RATESDOTCA's Annual Credit Card Ranking Gets Straight to the Point
What offers the best value: a mile, a point, or cash back? Are annual fees worth it? How can a promotional interest rate help pay off a lingering balance?
These are some of the most common questions posed by Canadian credit card shoppers - but when it comes to choosing a card, it's not always clear which are top performers.
RATESDOTCA, Canada's comprehensive financial rates comparison site, has taken the guesswork out of picking your plastic with the 2015 Best of Finance Awards, a ranking of the hardest-working credit cards and banking products in Canada.
"It can be tricky to assess whether a credit card will help or harm your bottom line over the long run," says Penelope Graham, Editor at RATESDOTCA. "Plush signup bonuses and promised freebies may appear to provide great value, but it's important to choose a card with features that practically fit your personal spending habits."
To determine and compare the true value proposition of each card, RATESDOTCA converted rewards - from points and miles to interest promotions - to cash earned over a 24-month period, based on the average Canadian household expenditure*. The Awards also ranked the top Canadian banking and investment options.
And without further ado... The best Canadian credit cards of 2015:
The Best Credit Cards in Canada
Cash Back
WINNER: Scotia Momentum® VISA Infinite* Card
2nd Place: MBNA Smart Cash MasterCard® Credit Card
3rd Place: SimplyCash Card from American Express
Travel Rewards - With Fee
WINNER: Scotiabank®* Gold American Express® Card
2nd Place: BMO® World Elite™ MasterCard®*
Travel Rewards - No Fee
WINNER: Blue Sky Credit Card
2nd Place: Capital One® Aspire Travel™ Platinum MasterCard®
3rd Place: Shell AIR MILES®† MasterCard®* from BMO
Travel Rewards Loyalty Program
WINNER: TD® Aeroplan® Visa Infinite* Card
Grocery Rewards
WINNER: President's Choice Financial® MasterCard®
Gas Rewards
WINNER: MBNA Smart Cash MasterCard® Credit Card
2nd Place: Shell AIR MILES®† MasterCard®* from BMO
3rd Place: Shell CashBack MasterCard®* from BMO
Low Interest
WINNER: MBNA TrueLine® MasterCard Credit Card
2nd Place: National Bank Syncro MasterCard®
3rd Place: Desjardins Visa Gold Modulo
Low Balance Transfer
WINNER: Platinum Plus® MasterCard® credit card
2nd Place: President's Choice Financial® MasterCard®
3rd Place: Scotiabank Value® VISA* card
Building Credit
WINNER: National Bank MC1 MasterCard®
2nd Place: Home Trust Secured Visa Card
3rd Place: Capital One® Guaranteed MasterCard® (both secured and unsecured)
Student
WINNER: TIE - Scotiabank L'earn® VISA* card
WINNER: TIE - StudentAwards MBNA Rewards MasterCard® credit card
2nd Place: BMO SPC® CashBack® MasterCard® (DISCONTINUED)
Special Mention: Scotiabank SCENE® VISA* card
*http://www.statcan.gc.ca/tables-tableaux/sum-som/l01/cst01/famil108a-eng.htm
How Did We Choose the Winners?
Rewards Credit Cards
To calculate the return earned on each Canadian rewards credit card, we assumed the following:
- A total monthly spend on the card of $1,119.58*, divided into the following categories:
- The credit card balance was paid in full each month, with no interest charges accrued.
- The consumers always uses the card at partner retailers, if applicable (e.g. all gas purchased at Shell locations).
- All points and miles were calculated into a cash value in order to compare cards like for like.
- Spending was calculated over a 24-month period, taking into account all signup bonuses, good standing bonuses, first-purchase bonuses, annual fees and waivers.
*Source: http://www.statcan.gc.ca/tables-tableaux/sum-som/l01/cst01/famil131a-eng.htm
Low Interest Credit Cards
To calculate the value of low interest credit cards, we assumed the following:
- The cardholder is starting with the average Canadian credit card balance of $2,627*, and pays the minimum payment plus $10 monthly over a 24-month period
- The interest paid on the balance over the 24-month period is compared to that of the average credit card with a 19.99% APR.
- Total card value takes into account all signup bonuses, good standing bonuses, first-purchase bonuses, annual fees and waivers.
Low Balance Transfer Credit Cards
To calculate the value of low balance transfer credit cards, we assumed the following:
- The cardholder is starting with the average Canadian credit card balance of $2,927*, and pays a monthly installment of $218.92 in order to pay the balance within a 12-month period
- The cardholder has transferred the balance from another card to activate the promotional balance transfer interest rate and has paid a 1% fee of $26.27.
- The interest paid on the balance over the 12-month period is compared to that of the average credit card with a 19.00% APR
- Total card value takes into account all signup bonuses, good standing bonuses, first-purchase bonuses, annual fees and waivers.
