Your travel card perks are costing you money — here's when to switch to cash back instead

According to a national YouGov survey commissioned by Flight Centre Canada, 62% of Canadians say they are less likely to visit the U.S. in 2026 compared to last year (1), and cross-border trips fell 28% in 2025 (2). If you're less likely to travel south of the border or take an international flight, those lounge passes and priority boarding perks start to look a lot less valuable.

So is now the time to consider switching to a cash back credit card, instead? Here’s how to make that decision.

The case for switching to a cash back credit card

Unlike travel rewards credit cards, cash back credit cards give you an immediate return.

Whenever you make a purchase, you'll get a certain percentage returned to you in cash. This is highly appealing, especially since there are no blackout dates, rewards charts, or peak pricing to consider (a factor that applies to many but not all travel reward credit card programs).

The funds you earn from a cash back card can be used to offset the costs of your day-to-day expenses, such as groceries, gas, utilities and more, which matters more than ever right now. It means your ‘rewards’ aren’t tied to one type of expense: Travel. Instead, you can spend your rewards to offset everyday costs, helping you stick to a budget or manage higher living costs.

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Plus, with cash back, you can still travel. In 2025, domestic tourism in Canada hit a record-breaking $59 billion in summer revenue, with $44.4 billion of that driven by Canadian travellers who chose to stay close to home (3). Cash back earned on everyday spending directly supports this kind of flexible, close-to-home travel plans — and gives Canadians more flexibility and how and where to spend their loyalty program rewards.

For those of us feeling the pinch of a weaker loonie and higher grocery bills, the simplicity of cash back — money in your pocket, no strings attached — is hard to argue. Nearly 6 in 10 Canadians (58%) say cost will ultimately determine where they travel this year (4). Cash back rewards match that mindset perfectly.

The case for sticking to your travel credit card

To be fair, many travel credit card providers have recognized that travel patterns are shifting, so they're offering other perks. For example, many premium cardholders regularly receive targeted offers such as dining credits, discounts on purchases and increased earn rates on everyday spending. If you take advantage of these benefits, they can easily offset the annual fee paid to use a premium credit card.

Plus, not all Canadians have cancelled travel plans. Despite the pullback from U.S. travel, Canadians are still travelling abroad.

One in 4 Canadians (25%) has slotted Europe as their top travel destination for 2026, while domestic travel remains the top choice overall at 38% (this is followed by 24% who chose Mexico and the Caribbean (5), but this was before the violence that erupted in Mexico at the end of February).

Seven in 10 Canadians say they are confident they will take a vacation this year (6). If you plan to travel to Europe, Asia or within Canada, your Aeroplan or other travel points could be worth 1.60 cents per point or more when redeemed for flights, which is a genuinely strong return (7).

By continuing to use your travel rewards credit card, you keep building up your bank of points. That could give you a significant balance when you're ready to book a transatlantic flight or a bucket-list trip — and as long as you continue holding your card, points on major programs like Aeroplan won't expire.

Double-dip your rewards

If you're going to keep your travel rewards card, you should make the most of it. Many people don't realize that you don't need to choose between cash back and travel rewards — you can earn both without changing any of your spending habits.

PC Optimum is one of Canada's most popular loyalty programs, with millions of members regularly earning and redeeming points for discounts on food, health, beauty and household items (8). The program has expanded significantly since its 2018 launch. In 2025, PC Optimum partnered with DoorDash to let members earn five points for every dollar spent on eligible delivery orders — from favourite restaurants to Loblaw-affiliated stores like Real Canadian Superstore, No Frills, Loblaws and Shoppers Drug Mart (9). That's a meaningful expansion of everyday earning opportunities.

To earn PC Optimum points, download the PC Optimum app and scan it at participating retailers including Loblaws, No Frills, Real Canadian Superstore, Shoppers Drug Mart and Esso stations. Then check your app regularly to take advantage of personalized offers — those targeted deals are where the real earning power is. Points can be redeemed for cash off groceries, beauty products, merchandise and more.

To double-dip your rewards, pay with your travel rewards credit card at the checkout while also scanning your PC Optimum card or app. This way, you're earning travel points and loyalty rewards at the same time. You can also get a PC Financial Mastercard, which layers PC Optimum points on top of the in-store and targeted offers you're already accessing through the app.

Some options for cash back cards

Since travel rewards credit cards can still offer value, there's no reason to cancel your travel cards. Instead, you may want to consider applying for a no-fee cash back credit card so you can earn cash rewards in the meantime.

One popular option is the Tangerine Money-Back Credit Card. It gives you 2% cash back on two categories of your choice from a list of 13 — including groceries, restaurants, gas, drug stores, entertainment and recurring bills. If you choose to deposit your rewards directly into a Tangerine Savings Account, you unlock a third 2% cash back category. All other purchases earn you 0.5% cash back, paid monthly, with no annual fee (10). The ability to change your bonus categories every 90 days makes this card uniquely flexible — you can shift your 2% earn rate to match where you're spending most right now.