I’m on holidays for the next two weeks. Globe and Mail personal finance reporters Erica Alini and Salmaan Farooqui will be writing this newsletter in my absence. Talk to you in February!
A reader got in touch recently about what he thinks is a candidate for best reward credit card.
“Take a look at the Scotiabank Gold American Express card,” he wrote by e-mail. “I can’t find any other card where you get those kind of earn rates.”
There are actually a couple of things to like about this card, one of them being that it does not charge the usual 2.5 per cent fee on transaction in foreign currencies. The other is, yes, the earn rate. You get six points for every $1 you spend at grocery stores in the Sobey’s, Safeway, FreshCo and Foodland chains, five points per $1 on restaurant meals, takeout and entertainment, three points per $1 for gas and transportation expenses as well as some streaming services, and one point per $1 for other purchases. The best I’ve seen from other cards is a maximum of five points per dollar spent in certain categories.
How does Scotiabank Gold American Express compare overall, though? For some thoughts, I reached out to my go-to card expert, Patrick Sojka of Rewards Canada. “Yes, the Scotia Gold American Express Card is a points-earning machine,” Mr. Sojka said by e-mail. In fact, he slotted it in at No. 1 among travel points cards with an annual fee in a recent ranking. According to Mr. Sojka, the Scotia card’s six points per dollar earn rate is the highest of any card in Canada.
The card didn’t rank as the top travel reward card overall, though. The reason why highlights the need to study the reward scheme for any credit card before signing up. Mr. Sojka explains that when you redeem points for travel, dining, movies and groceries with Scotiabank American Express Gold, you get a better reward rate than if you redeem for cashback or statement credits.
The travel rewards card Mr. Sojka considers the best in Canada, Amex Cobalt, offers a maximum five points per dollar spent. But the value you get from those points is the same, whether you use them for travel or cashback. Mr. Sojka said Cobalt can also offer strong value if you convert points to airline reward programs such as Aeroplan, or book travel through Amex using the Fixed Points Travel Program. This program offers flights for a pre-set number of points.
Mr. Sojka said it’s a toss-up between Cobalt and Scotiabank Gold American Express for someone who won’t use the Amex fixed points program or convert to Aeroplan. If you shop at Sobey’s regularly, then the Scotia card is the way to go.
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Rob’s personal finance reading list
The year in charts
People in the financial industry highlight the charts and data they think will be crucial in 2023. A must-read if you’re curious about what’s coming for inflation, interest rates, wage increases and more.
Best budgeting apps for 2023
A helpful and thorough list of apps to help you track and manage your spending.
Seven totally sad Toronto rentals
Affordable rentals? Yup, Toronto has ‘em. How about $495 per month for a 134-square-foot room that is “perfect for someone who wants to avoid direct sunlight.”
A surefire way to cut car costs
The public transit systems in Vancouver, Montreal and Toronto rank among the Top 10 in North America.
Ask Rob
Q: Our son is planning a visit to Australia and New Zealand in March. We would like to give him some extra spending money for the trip. What would be the most cost-efficient way to do this? Are traveller cheques still an option or should we just pay into his credit card account?
A: I’m going to suggest prepaid cards. Prepaid travel cards offered by Visa and Mastercard are one option, while another is a travel card from a company called Wise that specializes in international money transfers. The Wise card can hold multiple currencies, including Australian and New Zealand dollars.
Do you have a question for me? Send it my way. Sorry I can't answer every one personally. Questions and answers are edited for length and clarity.
Today’s financial tool
Year by year returns for U.S. stocks from 1872 to 2022. A timely reminder that stocks go up a lot more than they fall in price.
The Money-Free Zone
Here’s a typically terrific song from the English post-punk band Shame – Fingers of Steel, which will be on an upcoming album.
Listen to this
NPR’s Planet Money podcast looks at the economic lessons in books for kids.
From the Twitterverse
A thread that started with a tweet about a Dutch grocery chain with a “slow” checkout lane for seniors who want to take time to chat.
ICYMI
- For financial stability, we need more insurance on customers’ bank deposits
- $37 chicken wasn’t Galen G. Weston’s fault, but Loblaw needs to repent nonetheless
- Claim key deductions and credits to reduce your tax burden
More Rob Carrick and money coverage
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Even more coverage from Rob Carrick
- 🎧 Catch up on Stress Test: Is the middle class dead for millennials and Gen Z? • Gas prices are soaring. Are electric vehicles an affordable solution? • Crypto is booming, but should you invest? • How are young Canadians dealing with soaring rents? • Inflation is squeezing our finances. What can we do about it? • Is a hot housing market squeezing Canadians out of their small towns?
- ✔️ The housing file: How bad is housing affordability? Even a crash won't help • Sell the family home to lock in profit and then rent? Better not • Why young adults can't afford houses: Hard work got you more in the past than it does now • Five reasons you should not buy a house till you're at least 30 • Now more than ever, owning a house is not a retirement plan
- 📈 Investing: The 2022 ETF buyer's guide: Best Canadian equity funds • The 2022 Globe and Mail digital broker ranking: Does the zero-commission revolution flip the script on who's best? • With bonds sinking, conservative investors are waking up to risks they never saw coming • A five-step plan for dealing with the sad fact that almost every investment is falling lately • The best financial advice in advance of retirement? Work on your marriage • One-year GICs are the best deal in town for safety seekers • What to do if the financial plan you paid thousands for disappoints
- 💰 Your money: Are you prepared for the pandemic wealth boom to blow up in our faces? • This hard-working 24-year-old is nailing it financially. But where’s the happiness? • Who should and shouldn’t worry about the wave of rate increases this year, and what every stressed-out borrower should do right now • Don’t make this potentially costly assumption about the CPP Survivor’s pension
