12 Ways To Master The Credit Card Rewards Game In Canada

12 Ways to Master the Credit Card Rewards Game in Canada

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Last updated on December 28, 2022 Comments: 4

They’re fun, liberating, enriching, exhilarating, frustrating and distressing. They make every purchase an aspirational event, and every redemption an exercise in despondency. But we love ’em! More than any other people in the world, Canadians love to earn, burn and churn their cash, points and miles. Play the game like the masters, and you’ll have the chance to fly free, stay free, and fatten your wallet in spades. Here’s a primer on how to exploit the banks’ insatiable appetite for growth and increase your earning power.

1. Loyalty Doesn’t Pay

When do you get the most value from your rewards credit card? When you get a new one, or threaten to. Not unlike insurance, wirelesss and cable, the best incentives are reserved for new customers, or those threatening to leave. Think about it: It may take you $25,000 worth of spend, and a couple of years, to earn 25,000 miles on your current credit card. Or, you can get a new credit card with a welcome bonus of 25,000 miles and all you’ll have to spend is $500 in 3 months to meet the minimum spend requirement.

2. Let Issuers Pay You to Try Their Credit Card

When you buy a new pair of jeans you get to try them on before you pay right? Buy an item unseen from a catalogue, it usually comes with a strong return policy correct? We’ve all had experiences with a credit card or rewards program we found underwhelming. So why do some issuers charge an annual fee BEFORE you’ve had a chance to take their service and rewards program for a test drive? If you get a new credit card, start with one that waives the first year annual fee – plenty of the best credit cards have no fee in the first year. You’ll be able to give the card a trial run, and the onus will be on the issuer to dazzle you with their service and product, before you pay for it – a pretty reasonable expectation when you consider how we shop and pay for most other items.

3. Be Patient, Wait for the Hefty Welcome Bonus Incentive

The biggest punch of value you’ll ever get from your rewards credit card will be in the welcome bonus. Issuers often have promotional periods where they offer more welcome bonus points than their usual base incentive offer – sometimes double the value. Do a little research and stay patient to wait for the best deal available. A credit card’s base welcome bonus offer may be 15,000 points, with a $120 annual fee. Wait for the right moment, and you could get the same card with a 30,000 point welcome bonus, and a first year annual fee waiver. The difference in value between the two offers may be as high as $300! That’s the time to pounce.

4. Game the Merchant Bonus Categories

One of the most valuable ways to take advantage of rewards credit cards is to spend in bonus categories where you get extra rewards. For example, you might get 5% cash back in gas, or 2 points per dollar spent at the grocery store, versus 1 point everywhere else. So how do you get 5% cash back or 2 points per dollar spent almost anywhere? Gift cards. Simply use your credit card to buy a gift card to your favourite merchant at the grocery store or gas station. As an example, use your SimplyCash® Card from American Express to buy an Amazon, Apple, Canadian Tire or Wal Mart Gift card, which applies towards the spending for the Welcome Bonus and then you can then use the gift card to make a purchase at a store your credit card would not have given bonus rewards to otherwise!  In your first 10 months as a new SimplyCash® Card from American Express Cardmember, you can earn a $10 statement credit for each monthly billing period in which you spend $300 in purchases on your Card. This could add up to $100 in statement credits in the first 10 months. Conditions apply.

Recommended Read: How to Get Free Amazon Gift Cards in Canada.

5. Easy Way To Meet The Minimum Spend Requirement

Ever want to take advantage of a huge limited-time credit card welcome bonus offer, but you’re not sure what you’re going to spend your money on to meet the $1,000 minimum spend threshold? A nice work around is to spend the minimum on a gift card at a grocery store you frequent or at a place like Amazon where you can then use the funds available on the card throughout the year.

6. Stack Those Credit Cards

Figuratively, not literally. As we mentioned above, many credit cards offer bonus merchant categories. One effective way to maximize rewards is to get multiple cards that offer bonuses in different categories, and then to get another card that offers 2% value for ALL other spend. And anyway, it’s a good thing to have at least two credit cards in your wallet at all times, just in case one gets lost, suspended, defrauded, or isn’t accepted (ahem Amex). Always have an alternative.

7. Double Dip

Some credit cards offer extra rewards points through loyalty programs like Scene+, Air Miles, Aeroplan, etc. While your credit card will give you an opportunity to earn rewards on all your credit card spend, you can get additional rewards by double dipping when you use the loyalty card at the point of sale as well. For example, at Sobeys you can collect 3x the Miles for every $25 spent at participating AIR MILES Partners* with your BMO AIR MILES®† Mastercard®*, then  your AIR MILES Collector Card at an AIR MILES Partner to earn Reward Miles from both*.

*Terms and conditions apply

8. Use Reward Malls

If you’re going to make a purchase for a specific product, or at a specific merchant, it may pay to give your credit card or loyalty program’s site a last look. Many programs such as Aeroplan’s eStore, AIRMILESshops.caAir Canada’s Duty Free Mall, offer discounts or bonus miles at popular merchants such as Amazon.ca, Gap.ca, ebay, Sears, Dell, etc. The deals coming through these online malls can double your points and offer exclusive discounts retailers don’t want made available to the general public, or just through their affiliate link. Regardless, just by going to the Gap.ca site through a link on AIRMILES, you could get additional savings for merchandise you would have bought anyways.

9. Take Advantage of Price Matching

Some credit card issuers have their own travel centres with transparent dollar pricing, meaning consumers book trips at a dollar value, as opposed to a point or grid system. However, consumers have always been leery that bank-run travel centres charge higher prices than the general market.

10. Know the Rules of the Game

Credit card rewards hold all the promise in the world, so long as you play by the rules. Not unlike the casinos however, credit card issuers have laid a host of landmines in your path to stack the deck in their favour.

  • Earning Caps: Watch out for big cash back promises, only to find out you’re getting 5% cash back up to $500 in spend, and 0% on everything else. Caps are a bummer.
  • Spending Tiers: Again, watch out for advertised cash back rates of 1%, only to find out in the footnotes, it’s on all spend above $3,000 and everything below earns you 0.5% (you know who we’re talking about)
  • Changes: Watch out for rule changes. Credit card companies are changing the terms of their reward programs all the time. Make sure the rules changes still make the card worthwhile to you.
  • Penalties: Understand how you can lose your points, like if your card goes into delinquency, or if you cancel your card
  • Fees: Are you spending enough to justify your annual fee? Did you know you get charged $35 to book your flight over the phone?
  • Expiry: Understand if your points expire after 5 years, in 12 months if you don’t earn or redeem a mile, or upon cancellation of your credit card.

11. Pay for Big Purchases with Your Credit Card

Before you make any big ticket purchase, whether it be home renovations, business, school, camp, taxes, tickets, insurance or rent, check to see if they accept credit cards. Many businesses and services that historically never accepted credit cards now do, so it’s worth an ask.

12. Don’t Get a Rewards Credit Card If…

  • You carry a balance: The interest you’ll be charged will wipe out any value you get from your rewards.
  • You’re always late: Your interest rate may jump to an obnoxious level AND you’ll lose the privilege of your grace period – wiping out the value of your rewards.
  • You consistently go over your credit limit: You’ll be charged an over limit fee of $29 or so, making the points you earned from going over your limit worthless.

Recommended Read: Best Credit Cards for Amazon Purchases.

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Author Bio

GreedyRates is Canada’s go-to resource for all things personal finance. Our expert articles and videos cover every topic under the financial sun, including credit cards, credit scores, loans, bank accounts, budgeting, investing, RSPs, TFSAs, GICs, taxes, and more. Want our advice on a personal finance issue? Send us an email at [email protected] and we’ll gladly give you some free tips.

Article comments

Harry says:

I noticed just recently in AMEX terms and conditions for earning bonus points on grocery purchases on their marriott bonvoy card that gift cards do not count as an eligible purchase. This is not good news. as your article states it makes it alot easier to get some of these bonuses if you can buy gift cards for gifts or just for yourself to use later. What is the difference, I mean I am still charging the purchase what difference is it what i buy at the grocery store…food or a gift card?

Daniel at GreedyRates says:

Hi Harry,
Appreciate your feedback on this one. It’s frustrating to be sure, but this one will fall under the ymmv category. Certain credit cards will be more lenient than others when it comes to gift card purchases a grocery stores. Premium cards that offer lucrative welcome bonuses after meeting spending thresholds will apply more scrutiny and in this case, even call it out in the T&Cs an ineligible purchase. There isn’t technically a difference, but the credit card issuer gets the last word. Hope this doesn’t sour your experience- the Marriott Bonvoy has still got a lot of perks to make it worth your while.

Penny says:

Do you happen to know if this is also the case with the Amex Reserve card? With their current 10x points on eats & drinks (including groceries) up to 50k points within the first 6 months, I thought it would be a lot easier to get all the points if I could just buy gift cards at stores eligible for the multiplier and use them everywhere else. I can’t find anything in the terms but am wondering if this is the same case.

Daniel from GreedyRates says:

Hi Penny,
You won’t know ’til you try it. I’ve heard that some gift card purchases can count towards the minimum welcome bonus threshold but there’s no guarantee that a gift card purchase from a restaurant would qualify for a multiplier. You might be able to get away with it for a couple purchases, but you might be out of luck if they catch on. Game on.