, your decision will come down to whether a cash back or travel rewards credit card suits your needs and spending habits best. As mentioned, travel rewards can be lucrative, but a cash-back card is simple since you don’t need to worry about any potential travel restrictions. Here are some tips for considering each type of card.

The first thing you want to look at is the earn rate. Take stock of your spending habits and pick a card that will earn you the most rewards. For example, if you spend a lot on gas, then pick a card that earns you more cash back at gas stations. High-earn rates are great, but keep in mind that many of the top cards have a high-income requirement. Cash back programs are simple to understand, but some credit cards will only give you what you’ve earned after you reach a minimum amount or once per calendar year. Find out how you’ll get paid and make sure you’re okay with it before you apply. If you’re considering a card with an annual fee, make sure the extra cash back you earn is worth more than the fee. If it’s not, stick to a no-fee card.

Selecting a rewards credit card

Generally speaking, cards that earn you points are usually best used for travel redemptions. These cards will likely give you other ways to cash out your points, but the majority of the time, you get the most value for your points when redeeming for travel. Similar to cash-back cards, you want to pick a card that gives you the most points on the categories you spend the most money. You also want to figure out what type of travel you prefer; you could get an airline-branded credit card or a hotel-branded one. There are also credit cards that allow you to redeem for any type of travel. Regardless of what you go with, you need to know how the reward programs work so you can maximize your points.

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More on Canada’s best credit cards

• • • Best rewards credit cards
    • Best travel credit cards
    • Best cash-back credit Cards
    • Best no-fee credit cards
    • Best low-interest credit cards
    • Best balance transfer credit cards
    • Best student credit cards

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Our methodology

For the best credit cards 2021 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.

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