[ANALYSIS] TD Cash Back Visa Infinite Card

TD has introduced a new cash back credit card. This is very exciting news actually. But before I get too excited, let’s break down the benefits and features of this credit card. Below are the highlights:

TD Cash Back Visa Infinite Card

• $120 annual fee
• $50 annual fee for supplementary cardholders
• Earn 6% cash back on gas, grocery and recurring bill payments (for the first 3 months or first $3,500 in spending)
• Earn 3% cash back on gas, grocery and recurring bill payments thereafter (on first $15,000 in annual spending per category, including the 3 month bonus promotion)
• Earn 1% cash back on all other purchases

Breakdown

I am not a fan of the annual fee; however, let’s find out if the multiplier bonuses make it worthwhile.

When earning the 6% cash back on $3,500, you receive a maximum of $210 cash back (6% x $3,500). With 3% bonus, you earn a maximum of $1,245 cash back ($41,500 x 3%). If you subtract the annual fee, you will receive a net of $1,135 cash back ($1,255 – $120) on the first year of having this credit card, due to the extra 6% bonus.

However, in the subsequent years, you will earn $1,350 cash back (3% x $45,000 – $120) of multiplier bonus.

Comparison

If you compare to the Tangerine Money-Back Credit Card where you can earn 2% cash back on 3 categories of your choice, with no annual fee, after spending $45,000, you would earn $900 in cash back.

But if you compared similar cards from Scotiabank and CIBC (which earn 4%), then you will see that the TD card is not that great.

Scotia Momentum Visa Infinite Card

• $99 annual fee (first year fee waived if you apply before July 31, 2017)
• $30 annual fee for a supplementary cardholder
• Earn 4% cash back for every $1 spent on gas and grocery purchases
• Earn 2% cash back for every $1 spent on drug store purchases and recurring bill payments
• Earn 1% cash back for every $1 spent on all other purchases

Earn 4% on the first $25,000 annually on gas and groceries, as well as earn 2% on $25,000 of drug store purchases and recurring bill payments.

CIBC Dividend Visa Infinite Card

• $99 annual fee (first year fee waived if you apply before June 30, 2017)
• $30 annual fee for a supplementary cardholder (maximum 3 cards)
• Earn 4% cash back on all purchases (in the first 6 months, up to $5,000 in spending) (if you apply before June 30, 2017)
• Earn 4% cash back on gas and grocery purchases
• Earn 2% cash back on Tim Hortons and TELUS purchases
• Earn 1% cash back on all other purchases

The 4% and 2% bonuses are on the first $80,000 in net annual card purchases (meaning all card purchases by all cardholders, at any type of merchant) or $20,000 on gas, grocery, TELUS or Tim Hortons purchases.

Conclusion

The 6% offered by TD is a nice advertising campaign, but when you break it down, it is not very lucrative. Having the first year annual fee waived is more value back to the new cardholder.

I would have rather that TD team up with another airline or hotel program. It really looks like the cash back war is on!