What are Cash Back Credit Cards?

Cash Back Credit Cards are simply what they sound like, they give you cash back for every purchase you make. Usually, these cash back cards will give you a specific percentage cash back, but different cards will have different percentages or even offer you higher rates for specific categories, like travel, gas or groceries. Depending on your spending habits, one card might be more beneficial to you than someone else. There are so many cash back credit cards in Canada these days, so it’s a no brainer for you to sign up for one today because you definitely want to start taking advantage of all the benefits and rewards cash back cards can offer you.

What Should I Consider When Picking a Cash Back Card?

Annual Fees: If you don’t plan on using your card a lot, annual fees can end up costing you more than the cash back you can earn. Take this into account and figure out how much you will actually spend on your cash back card.

Welcome Bonuses: A lot of cards will offer you a higher cash back rate for the initial few months after signing up. This is a great perk to keep in mind, especially if you plan on making a large purchase sometime soon.

How You Spend: Depending on what you spend your money on, you can maximize the benefits of a cash back card. Different cards give different rates in various categories, so it’s important for you to think about your spending habits and pick a card that will benefit you the most. Not all cards are best suited for everyone.

Your Credit Score: In order for banks to trust you and offer you a new line of credit, they will take a look at your credit score to see if you are a reliable borrower. Some other cards will also take your personal income into consideration. It’s important to check your credit score regularly and always make sure you pay your bills on time.

Our Top Cash Back Credit Card Picks:

1. Scotiabank Momentum Visa Infinite

This card has been highly ranked on various websites and is definitely one of the best credit cards you can find in Canada. The best reason to get this card is for the special introductory bonus that gives you 10% back on all purchases for the first three months after signing up. After that, this card offers 4% back on gas and groceries, 2% back on drugstores and recurring bill payments, and 1% back on all other purchases. You can also waive the first annual fee, saving you $99 your first year. On top of the high cash back rate, this card also offers travel insurance, travel medical insurance, and car rental insurance, making it a great card if you travel frequently.

2. TD Cashback Visa Infinite

The TD Cashback Visa Infinite offers some of the highest cash back rates you can find inCanada. The card gives 6% cash back (up to $3,500) on certain categories for the initial 3 months after signing up. This means you can earn up to $210 in your first three months of having the card, which covers the annual fee of $120. After the introductory offer ends, you will earn 3% back on groceries, gas, and bills, and 1% back on all other purchases. Additionally, it offers travel medical insurance, and makes you a member of TD’s Auto Club, should you ever need roadside assistance. This card comes with great perks, but you will need a minimum income of $60,000 a year in order to get approved.

3. American Express SimplyCash Preferred Card

If you’re looking for a straightforward card for everyday purchases, this is the card for you. The SimplyCash Preferred Card is one of the best flat rate cards in Canada, as it offers 5% back on all purchases for the initial 6 months after signing up, another great bonus incentive to get the card. After the first 6 months, you will get 2% back on all purchases. There is an annual fee of $99 to take into account, however American Express cards do not require a minimum income when you apply.

4.Rogers World Elite Mastercard

This is one of the best Canadian credit cards if you’re a regular world traveler. The Rogers World Elite Mastercard has a foreign transaction fee of 2.5% (like most other credit cards), but it lets you earn cash back on top of the purchases you make abroad, so you end up earning cash back instead of paying foreign transaction fees. With the card, you receive 4% back on purchases made with foreign currency, and 1.75% back on any purchase made within Canada. On top of that, this card offers medical travel insurance, flight cancellations, rental car insurance, and there’s no annual fee.

5. Tangerine Money Back Card

The Tangerine Money Back Card is great because it doesn’t require you to have an excellent credit score. It also doesn’t have an annual fee, but you do need a minimum income of $15,000 in order to get approved. This card is considered a bonus category card because it offers you a higher percentage rate of 2% back in 3 categories that you can choose from, such as gas, groceries, drugstores, restaurants, or travel. You can tailor your card so you can maximize your cash back based on what you like to spend your money on. Outside of the three categories you choose, you will get 0.5% back on your purchases and there are no caps on your spending. Not all cash back cards are created equal, so the best thing for you to do is to spend some time researching different cards that are available in Canada. You want to make sure you find a card that will give you the most cash back based on your spending habits, annual income, and credit score.

Resources:

1. https://www.slice.ca/money/photos/best-cash-back-credit-cards-canada/#!RBC-cash-back
2. https://www.greedyrates.ca/blog/best-cash-back-credit-card-canada/
3. https://www.moneysense.ca/spend/credit-cards/best-cash-back-credit-cards-in-canada/
4. https://www.ratehub.ca/blog/best-cash-back-credit-cards-in-canada/