Canadians switching to no annual fee credit cards to save money: survey
Canadians love to use credit cards and collect rewards for free flights, groceries or to get cashback.
A new survey by J.D.Power found that during the pandemic many have decided to ditch their annual fee credit cards in favour of cards that don’t charge a fee.
Over the past year, 22 per cent of credit card customers switched to a no-annual-fee card to save money.
“It seems there is more of a preference or a move towards no-fee cards. Not having an annual fee on your credit card is important for some consumers right now," John Cabell, J.D. Power’s director of banking and payments intelligence, told CTV News Toronto.
Many Canadians use a credit card that is issued by their bank, but the 2021 Canada Credit Card Satisfaction Study found it may also be a good idea to check around to see what other financial institutions are offering.
“Issuers are issuing new types of credit cards all the time, so there could be new products out there that you are not familiar with that might fit your needs better," Cabell said.
The survey found that Tangerine Bank, Canadian Tire and PC Financial came out as the top three cards when it came to benefits, services and rewards.
2021 Credit Card Satisfaction Survey
- Tangerine Bank
- Canadian Tire
- PC Financial
- American Express
- Desjardins
- RBC Royal Bank
- Capital One
- Scotiabank
- CIBC
- National Bank
- BMO Bank of Montreal
- MBNA
- TD Canada Trust
Before the pandemic, a popular choice for rewards was cards that allowed you to collect points towards flights and hotel stays, but with many people not travelling, 22 per cent have postponed reward redemption for more than a year.
The number of customers choosing travel rewards cards through the comparison website Ratehub.ca has dropped by about 50 per cent.
“The fact is that a lot of Canadians don't want travel points if they are not going to use them any time soon and would rather have cold hard cash in their bank account or credit card,” Mikael Castaldo with Ratehub.ca told CTV News Toronto.
Ratehub allows you to compare credit cards depending on whether you want to earn rewards or pay low interest.
Castaldo said it's best to do research to find a card that's best for the type of spending you do and make sure the rewards you're collecting aren't costing you money.
“Rewards are great when you're paying off your card and you have no balance, but if you are in a situation where you're paying interest, you're missing payments and paying annual fees that can quickly cancel out your rewards," Castaldo said.
Some users take out multiple credit cards to chase rewards, a practice known as “churning.” However, while you may collect extra points, the practice could damage your credit score.
CTVNews.ca Top Stories
How quietly promised law changes in the 2024 federal budget could impact your day-to-day life
The 2024 federal budget released last week includes numerous big spending promises that have garnered headlines. But, tucked into the 416-page document are also series of smaller items, such as promising to amend the law regarding infant formula and to force banks to label government rebates, that you may have missed.
Which foods have the most plastics? You may be surprised
'How much plastic will you have for dinner, sir? And you, ma'am?' While that may seem like a line from a satirical skit on Saturday Night Live, research is showing it's much too close to reality.
opinion I've been a criminal attorney for decades. Here's what I think about the case against Trump
Joey Jackson, a criminal defence attorney and a legal analyst for CNN, outlines what he thinks about the criminal case against Donald Trump in the 'hush money trial.'
$3.8M home in B.C.'s Okanagan has steel shell for extra wildfire protection
A home in B.C.'s Okanagan that features a weathering steel shell designed to provide some protection against wildfires has been listed for sale at $3.8 million.
Diver pinned under water by an alligator figured he had choice. Lose his arm or lose his life
An alligator attacked a diver on April 15 as he surfaced from his dive, nearly out of air. His tank emptied with the gator's jaws crushing the arm he put up in defence.
Psychologist becomes first person in Peru to die by euthanasia after fighting in court for years
A Peruvian psychologist who suffered from an incurable disease that weakened her muscles and had her confined to her bed for several years, died by euthanasia, her lawyer said Monday, becoming the first person in the country to obtain the right to die with medical assistance.
Mystery surrounds giant custom Canucks jerseys worn by Lions Gate Bridge statues
The giant stone statues guarding the Lions Gate Bridge have been dressed in custom Vancouver Canucks jerseys as the NHL playoffs get underway.
Celebrity designer sentenced to 18 months in prison for smuggling crocodile handbags
A leading fashion designer whose accessories were used by celebrities from Britney Spears to the cast of the 'Sex and the City' TV series was sentenced Monday to 18 months in prison after pleading guilty in Miami federal court on charges of smuggling crocodile handbags from her native Colombia.
Wildfire leads to evacuation order issued for northeast Alberta community
An evacuation order was issued on Monday afternoon for homes in the area of Cold Lake First Nation.