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
Stormy Daniels describes meeting Trump during occasionally graphic testimony in hush money trial
Stormy Daniels took the witness stand Tuesday at Donald Trump's hush money trial, describing for jurors a sexual encounter the porn actor says she had with him in 2006 that resulted in her being paid off to keep silent during the presidential race 10 years later.
Indian envoy warns of 'big red line,' days after charges laid in Nijjar case
India's envoy to Canada insists relations between the two countries are positive overall, despite what he describes as 'a lot of noise.'
Susan Buckner, who played spirited cheerleader Patty Simcox in 'Grease,' dead at 72
Susan Buckner, best known for playing peppy Rydell High School cheerleader Patty Simcox in the 1978 classic movie musical 'Grease,' has died. She was 72.
Former homicide detective explains how police will investigate shooting outside Drake's Bridle Path mansion
Footage from dozens of security cameras in the area of Drake’s Bridle Path mansion could be the key to identifying the suspect responsible for shooting and seriously injuring a security guard outside the rapper’s sprawling home early Tuesday morning, a former Toronto homicide detective says.
Jeremy Skibicki has 'uphill battle' to prove he's not criminally responsible in Winnipeg killings: legal analysts
Accused killer Jeremy Skibicki could have a challenging time convincing a judge that he is not criminally responsible for the deaths of four Indigenous women, a legal analyst says.
Alcohol believed to be a factor in boating incident after 2 men die: N.S. RCMP
Two Nova Scotia men are dead after a boat they were travelling in sank in the Annapolis River in Granville Centre, N.S., on Monday.
Northern Ont. woman makes 'eggstraordinary' find
A chicken farmer near Mattawa made an 'eggstraordinary' find Friday morning when she discovered one of her hens laid an egg close to three times the size of an average large chicken egg.
Bye-bye bag fee: Calgary repeals single-use bylaw
A Calgary bylaw requiring businesses to charge a minimum bag fee and only provide single-use items when requested has officially been tossed.
CFL suspends Argos QB Chad Kelly at least nine games following investigation
The CFL suspended Toronto Argonauts quarterback Chad Kelly for at least nine regular-season games Tuesday following its investigation into a lawsuit filed by a former strength-and-conditioning coach against both the player and club.