The Ultimate Travel Credit Card Portfolio for those just starting with points & miles

In this feature of Rewards Canada's Ultimate Credit Card Portfolios we look at the ultimate one for those who are just starting out on their rewards journey or for those who are looking to up their game in the world of points and miles! The portfolio focuses on credit cards that provide excellent earning opportunities, travel benefits and the widest range of rewards options. It allows you to kick start your points earning all the while giving you the time to decide how best to redeem in the future.

As we typically recommend, you should carry a Visa, a Mastercard and an American Express card in your wallet. This is standard with all of our Ultimate Wallets. The reason why is that there are benefits, promotions and earning potential unique to each brand of credit card. There are various card options that could be utilized for this portfolio but we look at one card from each issuing family that we feel are the best fit for this mission.

What is Rewards Canada's The Ultimate Travel Credit Card Portfolio for those just starting out with points & miles? It's the following three cards:

Why these three?

A quick overview as to why these three cards make up this portfolio:

• American Express Cobalt Card: This is the best overall credit card in Canada thanks to great points earning and the widest array of valuable redemption options. It is must for anyone to have in their wallet, whether you are beginner or an expert.
• HSBC Rewards World Elite Mastercard: This is the card for no foreign transaction fees, travel benefits and insurance coverage.
• TD Aeroplan Visa Infinite Card: Your card to save on baggage fees with Air Canada and to provide discounts on Aeroplan award tickets

Not only is this the ultimate portfolio for those just starting out or for those looking to enhance their points & miles game but it is a strong portfolio for seasoned rewards collectors. If you look at our other Ultimate Portfolios you'll notice these three cards are featured in quite a few of them and in fact these are the same cards that make up The Ultimate Aeroplan Credit Card Portfolio! There is a simple reason why - these cards make up three of the top five best cards overall in our Top Travel Rewards Credit Card rankings!

You have the American Express Cobalt Card which is the best card overall, you have the HSBC World Elite Mastercard which is the best No FX Fee card, and you have the TD Aeroplan Visa Infinite Card which is the best airline card. Combine them all and you have a very versatile and powerful card portfolio.

Five Key Benefits of this portfolio

• Excellent points earning
• Very good insurance coverage
• Travel Benefits
• No Foreign Transaction fees
• Wide range of reward redemption options

Why you want to get these cards

The first card in the portfolio is the American Express Cobalt Card. The amazing thing about this card is that it is not considered an entry level card yet for someone entering the points and miles world it is just the card to get. The primary reasons this card is the best to start out with are two fold. First it has no minimum income requirements, so if you have a good enough credit rating but only make $40,000 per year there’s a really good chance you can get the card. No need for $60,000 or $80,000 like some of the other top cards in Canada, which on the flip side, you will require for the other two cards in this portfolio (if you don't meet income requirements see the bottom section for 'other card options'). Second, is the card’s reward program, Membership Rewards is the best travel rewards program in Canada as it covers the complete spectrum of reward options including the two most popular which are travel and cash back.

With the Membership Rewards program providing so many options, the Cobalt card has you totally covered while you are educating yourself and learning more about the world of points and miles, no matter what you end up deciding as your primary reward goal or goals.

Reward options with the Cobalt Card:

• Redeem points towards any purchase you make on the card (including travel) Check!
• Redeem a fixed amount of points for a flight reward (your classic frequent flyer reward chart): Check!
• Convert points to airline and hotel programs (including the big 4: Aeroplan, Air France KLM, British Airways, Marriott): Check!
• Redeem points for merchandise/gift cards: Check!

Those redemption options are strengthened by the Cobalt Card being one of the strongest points earning cards in Canada. In fact, it is one of only three cards Rewards Canada considers to be a Points Earning Machine. The extremely strong points earning rates are:

• 5 Points per dollar spent at eligible restaurants, bars, grocery stores and food delivery
• 3 Points per dollar spent on select streaming services purchases
• 2 Points per dollar spent on eligible transit & gas purchases in Canada and eligible travel purchases
• 1 Points per dollar spent on all other eligible purchases

To see where you can earn these multipliers be sure to check out our American Express Cobalt™ Card Confirmed Multiplier Locations which lists hundreds of retailers from around the world where you can earn 5x, 2x and 1x points.

So not only does the card provide all those redemption options but you'll find amazing value with them, well the first three options do as merchandise/gift cards are almost always lower in value. At 5 points per dollar you are looking at a 5% return for statement credits, up to a 10% return for fixed points travel and converting points to other airlines and hotel program? The sky's the limit! Well, not really... but there is the potential for those 5 points per dollar ending up providing a 15%, 30% or even higher return!

By having all the bases covered in the grand scheme of all things in the world of loyalty rewards, the American Express Cobalt Card makes the ideal first credit card for someone just starting out. You won't be tied into one program such as CIBC's Aventura program or the BMO Rewards program or you won't be stuck with Aeroplan Points, AIR MILES Reward Miles or Scene+ points if you realize those programs are not right for you once you're more seasoned in the points and miles world. You literally have almost any reward option with this card and with some of the best points earning rates, you cannot go wrong by having it in your wallet.

The Cobalt Card Quick Facts:

• Monthly Fee $12.99 primary card ($155.88 annually), $0 for supplementary/additional cards
• Up to 15,000 points welcome bonus
• Income requirement: American Express does not have set income requirements
• Apply for this card here.
• Click here to read our in depth review of The American Express Cobalt Card

The second card in the portfolio is the HSBC World Elite Mastercard and the primary reason you are getting this card is is that it does not charge a fee on foreign transactions. This means you'll save 2.5% on average on any purchases not made in Canadian dollars. Spend 5 months down in Palm Springs each winter and don't have a US credit card? Use this card and they'll only charge you the Mastercard exchange rate when converting the purchase to C$. That can present a really big savings over most cards in Canada that charge 2% to 3% (majority are 2.5%) on foreign transactions.

The card also has excellent insurance coverage including an industry leading 21 days of out of province emergency medical coverage for those 65 and over with no age limit cap. No other card in Canada provides that duration of coverage for this age group. This benefit covers up to $2 million in expenses per insured person and you are covered when you travel just for having the card - no need to actually purchase the said travel on the card.

In terms of points earning, the card definitely holds in own by offering 6 points per dollar spent on travel (a 3% return when redeemed for travel) and 4 points per dollar spent on groceries, gas stations and drug stores (a 2% return when redeemed for travel). For all other purchases the card earns 2 points per dollar (1% return when redeemed for travel)

Being a hybrid card, this card provides a high level of flexibility that is almost on par with the American Express Cobalt Card. You can redeem for any travel purchase you charge on the card or you can convert the points to British Airways Executive Club, Cathay Pacific Asia Miles or Singapore Airlines KrisFlyer. You also have to option to redeem for cash back statement credits at a lower value than the travel redemption options. Again, just like the Cobalt Card, you are not stuck with just one option.

Finally the HSBC card also provides an annual $100 travel enhancement credit that provides some nice savings if you check bags when you pay for flights, have to pay for seat assignments etc. It also provides membership in Mastercard TravelPass by DragonPass which is a business class lounge access program. The card covers the annual fee of the membership and then cardholders received discounted rates for accessing any of the lounges.

HSBC World Elite Mastercard Quick Facts:

• Annual Fee $149 (waived in the first year with the current welcome bonus offer) $0 supplementary cards
• Up to 50,000 points welcome bonus (Apply by Sep 29, 23)
• Income requirements: $80,000 personal or $150,000 household income, or minimum of $400,000 in assets under management (based on liquid, investable assets with a financial institutions in Canada).
• Apply for this card here.
• Click here to read our in-depth review of the HSBC World Elite Mastercard

What about RBC taking over HSBC?
Recently it was announced that RBC cleared the next hurdle in acquiring HSBC by having it approved by the Competition Bureau. The deal now only requires approval from the Minister of Finance. If the acquisition is approved we can assume that eventually HSBC Canada will be absorbed into RBC. At that point we are not sure what will happen to HSBC credit cards. Will RBC keep them as separate products or will they move all those cardholders to existing RBC products and shut down the HSBC cards? Only time will tell what will happen but if RBC does end up discontinuing the HSBC cards we don't expect this to happen until sometime in mid to late 2024. That gives you at least a year to enjoy all the benefits from this card should RBC nix it.

Rounding out this portfolio is the TD Aeroplan Visa Infinite Card. You are adding this card into the portfolio primarily for if and when you fly with Air Canada (which is a lot of us!). The two main reasons for having this card are to get your first checked bag free on Air Canada flights (perfect for those longer trips where a carry-on on its own won't do) and for receiving discounts when you redeem Aeroplan points for flights on Air Canada. In terms of earning Aeroplan points, you'll earn some of with this card but the Cobalt Card will be your primary Aeroplan points earning card since it earns more points in most spending categories.

Recommended reading: Which credit card earns the most Aeroplan Points?

One of the key reasons you need to have your eye on Aeroplan (or even the other airline and hotel programs that you can convert points with the other two cards in this portfolio) is the potential to earn outsized value from the points you have earned on your credit card spending. The outsized value primarily comes from redeeming for business or first class flights via Aeroplan or the other airline programs or luxury hotel stays via Marriott. And once you have learned more about the points and miles world and are taking it more seriously - it is these premium cabin redemptions or luxury hotel stays that you will be striving for.

However, if you have determined Aeroplan is not right for you in your points & miles journey please see the 'Other Card Options' section below for other options to fill the Visa spot!

Now back to the TD Card, the first checked bag free benefit found on the card is good for the cardholder and up to eight travelling companions on the same reservation for flights operated by Air Canada. With checked baggage fees now running $30 and up per flight this benefit alone can pay for the card each year. The beauty of this benefit is that you don't actually have to pay for your Air Canada flight with the card. As long as it is linked to your Aeroplan number and you have your Aeroplan number on your reservation you'll receive the first checked free benefit.

With many Canadians being Aeroplan members (and if you starting to take the points and miles game seriously, you should be too) having this card is ideal for them thanks to it providing preferred pricing on Aeroplan Award tickets. This preferred pricing discounts the amount of points you need to redeem for an award flight on Air Canada. That discount can range from a few percentage points to over twenty percent depending on the routing and dates of travel.

The TD Aeroplan Visa Infinite Card Quick Facts:

• Annual Fee $139 (waived in the first year with the current welcome bonus offer) $75 supplementary cards
• Up to 50,000 points welcome bonus (Apply by Jan 3, 24)
• Income requirements: $60,000 personal or $100,000 household income
• Apply for this card here.
• Click here to read our in-depth review of the TD® Aeroplan® Visa Infinite* Card

Spending with this portfolio

The card that you pull out of your wallet for a purchase will almost always be the American Express Cobalt Card except for a few select spending categories (and wherever Amex is not accepted). Below are some suggestions as to the best card for each specified category. You will want to take into consideration your overall total expenditures (credit card spending) as you don't want to spread yourself too thin across the three credit cards and not have enough points for meaningful travel redemptions in any one of them. Such is the case with the HSBC card as you need to have 25,000 points to redeem towards travel or to convert to airlines and then you have to redeem in 10,000 point increments after that.

• Grocery, Dining, Drinks and Food delivery purchases: American Express Cobalt Card (unless the merchant doesn't accept Amex - then use either one of the other cards: HSBC if you want more flexibility, TD if you are going to concentrate on Aeroplan)
• Drug Store purchases: HSBC World Elite Mastercard
• Costco Purchases: HSBC World Elite Mastercard
• Gas/Transit/Ride Sharing Purchases : American Express Cobalt Card
• Streaming Services: American Express Cobalt Card
• Travel purchases (if Aeroplan is not your primary rewards program)*: American Express Cobalt Card or the HSBC World Elite Mastercard
• Travel purchases (if you are concentrating on Aeroplan): American Express Cobalt Card
• Travel purchases (if it is an Aeroplan award flight)*: TD Aeroplan Visa Infinite Card
• All other purchases: American Express Cobalt Card (unless the merchant doesn't accept Amex - then use either one of the other cards)
  

* If you are redeeming Aeroplan points for a flight you'll want to use the TD Aeroplan card to cover the fees and taxes so that you receive insurance coverage.

Learn more about the cards here:

Other card options you could consider:

You do have several other card options you could look at in this portfolio.

American Express:

On the American Express side of things you could consider the Scotiabank Gold American Express. It is one of the other three cards considered to be a Points Earning Machine. In fact it has the highest earn rate for groceries of 6 points per dollar if you shop at Sobeys, Safeway, Foodland, FreshCo or other Empire Stores and it has excellent earn rates of up to 5 points per dollar for other spending categories. The big difference between this card and the Cobalt Card is that Scotia does not have airline or hotel conversion options nor does it have a fixed points travel reward chart plus it's cash back (statement credit) value is lower than the Cobalt Card.

Recommended reading: The best credit cards to use at Empire grocery stores

You could also consider any one of the other American Express Membership Rewards cards (Gold, Platinum or Green) as they have the same redemption options however these cards do not match the Cobalt Card's earn rates.

Mastercard:

For the Mastercard slot your next best option is the MBNA Rewards World Elite Mastercard. This is the third and final card to be considered a Points Earning Machine. The card has super strong earn rates - again some of the best in Canada with up to 5.5 points per dollar spent. Where it lacks compared to the HSBC card is that it does charge an FX fee on non-C$ purchases and its travel redemption option, while a great value, is limited to making bookings via MBNA Rewards only. That being said the card will be receiving an option to be able to convert to Alaska Airlines Mileage Plan in the near future so that is a bonus!

If you are looking for a lower fee or lower income requirement Mastercard your best option is the lower tier MBNA Rewards Platinum Plus Mastercard.

Visa:

There are a lot of options for the Visa side of things. While we recommended the Aeroplan Visa Infinite Card, if you don't want to pay the annual fee you could get the no annual fee CIBC Aeroplan Visa Card as that will still provide the discounts on Aeroplan award flights however you will not receive the first checked bag free benefits.

if you decide that you may not fly with Air Canada or utilize the Aeroplan program, a couple of good options to consider would be the Scotiabank Passport Visa Infinite Card or the RBC Avion Visa Infinite Card - both these cards are more flexible in their redemption options than Aeroplan. The Avion card checks a lot of the redemption options including conversion to airlines like British Airways and WestJet. In terms of lower income requirement cards the preferred option for this portfolio would be a card like the Scotiabank Scene+ Visa Card as it has no annual fee and flexible travel rewards.

Wrapping it up

The Ultimate Credit Card Portfolio for those just starting out with points & miles or those looking to take their rewards game more seriously is comprised of three of Canada's best credit cards. The American Express Cobalt Card is one that should be in every Canadian's wallet, the HSBC World Elite Mastercard provides some great travel benefits and no foreign transaction fees and despite the TD Aeroplan Visa Infinite Card being limited to only Aeroplan it is key to stretching the value of Aeroplan points thanks to the discount on award flights. And if Aeroplan doesn't factor into your reward goals, it can still make sense to have the TD card in your wallet simply for the first checked bag free benefit when flying with Air Canada.

This article was first posted on September 12, 2023 and is updated on a regular basis