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Credit Card Hacks: How to make the most of your credit card

A credit card used properly can save you money and time. Here are some invaluable tips and tricks for using your credit card.

Credit cards can be a powerful sidekick in any Canadian’s spending arsenal. They’re incredibly useful and flexible, and can come with all manner of great features such as complimentary insurance coverage, waived foreign transaction fees, airport lounge access, concierge services, shopping coverage and discounts on a range of products and services.

But the value of these benefits can be reduced severely by fees or interest rates if you fail to use a credit card properly. Read on to find out how to get the most value from your card.

Credit card hacks:

Take a moment to read through all of these credit card hacks for more information about your card – and how to use it.

    1. Carefully read all of the terms and conditions. It doesn’t take much of your time to go through a booklet of terms and conditions, so it’s surprising more people don’t read them – especially considering most will use their credit card every day or at least every week. The terms and conditions booklet will explain to you any fees and charges, and how features such as rewards programs work.
    2. Use balance transfer credit cards to reduce debt. A balance transfer is a low or 0% promotional interest rate given to those who transfer their existing credit card balances over to a new credit card. The rate usually lasts for a number of months, and allows you to make more progress paying your balance off without the usual high interest charges. There are usually rules surrounding balance transfers, such as a limit to how much you can transfer.
    3. Negotiate. If you’ve been a good customer to the credit card provider, you can sometimes negotiate in the event that you can’t make a payment or are charged a fee. If you’re having trouble paying off your balance, it’s worth a try to negotiate lower interest rates as well.
    4. Pay more than the minimum. Paying only the minimum repayment will increase the cost of your debt and the time it’ll take you to pay it off. Paying more than the minimum repayment can drastically increase the amount of your repayment going towards the actual balance rather than the interest. On a balance of $1,000 with a rate of 18.5% and minimum repayments of 2% of the balance, you’ll pay your debt off in just over eight years. Your debt will also increase to $1,924 because of interest. If you bumped up your repayments to only $50 a month, this debt would be paid off in two years and only cost a total of $1,183.
    5. Sign your card. If your card ever gets stolen, a thief can sign the back of it and proceed to use it. If you haven’t done so, sign the back of your card so it’s harder for a criminal to get access to your account.
    6. Change your PIN often. Changing your PIN every few months can help to protect your finances and ward off any fraud attempts. You can usually change your PIN at an ATM, your local bank branch, over the phone or via your online banking.
    7. Have different cards for different purposes. If you need to carry a balance over from one month to the other, consider applying for a low interest rate card. When travelling overseas, it’s wise to use a card that charges no foreign transaction fees. If you usually pay off your balance in full, look for a rewards, cash back or travel credit card.
    8. Have a separate business expense credit card. Even if you’re running a small business, you can keep track of your business expenses easily by using a card for businesses purposes only. This can help greatly when it comes to tax season.
    9. Use price protection. Some premium cards offer this feature where you can receive a refund on the difference between the item with a better price and the original one within 30 to 90 days. This feature can save you a lot of money in the long run.
    10. Use the included purchase protection. Many premium cards will give you purchase protection if you use the card to purchase an item. This protection usually covers the cost of repairing or replacing the item if it’s lost, stolen or damaged.
    11. Pay your balance in full every month if possible. The perfect credit card scenario involves paying off your balance in full every month. This means you won’t pay interest on your card, only annual fees – if there are any. Credit cards come with interest-free days, and if you pay your balance off in full within these days, you can avoid interest altogether.
    12. Choose reward programs with rewards that you’ll actually use. If you’re a frequent traveller, get a card that offers miles or points that can be used towards flights, car rentals and hotel stays. If you’re a big spender, consider a general rewards card. Estimate the value of the rewards you’re likely to receive in a year with a rewards card and compare this to the annual fee you’ll have to pay to determine the value.
    13. Cash back cards can be a good way to minimize costs. Some rewards credit cards allow you to get cash back on your purchases, which can help you better manage your costs and get rewarded for your spending.
    14. Look for rewards offers when comparing cards. If you’re looking for a rewards credit card, have a look at welcome bonus points offers. These can kickstart your points balance and help you get closer to your points goal.
    15. Keep track of your expenses. It’s a good idea to track all of the spending on your card. This can help you identify where you need to cut down on spending. Some online banking apps provide expense charts which can be a handy tool to make use of.
    16. Know what your credit card provider counts as a cash advance transaction. Cash advance transactions typically include ATM withdrawals, gambling transactions, buying foreign cash, traveller’s cheques or money orders, buying and/or loading up a prepaid credit card and some bill payments. As always, this depends on the specific card provider, but it’s essential to know before you make a transaction.
    17. Use the right card when travelling. Most Canadian credit cards used overseas (or at online international retailers) will incur foreign transaction fees, in addition to the usual interest charges. There are credit cards which waive foreign transaction fees, so consider applying for one before travelling to save you around 2.5% on every overseas purchase.

Compare credit cards offers by category

Name Product Welcome Offer Rewards Purchase Interest Rate Annual Fee Min. Credit Score Description
RBC Cash Back Mastercard
N/A
Up to 2% cash back
19.99%
$0
Min. recommended credit score: 650
Get 2% cash back on grocery store purchases, and up to 1% cash back on all other qualifying purchases and pre-authorized payments.
BMO CashBack Mastercard
5% cash back
Up to 3% cash back
19.99%
$0
Min. recommended credit score: 660
Get 5% cash back on all eligible purchases in the first three months of card membership (up to max. spend of $2,500). Plus, get a rate of 1.99% on balance transfers with a 1% balance transfer fee for nine months.
Scotiabank Passport Visa Infinite Card
35,000 points
Up to 2 points per $1 spent
19.99%
$139
Min. recommended credit score: 750
Earn up to 35,000 bonus Scene+ points in your first year (that’s up to $350 towards travel). Apply by July 4, 2022.
Tangerine World Mastercard
10% cash back
Up to 2% cash back
19.95%
$0
Min. recommended credit score: 600
Earn an extra 10% cash back (up to $100) on up to $1,000 of everyday purchases in the first 2 months Until May 31, 2022. Plus, get a 1.95% interest rate on balance transfers for the first 6 months (valid within the first 30 days of account opening, 1% transfer fee applies).
Simplii Financial Cash Back Visa Card
10% cash back
Up to 4% cash back
9.99% intro APR for the first 6 months, 19.99% thereafter
$0
Min. recommended credit score: 650
Get 10% bonus cash back at eligible restaurants and bars for the first 4 months (up to $500 spend). Plus, get a 9.99% introductory annual interest rate on purchases for the first 6 months.
RBC Avion Visa Infinite
55,000 points
Up to 1 point per $1 spent
19.99%
$120
Min. recommended credit score: 650
Get up to 55,000 Welcome Points. Get 35,000 points on approval and 20,000 bonus points when you spend $5,000 in your first 6 months. Apply by September 16, 2022.
Scotiabank SCENE Visa Card
5,000 points
Up to 5 points per $1 spent
19.99%
$0
Min. recommended credit score: 660
Earn 5,000 bonus Scene+ points when you spend a minimum of $750 on eligible purchases in the first three months as a new SCENE Visa cardholder. Apply by August 31, 2022.
OFFER
Tangerine Money-Back Credit Card
10% cash back
Up to 2% cash back
19.95%
$0
Min. recommended credit score: 600
Earn an extra 10% cash back (up to $100) on up to $1,000 of everyday purchases in the first 2 months Until May 31, 2022. Plus, get a 1.95% interest rate on balance transfers for the first 6 months (valid within the first 30 days of account opening, 1% transfer fee applies).
EXCLUSIVE
Neo Financial Mastercard
Get $25.00
Average 5% cash back
19.99% - 24.99%
$0
Min. recommended credit score: 600
Get $25 when you sign up for the Neo Financial Mastercard. Plus, earn bonuses like 15% cashback on your first purchase at most partners, and earn an average of 5% cashback at thousands of partners and at least 1% cashback guaranteed.
RBC Rewards+ Visa
3,500
Up to 2 points per $1 spent
19.99%
$0
Min. recommended credit score: 650
Earn up to 3,500 RBC Rewards points by going digital in the first 60 days.
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Bottom line

When choosing a new credit card, it’s important to understand the terms and conditions of the card in question. Doing research and comparing different cards is essential in order to find the right credit card for your needs and spending habits. If you have existing credit cards, read and understand the terms and conditions so you know what costs and rewards you can expect. When used incorrectly, a credit card can cost you thousands of dollars in interest each year and contribute to damaging your credit score, but when used properly, you can take advantage of interest-free days, rewards points, cash back and much more.

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