The Three Cards (Nearly) Every Canadian Should Have

There are three credit cards I feel every Canadian that doesn't have a specific better card should have. They are all free, and each have non-overlapping special features. Best of all, they are on separate networks - carrying these cards will mean you should never be left unable to pay!

Card 1: MBNA SmartCash

Why?

• 2% cash back on gas and groceries, up to $400
• 1% back on everything else up to $850
• MasterCard

Actually there are two separate 'pots' the cash back comes from; 1% on $1250 total 'everything', and an extra 1% on $400 for gas/groceries; if you spend $1250 on non-gas/grocery purchases, you will only get the 1% bonus on the $400.


For sure, this card is no longer as good as it once was. If you earn more than $60k, you will likely get the 'World' version of this card, which has no cap on the 1% cash back.


This is, I believe, the only free card with 2% cash back on gas and groceries. While the limit for this 2% is relatively low, the good news is that you can have more than one of these cards; the even better news is that, for the first 6 months, you get 5% back (or rather, 1% base + 4% bonus rather than 1% bonus) on gas and groceries.

Card 2: Chase Amazon.ca

Why?

• 2% cash back on Amazon.ca
• 1% cash back everywhere else (includes Amazon sites not in Canada)
• No foreign exchange fee
• Visa

The third point here is the biggest - most cards in Canada charge 2.5% to spend money in a foreign currency, where this card charges nothing. Assuming you don't have a US$ source of income, that's huge - vs every other card, it's 2.5% better.

Card 3: American Express SimplyCash

Why?

• Flat 1.25% cash back everywhere (better than both the previous two cards)
• It's an American Express. They backdate your 'membership date', and account age, to that of your original date of getting a card with them.
• Also, if you move overseas, you can do a global product transfer - and the card in the new country will ALSO have its membership date the same as the first card you got with them.
• 5% cash back on gas/groceries/restaurants for the first 6 months (capped at $250)

'Average age of accounts' is a significant factor in credit scoring. Being able to open a new account and have it increase, rather than decrease, your average age of accounts is huge. For every other new account, it will show as brand new. If you only have 3 accounts and open one more, your AAoA will drop by 1/4 for a new account! For people wishing to churn sign up bonuses, again, this is huge.


Over the years I have found Amex to be very pleasant to work with; you don't need to be a high spender to get this card, and having it sooner rather than later can make a large difference in the years to come.

Final Thoughts

None of these cards gives an amazing sign up bonus (I'll come to those in later posts), and there are certainly better cards out there *if* they meet your spending habits.


For the Chase Amazon card, you can sign up here - and get a $20 Amazon credit on approval.


For MBNA, the card can be signed up for through Great Canadian Rebates but there is no cash back offer at the moment. There are plenty of other MBNA cards that DO have sign up bonuses, though.


For the Amex, there is a $25 sign up bonus through Great Canadian Rebates. There is also a 'preferred' version of this card, which gives flat 1.5% cash back (vs 1.25%), and has travel insurance (including emergency medical). However, it does carry an annual fee (which is waived for the first year).