What Credit Card Should You Have at Your Income Level?
With so many credit cards available now in Canada, it can be hard to select the right one for you. Not only do you need to consider the card features that are most attractive, but you also need to determine if you qualify in the first place. After all, many of these credit cards come with minimum income requirements, not to mention annual fees that may or may not fit your budget. In this article we’ll guide you to the right card based on your income level.
Credit card income requirements in Canada are generally broken down into three different earning brackets: $0-$59,999, $60,000-$79,999, and $80,000+. The cards with a higher income requirement typically come with more benefits, but they may also come with a higher annual fee. Here are our top credit card suggestions for you based on your annual income.
Best Credit Cards for Low Income Earners (< $59,999)
There are plenty of options within this bracket, some of which offer comprehensive rewards programs and benefits and others that just cover the basics. As long as you have a good credit score and meet the income requirement, you’ll likely qualify for one of our suggested best credit cards for low income earners.
Tangerine Money-Back Credit Card
The Tangerine Money-Back Credit Card offers unusual flexibility, allowing cardholders to choose 2 merchant categories in which they will receive 2% cash back. These categories include groceries, restaurants, gas, drug stores, recurring bill payments, and more. You can earn a third 2% category if you choose to deposit your cash back directly into a Tangerine bank account. All other purchases will earn 0.5% cash back and there are zero limits, caps, or tiers for this cashback program. There is no annual fee for the Tangerine Money-Back Credit Card but you do need an annual income of $15,000 to apply. Even though this credit card is classified as a low income choice, it’s really a great cashback option for any income bracket given the ability to tailor its money-back rewards.
*Note that the card currently offers a promotion in which new cardholders will be able to earn 4% in money-back rewards in 2-3 categories of their choice. This offer is only available to those that apply by July 31, 2019.
PC Financial Mastercard
Another great credit card option for those who fall into the low-income category is the PC Financial Mastercard. Like the other two cards we’ve highlighted above, the PC Financial Mastercard has no annual fee and the required annual income is quite low, at only $12,000 to apply. Despite the minimal application requirements, it’s a great credit card for those who do a lot of their shopping at businesses that offer President’s Choice products and/or Shoppers Drug Mart/Pharmaprix. Cardholders receive 10 points for every dollar spent at participating stores where President’s Choice products are sold and 20 points for every dollar spent at Shoppers Drug Mart/Pharmaprix. Additionally, they earn 3 cents per litre in PC Optimum points (this is equal to 30 points) at any Esso and Mobil Station. Finally, cardholders will earn 25 points for every dollar spent on PC travel services and 10 points for every dollar spent elsewhere.
Best Credit Cards for Middle Income Earners ($60K-$79,999)
In terms of credit cards, middle income earners are generally classified as individuals who make between $60,000- $79,999 annually or who have a combined household income of $100,000 or more. The types of credit cards that fall into this category tend to have more perks and benefits, higher welcome bonuses, but also high annual fees. These are our top credit card picks for middle income earners.
Scotia Momentum Visa Infinite Card
Middle income earners looking for a great cashback card will want to consider the Scotia Momentum Visa Infinite Card. Cardholders can currently earn 10% cash back on their purchases (up to $200) for the first 3 months of cardmembership. After this promotional period ends, cardholders will earn 4% back for gas and grocery purchases for up to $25,000 in annual spend (spending above this limit will earn 1% cash back). Furthermore, cardholders will earn 2% cash back on pharmacy expenses and on recurring bills (again, up to $25,000, then the earn rate changes to 1%). Any other expenses will see a return of 1% cash back, with no spending limit. There is an annual fee of $99 for the Scotia Momentum Visa Infinite Card, but the fee is waived for the first year.
TD Aeroplan Visa Infinite Credit Card
New TD Aeroplan Visa Infinite cardholders can earn up to 30,000 Aeroplan Miles as a signup bonus when they apply.
Cardholders will earn 1.5 Aeroplan Miles for every $1 spent on eligible gas, grocery, drugstore, and aircanada.com purchases, and 1 Aeroplan Mile for every $1 spent elsewhere. Additional benefits and perks include one annual pass to an Air Canada Maple Leaf Lounge (if travelling on an Aeroplan redemption), discounts at select Avis Rent A Car and Budget Rent a Car businesses, and travel insurance. There is an annual fee of $120, but the fee is waived for the first year.
MBNA True Line Credit Card
– Credit score required: Fair-Good
– Balance Transfer Intro Rate: 0%
– Annual fees: $0
– Cash advance rate: 24.99%
– This offer is not available for residents of Quebec. For residents of Quebec, please click here
If you’re looking for a low interest and/or balance transfer credit card, then the MBNA True Line credit card is a great choice. New cardholders will receive a 12-month promotional balance transfer rate of 0%. Once that promotional rate ends, your interest rate goes up to 12.99%. Keep in mind that there’s also a balance transfer fee of 3% with a minimum fee of $7.50. The card doesn’t come with any additional benefits, since it’s aimed at people who are looking to reduce their debt, but on the plus side it has no annual fee.
American Express Cobalt Card
If you love good food and enjoy dining out, then the American Express Cobalt Card might be the best fit for your lifestyle. The card awards 5 points per $1 spent at eligible restaurants, bars, food delivery services, and grocery stores. Cardholders will also earn 2 points per $1 spent on eligible travel expenses, including airfare, hotels, ground transit, and gas. All other purchases will earn 1 point per $1 spent. Points can be redeemed for travel, a variety of merchandise, or toward paying off your statement. The American Express Cobalt doesn’t have a minimum income requirement per se, but you do need a good credit score to be approved and there is a fee of $10 per month.
Best Credit Cards for High Income Earners ($80K+)
Our final category is for high income earners—those who make $80,000+ annually as individuals or who have a combined annual household income of $150,000+. High-income credit cards typically come with an attractive array of benefits, and tend to have higher rewards earning potential and larger welcome bonuses. Unsurprisingly, these credit cards also normally come with a hefty annual fee (though, oftentimes, the benefits and bonuses off-set this). These are our top picks for high income level credit cards.
Rogers World Elite Mastercard
The Rogers World Elite Mastercard is a relatively new no-fee credit card that’s made a reputation for itself by offering competitive cashback rewards rates on both foreign and domestic purchases. Cardholders will receive 4% cashback rewards on foreign currency purchases, 2% cashback rewards on Rogers products and services, and 1.75% back on all other Canadian dollar purchases. The best part? These earnings are unlimited and there are no spending caps. Anyone interested in this credit card will want to note that there is a 2.5% foreign transaction fee, however thanks to the 4% in cashback rewards on foreign spending, the cardholder still comes out ahead. Those who want to apply for the Rogers World Elite Mastercard should have a good credit score and a minimum annual income of $80,000.
BMO World Elite Mastercard
The BMO World Elite Mastercard is a travel rewards card with a good earn rate and strong overall value for those who are interested in using their points toward flights. New cardholders will receive a signup bonus of 35,000 points when they charge $3,000 to their card within the first 3 months of card membership. The earn rate is 3 BMO Rewards points for every $1 spent on eligible travel, dining and entertainment purchases; and 2 points per $1 spent on all other purchases. These points can be redeemed for travel or merchandise, put toward the card balance, or invested.
Additional perks with this credit card include a very comprehensive insurance package, 4 free airport lounge passes per year, and purchase protection. The BMO World Elite Mastercard has an annual fee of $150 (the first year is waived) and requires a good credit score and minimum annual income of $80,000 to apply.
American Express Platinum Card
The American Express Platinum Card is one of the few premium cards that does not technically have a minimum income requirement, however, given its hefty annual fee of $699, we’re classifying it as a high-income card. It’s also important to note that this is a charge card, not a credit card, which means that you do have to pay off your entire balance every month if you want to avoid getting hit by the huge 30% interest rate.
The American Express Platinum Card is a popular premium card in Canada thanks to the number of top features it offers. These include: a $200 annual travel credit, unlimited airport lounge access for you and a companion, hotel status upgrades, and comprehensive travel insurance. New cardholders will also receive a signup bonus of 50,000 points when they spend $3,000 within the first 3 months, which is enough to get a return flight to the USA (including Hawaii), Central America, Mexico, or the Caribbean. Membership Rewards points are earned for every purchase: 3 points for every $1 spent on eligible dining, 2 points for every $1 spent on eligible travel, and 1 point for every dollar spent elsewhere. You can also transfer your points to Aeroplan at a 1:1 ratio or to Marriott Bonvoy at a 1:1.2 ratio.
*This post was not sponsored. The views and opinions expressed in this review are purely my own.