If churning came to an end tomorrow, because all banks completely shut it down, then we will need to decide which credit cards we would want to retain over the medium and possibly long term.
What makes a credit card attractive to sign up for, is the sign up bonus, which helps alleviate the pain of the annual fee. In some cases, the annual fee is even waived the first year. The decision that most people have to make is whether we want to retain the credit card beyond the first year, when we no longer have another sign up bonus or fee waived. I would always recommend trying to call your credit card company to find out if they can waive the annual fee upon renewal. You won’t know till you ask.
But let’s say we are left with no choice other than to cancel or pay the fee, below are some of the credit cards that I look into keeping beyond the first year. I listed only the highlights relevant to why I would retain each credit card.
- $75 annual fee
- Earn 1 annual coach Companion Fare
The annual coach companion fare can definitely help cover the $75 annual fee easily if you can take advantage of it.
- $99 annual fee
- Receive 1 annual round-trip companion voucher with choice of: $99 for Canada and the Continental United States, $299 for Hawaii, Mexico, Central America and the Caribbean or $399 for Europe (not including taxes, fees and charges)
Another sweet companion fare voucher. There are a few terms and conditions to watch out for, but once you take advantage of it, it definitely justifies the $99 annual fee.
- $120 annual fee (waived the first year)
- Earn 15 nights credit every year (give Silver elite status)
- Receive 1 anniversary bonus free night stay at a Category 1-5 hotel every year
The anniversary free night stay and 15 nights credit every year definitely covers the $120 annual fee on a yearly basis.
- $120 annual fee
- Spend $30,000 a year (anniversary year of having the credit card) to receive an automatic upgrade to Starwood Gold Preferred Guest membership
- Spend $40,000 a year (anniversary year of having the credit card) to receive a Free Weekend Night Award
If you can reach the spending bonus requirements on a yearly basis, it definitely justifies the $120 annual fee on a yearly basis.
- $499 annual fee
- Receive a 2-for-1 short-haul flight reward when you redeem 15,000 Aeroplan miles
- Receive access to Air Canada Maple Leaf Lounges and Arrival Lounges
- Priority check-in where Executive First and Executive Class is available
If you can take full advantage of all the above features and benefits, you can definitely get a lot of value from this credit card.
- $699 annual fee
- Lounge access (Airport Club Program, Canadian Platinum Lounge Benefit, Priority Pass)
- Elite status with hotel chains: Club Carlson (Gold), Fairmont Hotels & Resorts (Platinum membership after charging 5 nights to the card), Hilton HHonors (Gold), Le Club Accorhotels (Platinum) and Starwood Preferred Guest (Gold)
- Avis (up to 25% discounts on rentals in North America and 20% discounts internationally) and Hertz (Complimentary Car Upgrade)
- $200 Annual Travel Credit
- Receive a complimentary and discounted companion tickets and upgrades
Just like the credit card immediately above, if you can take full advantage of all the above features and benefits, you can definitely get a lot of value from this credit card.
Below is a list of credit cards that may not have very impressive features and benefits, but they do offer some decent earning ratios on spending (which I provided in brackets), which help justify the annual fee if you have high enough spending. Also, if you have high enough spending, you should always push to get the annual fee waived on each of these credit cards.
- MBNA World Elite MasterCard ($89 annual fee, earn 2 points per dollar on all spending)
- CIBC Dividend Visa Infinite Card ($99 annual fee, earn 4% cash back on gas and grocery purchases and arn 2% cash back on Tim Hortons and TELUS purchases)
- Scotia Momentum Visa Infinite Credit Card ($99 annual fee, earn 4% cash back for every $1 spent on gas and grocery purchases and earn 2% cash back for every $1 spent on drug store purchases and recurring bill payments)
- BMO World Elite MasterCard ($150 annual fee, 2 points per dollar on all spending)
- Capital One Aspire Travel World Elite MasterCard ($150 annual fee, 2 points per dollar on all spending)
Should I have included any other credit cards in the list?