How to pick a credit card with amazing benefits

Picking the ideal credit card perks

The ideal perk or reward credit card is subjective to your everyday spending categories and what is most accessible to you. While redeeming for a free flight might be a tremendous value to frequent travellers, if you don’t fly a lot, you might end up with a large pool of airline miles sitting in a balance where alternate redemptions may be of low value. In this case, redeeming for free groceries on a different credit card designed for grocery or cash-back benefits makes more sense.

Keep in mind, popular cards often have a lot of flexibility when it comes to redemptions. For instance, a premium credit card like the American Express Platinum Card will require you to pay a higher annual fee but this card offers flexible annual credits that can be used on a long list of travel and dining partners, as well as unlimited lounge access at partner locations and even status matching with popular brands like Marriott Bonvoy.

For perk-seekers who like eating out other premium cards offer higher earn rates. For instance, the American Express Cobalt Card offers 5x points on dining and groceries and a flexible redemption currency that can be transferred to everything from travel, hotels or even statement credit to pay off everyday bills – a popular choice for many new credit card holders in Canada. Other great cards that offer higher earning rewards on food purchases include the BMO Cashback Mastercard and the Scotiabank Momentum Visa Infinite, which offer 3% to 4% cashback on grocery purchases.

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Difference between credit card perks and rewards

When considering which perks or rewards are right for you, it’s important to understand the difference first:

A perk is a benefit that’s included with your credit card, something such as:

• Access to a lounge
• Status matching
• Car rental upgrades
• Free nights at a hotel
• Concierge service for booking dining and entertainment
• Roadside assistance
• Purchase and travel insurance
• Annual travel credits
• Flight buddy passes

A reward is something that you redeem a currency or certificate for through spending on a credit card:

• Free groceries
• Free gas
• Hotel stays
• Reward flights
• Cash back
• Gift cards or products
  
  

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Types of credit cards to look out for (when maximizing perks and rewards)

There are several categories credit cards in Canada can be grouped into. These include:

• Best premium credit cards
• Best cash-back credit cards
• Best no-free credit cards
• Best travel credit cards
• Best hotel credit cards
• Best grocery store credit cards
• Best no-foreign exchange fee credit cards

Credit cards with amazing benefits in Canada

A high-annual-fee credit card will yield the highest return, with one caveat: You must remember to use the rewards before their expiration dates.

For those who are part of the exclusive Aeroplan Elite Flyers Club, there are some high-value credit cards to consider. The TD Aeroplan Visa Infinite Privilege, American Express Aeroplan Reserve and CIBC Aeroplan Visa Infinite Privilege cards offer an Annual Worldwide Companion Pass, rollover Status Qualifying Miles (SQM), extended eUpgrade credit validity, Priority Rewards redemption credits and flight credit coupons. These perks are among the most valuable for a credit card in Canada, but remember, they're only beneficial if you take advantage of them and redeem before the rewards expire.

If you fly less, you might want to consider a credit card offered through a grocery store like the PC World Elite Mastercard that gives you a high earn rate if you shop at Loblaws banner grocery stores, Esso or Mobil gas stations, and Shoppers Drug Mart pharmacies with a lower threshold for redeeming for cashback.

If you're someone who values simplicity and doesn't have the time to constantly track and optimize your perks and rewards, the Rogers Red World Elite Mastercard could be the perfect fit. With a $0 annual fee, a flat 1.5% cashback on Canadian-currency purchases, and 3% back on USD purchases that essentially refunds foreign exchange fees, it's a straightforward way to earn rewards without the hassle of managing them.

Popular bank credit card reward programs

Bank credit cards are quite competitive and offer many standard perks and rewards. However, slight differences like earn rates, accelerator and program participation might sway Canadians from one credit card to another. A few factors will persuade you towards the right program:

• Which program offers you value (Aeroplan vs. Air Miles)
• Which grocery you shop at (Loblaws vs. Metro vs. Sobeys)
• Which gas station you fill up at (Esso vs. Shell)
• Whether your bank offers an annual fee waiver for banking with them
• Do you have a preferred airline? (Air Canada vs. WestJet)

Bottom line

Ultimately, you should analyze your spending categories and retailers, cross reference it with redemption partners and rewards value, and see which card will offer you the most value every year.

For many Canadians, the lower-cost or no-fee credit cards offer just as much if not more value as a premium card, so doing your research will set you up for rewards success.

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