Credit Cards – Visa, Tangerine, AMEX

How many credit cards should you own? What are some criteria you must look at before signing up for your credit card? What are some of the best credit cards in Canada? What are some of the no fee, low foreign transaction fee credit cards in Canada? These questions has been a subject to many discussions and is likely to be so in the coming years. In this article, I will offer  my insights on the above mentioned questions.

Realistically speaking, you should own at least two credits – one for personal use, and the other for making online purchases – eBay, Amazon, etc. Now, you do not necessarily have to own a separate credit card just for the online transactions, as you can also buy the gift cards. The sole reason, behind having another credit card is safety. Having a low-limit credit card for online transactions, or shady gas stations is a convenience.

So what are some factors you must consider before buying a certain credit card? Here are few important ones:

  1. Low Interest – There is nothing better than having a credit card with low interest. It is basically a no-nonsense approach for an individual who wants credit card but does not really know which should they have. Conversely, high interest credit cards usually mean you pay more on the dollar spent.
  2. Rewards Programs – Financial institutions have started introducing many rewards programs like – AIR MILES, SPC, PETRO POINTS, etc. Choose which one is the right fit for you but remember a credit card with a reward program generally means higher interest rates if you are unable to pay the balance off in 21 days (or the minimum time period).
  3. Frequency – How often you use it, is a question that a lot of consumers must ask themselves. Sometimes, not everyone needs to have a credit card. Although, having one is usually handy. 
  4. Annual Fee – I own three credit cards, and none of them have annual fees attached to them. However, if there is an annual fee that gets compensated back to me in the form of the total expenses I have incurred, I am willing to look into it further only if the benefits outweigh the marginal chance of the annual fee coming from my pocket.
  5. Travel Card – Another key criteria is the ability to use the credit card for travel purposes. As such, you need to make sure of the credit spread charged by the financial institution for foreign transactions. The lower the better, as it is much more closer to the prevailing spot rate(s) on the market.
  6. Insurance – Often overlooked, this aspect of a credit card plays a key role in safekeeping your assets. In an event your product is damaged or stolen, you are doomed. However, having and knowing the insurance policy of your credit card is critical as it would ensure you don’t pay for something important twice (simply because you are aware that you’re covered by your credit card).
  7. Extended Warranty – We live in a digital age and as such we are bound to get our fair share of bad apples for some of the electronic purchases. Credit cards usually cover an additional year of manufacturer’s warranty once your original warranty of one year expires.
  8. Balance Transfer – Are you signing up for another card with a plan to transfer the balance? You might want to look into the transfer charges (if any), and the rules around it. Even if you are not planning to use the balance transfer but have multiple cards, it might be a good idea to look into this, should your future financial circumstances change.
  9. Revisit why you signed up for a certain credit card. Financial institutions change their policies every now and then (for example, Tangerine), and you must make sure your interests are still aligned with the same reasons as the first time when you signed up for it.

Credit Cards I own:

  • Amazon Canada Visa
  • Tangerine MasterCard
  • American Express (Simply Cash)

Update: Tangerine MasterCard

  • So, Tangerine changed their rewards plan – from paying customers 1% to 0.5% cashback on every purchase that is not qualified under their two/three designated categories.
  • Also, the 1.5% foreign conversion fee has changed to 2.5%.
  • This just goes on to show how as consumers we need to be on the guard for any policy changes. While I am certainly not pleased with this Tangerine change, I decided to sign up for American Express (Simply Cash).

Additional Resources:

This link does an awesome job in summarizing the best cash back credit cards in Canada. I relied on this link before I signed up for Tangerine MasterCard.

Disclaimer: 

The above website link is a third-party link, and as such I do not guarantee any accuracy on the data provided above, nor am I affiliated or get compensated from the above. The article on credit card is my opinion on the subject, and I am not getting compensated for in any form for recommending the above.

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