Estimated reading time: 9 minutes
Unveiling the reality of Canadian credit cards: they can be a necessity and a potential trap. Learn how to navigate the credit card landscape.
Credit Cards Can Benefit Canadians
Is there any mystery why some people were not meant to own a credit card?
When I talk to most people about debt, they tell me it’s the fault of the credit card they carry tucked in their wallets.
They fail to recognize that the card isn’t doing the shopping; it’s them.
It’s the reality that a credit card is sometimes necessary to book a hotel, rent a car, or use PayPal and other online frequencies.
If you don’t have one, the consumer hears, you are not privy to use our services, or we don’t know if we can trust you.
It’s like a gold ticket for these retailers, you mess up, they have your number.
If your credit score isn’t up to snuff, you might lag your mates, who can capitalize on all the perks a credit can offer.
Credit Score And Applying For Canadian Credit Cards
What is a Credit Score?
According to Industry Canada, a credit score is a judgment about your financial health at a specific time.
You can check your credit score for free once per year.
You are rated on a scale of 300-900, where one means you pay your bills within 30 days of the due date.
If you have a rating of 300, you have some explaining.
A low credit score may mean you struggle to pay your bills or have gone into a consumer debt repayment proposal.
Know your credit score as it’s essential to your financial well-being, so it’s important to understand how it can affect your finances.
Earn Rewards Faster With Canadian Credit Cards
Credit Cards don’t have to have a bad wrap if appropriately used and paid in full at the end of the month.
The best part may be the incentives involved if appropriately used, although credit card companies want you to pay the minimum balance.
Then what happens? You know all those perks.
Well, you are now paying interest charges for them.
Not all Canadian credit cards are created equally, so it’s up to you to decide what card works best for you.
Remember that you read the fine print and know your interest rate and any “other” potential charges.
If it doesn’t make sense to you, ask. The only foolish question is the one you didn’t ask.
Many people toss the fine print in the bin, and then when something goes wrong, they blame the credit card company.
People who use these credit cards to their advantage, like us, take the perks and run with them.
Whether you get Air Miles, free groceries, money-back, scene points, or gas, it’s money back in your pocket, provided you pay your bill on time.
The hard part is figuring out what Canadian credit cards are right for you and leaving the ones you will never use.
Don’t be fooled or enticed with freebies; spin the Credit Wheel offers discounts and deals if you won’t use the credit card.
The last thing you want is more credit on your credit report that you aren’t using to get a discount.
Cancelling Canadian Credit Cards You Don’t Use
However, leaving a long-standing credit card on your report is better than canceling it.
Keeping long-standing credit cards open even if you don’t use them helps build your credit score.
If you cancel the credit card, you also remove the history which makes up a part of your credit score.
If you think prepaid credit cards are the better option, think again.
I received a pre-paid Visa Christmas Gift, which is nonsense.
They charged me a $5.00 activation fee on a $20.00 card.
Always read the fine print, or you might spend more than you bargained for.
We have three Canadian credit cards that we prefer to use, and I’ll tell you why below.
Canadian Tire Triangle MasterCard
- My Canadian Tire Money has come in handy on more than one occasion and has saved money in our home maintenance and vehicle maintenance budget.
- We use Triangle credit cards for everything we purchase for the home, vehicle, and clothing.
- I also like to take advantage of Canadian Tire’s email coupons and offer 10x-30x points or other deals.
- Cash Advance Fee $4
- NSF Fee (Non-Sufficient Funds) $25
- A foreign currency transaction fee of 2.5%
- You also get deals at Marks Work Warehouse, Sport Chek, Park City, Pro Hockey Life, Atmosphere, Sports Rousseau, Hockey Experts, L’Entrepot du Jpckey, and participating Sports Experts stores.
- Earn 4% back in Canadian Tire Money on almost everything at Canadian Tire and other stores.
- Plus, get 5 cents per litre back in CT Money at Gas + and Petro Canada locations.
- Earn 1.5% when you use your card to buy groceries and 0.5% on everything else.
- No annual Fee
PC World Elite Financial MasterCard
- Free Groceries, sure, bring it on. We’ve lost count of how much we have received back in PC points and used towards FREE groceries. However, we currently have over 7 million PC Optimum Points in part, which we earn with the MasterCard.
- We purchase all our groceries with this card and get points through paying our bills online and bringing our shopping bags.
- This has been a lovely incentive credit card for us, and we plan to use it as long as they offer PC Optimum Points.
CIBC Costco Mastercard
I reviewed the CIBC Costco MasterCard because we use it primarily to get gas and stock up on everything at the warehouse.
Typically, we purchase all the gas for our truck, lawn mower, and snowblower from the Costco gas station.
Whenever we shop at Costco Canada, we use the CIBC credit card to earn points for our yearly membership.
Since we are a small family of three, the return is often enough to cover our yearly membership.
Why Canadians Love Credit Cards
Below are CBB readers who shared with me what Canadian Credit Cards they prefer to use and what perks they offer.
BMO Cashback MasterCard
Christine Weadick– I had to get a new credit card after my hubby passed last summer. I went with a cash-back M/C at our bank, BMO. Quick and easy for me.
That cashback will be used for Christmas shopping!!
President’s Choice MasterCard
Beverly Edmondson Woods– I like my PC Mastercard. It has no annual fee and awards me PC Optimum points on every purchase, no matter where I use it.
I currently have over 300,000 points; I save all my points throughout the year, redeem them in December, and start over with collecting points in January.
Zayba– I love my credit card!!! I have a Shoppers Optimum MasterCard and usually only spend on my card, which is always paid off every month.
It helps me keep track of my spending and gets me extra Optimum points!
I redeem every few months…of course, I wait for the spend your points events!
Scotiabank Scene Visa Card
Allyson Turner- My Scotiabank Scene Visa Card has gotten me free movie tickets, free gas, and an excellent credit rating, allowing me to buy a house without needing my parents to co-sign it.
It allows me not to miss paying my phone bill, making instant payments through PayPal, and making purchases online where PayPal is not accepted.
I can buy gasoline without entering the store and waiting in line. I don’t live off my credit card, but it has had some excellent perks.
Lois– I like my Scene Visa Card, which saves me money and is far better than an Air Miles credit card.
Related: Learn more about the Scene = Program from Scotiabank
Canadian Tire Triangle MasterCard
Shelley Ann McInnes Chenier– My husband loves our Canadian Tire Triangle MasterCard because he gets Canadian Tire money on the card. We do pay it off within days of using it!
Shoppers Optimum MasterCard
Zayba– I love my credit card!!! I have a Shoppers Optimum MasterCard and usually only spend on my card, which is always paid off every month.
It helps me keep track of my spending and gets me extra Optimum points! I redeem every few months…of course, I wait for the spend your points events!
KOHO Prepaid MasterCard
Amanda Roth– My KOHO Mastercard. It is prepaid, and I earn cash back as well as interest on any money I have loaded on the card.
Discussion: What Incentives do you get with your Credit Card?
Please leave your comments below.
Thanks for reading,
Mr. CBB
Awesome 🙂 Yet another great Article!!!!!!!!
Zayba, that’s because we have a wonderful community who loves to share their opinions. cheers and thanks for your support and comments. Mr.CBB
I dont have credit cards, and I seem to think it helps me budget better. It also makes life less stressful with no debt!!
Whatever makes you comfortable is what’s iimportant. There is no perk that will ever add up to stress free living without debt! cheers Amie! Mr.CBB
credit cards can indeed be good, its knowing how to use them to your benefit though.
That’s the name of the game!! Spend and pay it off in full.. enjoy the rewards if any. Cheers and thanks for your post. Mr.CBB
I might have to get a PC credit card! I never knew it was that easy to get free groceries!
It’s such an awesome Credit Card.. we can get up to $1000 a year depending on how much we put on the credit card and pay off each month… awesome. No I don’t work for them … lol just like free. Thanks for your comment Dani. Mr.CBB
great read once again:) I liked the part about always reading the fine print best!!!!
It’s true, we are both guilty of not reading the fine print in the past and nearly got the surprise of a lifetime.. always read what you are signing up for! Thanks for your comment. Mr.CBB
I love to use my cards for rewards , I use them then pay them right off when I get home ! great way to earn the rewards and never pay interest !
PC Card gets me free shopping and we usually save it up for xmas pressies at the end of the year.
That’s the cool part you don’t need to just spend it on groceries. You can use it on almost everything in the store. RCSS, and Zehrs some of them have full stores with household items, clothes etc.. it’s great. Thanks for your post Nicola! Mr.CBB 😉
My husband loves credit cards and they are one thing that contributed to our financial problem the first time around. Now that all that debt will be paid off when the house closes, we are playing it smarter. This time around we will have one credit card with a $500 limit for some of the reasons you mention in the article, hotel booking etc. He has agreed that this will be the only reason it will be used. Other than the mortgage and a car payment this is all the debt that we will have. I am looking forward to living out from underneath extreme financial stress.
Once you understand how you spend your money and why you do what you do you will become more mindful of your spending. At least that is what you will hope for. Good Luck and I look forward to learning more from you! Cheers Mr.CBB
never thought of a PC Financial card for points! Credit Cards are necessary for booking travel, hotels or an emergency. I only use mine if I know I have the money to pay it off right away or for a planned trip
Good for you, paying off your credit card debt in full each month means you are smart with your money. Once you make excuses for not paying you are on your way to some trouble.. back up and take a breath and get back on track. Godd Luck. Mr.CBB
Looking forward to trying to get into a good place with our credit cards. It will take us some time but we are starting to work on it now.
That’s good news! Get rid of that debt and never make an excuse to use the credit card again unless you have the money to pay it at the end of the month or you are putting yourself back in danger. Save money in an emergency fund now even if it’s $5 a month… Cheers Mr.CBB
Another great article Mr CBB! I really can’t decide now if I want to try and get another PC Mastercard! lol
You are the master of your destiny, make your decisions for the right reasons.. and research everything, and ask the right questions. Cheers Mr.CBB
i love my capital one card and paypal, The reason is low interest on capital one and would never be without either one. There are some great deals on the net, so i only use them for that reason.
Good for you.. it’s important to find cards that fit your lifestyle and can use and pay off each month. In your case you point out a low interest rate which is also important. Thanks for posting Sherri! Mr.CBB
Great article you have here. Thank for the information shared about credit cards. Well, it can be good or bad depending on how you use it.
Yes that is exactly the point eh mate, it can be a positive perk or a destructive evil. Cheers and thanks for your comment. Mr.CBB
I’ve had a credit card for close to 20 years. I have never paid a cent in interest. I’ve always kept in my mind that if I don’t have the money in the bank to pay the monthly balance off, then I cannot afford what I am purchasing and have to either not buy what I want or need, save more up before I can make a purchase or buy a less expensive product. As someone that shops at Walmart frequently I made sure to get the Walmart mastercard when it became available. I use it to pay for just about everything and reap the rewards. I pay it off every month. It is also nice for budgeting because if a miss a receipt, I can just look at my statement. Thanks Mr. CBB for the post!
That is how everyone who has a credit card should think. It’s not free money, it’s an evil love/hate relationship that can turn sour very very fast if we are not mindful. Great tips. Thanks for sharing Joanna!! Mr.CBB
I love getting free groceries at Costco by using my American Express Card.
Mr. CBB – I love this line! They fail to recognize that the card isn’t doing the shopping, it’s them. I just picture someone’s card jumping out of their wallet, and going for a little walk and shopping.. 🙂 I have a CIBC Adventura card which gives you points you can use for gift cards or travel!
Ha, sounds to me like someone has a creative memory! What have you actually used your points on? I used a load today at PC.. I”m just about to post the amazing deals we found. Let’s just say there is NO room in the freezer. Mr.CBB
The demand for credit card use has increased for the past years and this article gives us an idea of what to expect from credit cards. Credit card is an option and not a necessity. Before you get one, try to consider if you need it or want it
Hi, Thanks for your comment. It’s true what you say. Some people feel pressured when they walk into a store by a credit card sales person. They tell them they can get discounts and 15% off their order if they apply for the card today. Like you say though, ask yourself, “do you need the card”. Most often I’ m betting it’s no. Thanks. Mr.CBB
I like my Discover It card because they charge no foreign transaction fees and I travel quite a bit. As far as prepaid cards go, you might think they are not so good, but they are a life saver for people who cannot get a credit card due to bad credit. Everyone can get approved and they can be used everywhere just like a regular credit card. They can be great for budgeting your monthly expenditures as well. Just shop around for the ones with the low or no activation fee and you’ll be all set.