It’s always an exciting time when you’re looking at getting a new credit card. If you do everything right, you should end up with a great card that will significantly enhance your financial life. The first step to doing that, though, is to compare credit cards Canada using certain expert criteria. We’ve created a list of four things to look for when you’re pitting different cards against each other; the one that comes out on top in as many of these categories as possible will be one of the best choices for you.
1. Interest Rates
One of the most obvious things that separates different credit cards in the Canadian market is the interest rate that they ask you to pay on the balance you carry on them. While not everyone will end up paying any interest fees when using a credit card, it takes perfect behaviour to avoid it, so it makes sense to take precautions while you can. Generally speaking, the rates you’ll pay on most cards will be around the same 20% mark across the board. However, there are exceptions to this rule, and those are worth seeking out if you worry about racking up a balance that you can’t immediately pay. There is also a lot of variation in the rates on low-interest cards specifically, where getting the best possible deal is even more of a priority. Depending on how you tend to use your card, optimizing the one you choose in this regard could potentially save you hundreds of dollars a year. In our estimation, that makes it worth checking out.
When most people sit down to find the credit card they want, rewards are the first thing on their minds. You need to think about both what kind of rewards you want (you can choose from general rewards, travel rewards, cash back, or some specialized programs like Scotiabank’s SCENE system) and how quickly you want to be able to earn them. Different cards will provide rewards at different rates depending on how much you spend and what you buy with that money, and that is something you should look at when you begin to compare credit cards Canada.
It goes without saying that everyone wants to earn as much as possible, but cards with better rates often come with trade-offs – they might be harder to get, or they might be more expensive to keep (see below). Some people might prefer to settle for something a little lesser in this department if they are able to preserve their advantage in these other ways. It’s up to you to decide what matters more to you, and there’s no wrong answer to that question. As long as a provider is willing to give a particular card to you, it could be a good option for you.
3. Other Fees
Interest fees aren’t the only costs you’ll be paying when you get a new credit card, and you should always account for those when making your decision. The most common extra fee you might be asked to pay is an annual fee, which could be anywhere from a few dollars a month to over a hundred dollars a year. Free cards exist as well, but choosing them often means giving up the chance to access higher reward rates and many different useful benefits that they might come with. We’ll get more into the specifics of that below, but suffice it to say that many of those potential benefits are more more than worth the annual fee all on their own. Whether you’d prefer one or the other is a matter of personal preference. Some people hate having to pay for a credit card no matter what extras they could get by doing otherwise, while others want to secure every possible advantage they can no matter what the final cost might be. This may also be a decision that requires you to examine a specific offer before you can properly make up your mind.
Aside from that, though, there are other fees you might possibly want to look at. Some credit cards charge extra for things like going over your credit limit, for making a payment for which you didn’t actually have enough funds, or for administrative extras like sending you paper statements. Almost all cards have extra fees baked into them somewhere, although they aren’t necessarily as high or as numerous in each case. The nice thing about this is that these are often avoidable for the most part. In general, you want to aim for a card with as few as possible, but you may be willing to compromise on this when a really good card has some extra charges attached to it that you don’t expect to have to pay often (if at all).
4. Fun Extras
This isn’t a universal rule, but at least some of the many credit cards out there offer you more than just the chance to use credit and earn rewards. Many also include benefits of some kind. Lower-end cards won’t have too much for you in this regard, perhaps throwing in a little bit of car rental insurance or mobile device insurance as a token measure of appreciation. Since they’re usually also free, that’s a nice little extra to have. The better, more expensive cards, though, give you considerably more. Most will include a set of travel insurance that covers you for everything from lost baggage to medical help while you are away. Some also get you access to exclusive privileges for things like first-choice tickets to popular events. These things make having a credit card an even better experience, and if you can secure them for yourself, you should.
Ready To Compare Credit Cards Canada? Our Tools Can Help
Sitting down to compare credit cards Canada is a task that can take a big chunk out of your day if you let it; there’s a lot to read if you want to do a thorough job. The better way to get this information is through a company who knows what to look for and has already compiled the relevant information for you. That’s what we do at Bonsai Finance. Our easy-to-read reports compile all the details you need to figure out which of the cards available is the one you really want. Once you know that, all that’s left for you to do is apply for it.