Premium credit cards are enticing – whether it’s the increased rewards, improved perks, or insurance that attracts you, there is a lot to like about them. (Not to mention the rather large welcome bonus offers.)
But, there’s also that annual fee. How do you know whether or not it will be worth it?
Enter in first year free credit cards. Many premium credit cards waive the annual fee for the first year. This way, you can try it out for a year, and see if it really does work for you.
Here are some of the best first year free credit card deals available.
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The best first year free credit card offers
| Card name | Great for… | Annual fee | Apply now |
|---|---|---|---|
| BMO AIR MILES World Elite Mastercard | Earning AIR MILES and shopping at Costco | $120 | Apply |
| BMO eclipse Visa Infinite | Getting unique perks and earning flexible rewards | $120 | Apply |
| BMO Cashback World Elite Mastercard | Getting straightforward cash back rewards on all purchases | $120 | Apply |
| Scotiabank Momentum Visa Infinite | Big grocery and bill spenders – the highest cash return for these categories | $120 | Apply |
| Scotiabank Gold American Express | Earning plenty of flexible rewards, and paying no foreign exchange fees | $120 | Apply |
| Scotiabank Passport Visa Infinite | Travellers who want a premium Visa with perks and no foreign exchange fees | $150 | Apply |
| BMO World Elite Mastercard | Travellers who want 4 free lounge passes and flexible reward lovers | $150 | Apply |
| BMO Preferred Rate Mastercard | Permanent low interest rates and balance transfer savings | $29 | Apply |
Let’s take a closer look at a few of these cards.
Best for earning Air Miles
×1 Award winner 
GC: $150
1x Award winner
$150 GeniusCash + Up to 9,000 bonus AIR MILES + 3x the AIR MILES at partners.*
With a regular annual fee of $120 the
If you’re an Air Miles fan, this may be a solid choice for you, as it earns:
- 1 Mile for every $12 spent
- 3x the Miles for every $12 at participating Air Miles partners
- 2x the Miles for every $12 spent at any eligible grocery, liquor, and wholesale stores
You’ll also earn 9,000 miles after spending $20,000 in the first year, and an additional $1,000 at wholesale clubs and grocery stores, get a 25% discount on 1 Air Miles reward flight per year, and get free access to over 1 million Wi-Fi hotspots worldwide.
Other perks include:
- VIP access to airport lounges through Mastercard Travel Pass,
- 14 types of complimentary travel insurance and purchase protection, and
- 24/7 concierge service.
The only major challenge is that the eligibility requirements are pretty steep. In addition to having a healthy credit score, you’ll also need a personal income of at least $80,000, or a household income of $150,000 or more.
If you’re keen on collecting those Air Miles, this is essentially a free credit card for the first year you have it, so why not take it for a spin?
Best for flexible rewards and getting unique perks
GC: $150
To earn flexible rewards and get some unique perks, there’s the
First, here’s what you’ll earn for rewards:
- 5 BMO Rewards points for every $1 spent on dining, groceries, gas, and transit
- 1 point per $1 spent on all other purchases
But more than that are the perks – including 2 unique perks not found elsewhere.
First, you’ll earn 10% bonus points when you add an authorized user.
Second, every year you have the card, you’ll get a $50 lifestyle credit, which automatically gets applied to your first purchase that’s more than $50.
Plus, it includes rare mobile device insurance which covers your cell phone (that you take almost everywhere).
And you can try this out for free for year one.
Best cash back for a variety of everyday purchases
GC: $150
To cast a wide net when it comes to earning bonus cash back, the
Here’s what you’ll get on your purchases:
- 5% cash back on groceries, up to $500 in monthly spend
- 4% cash back on transit, up to $300 in monthly spend
- 3% cash back on gas, up to $300 in monthly spend
- 2% cash back on recurring bills, up to $500 in monthly spend
- 1% cash back on all other purchases
That’s a lot of high-value earn rates. Just note the monthly caps on them.
The best part is you can get your cash back on demand as soon as you’ve earned as little as $1 in rewards. Some other cash back credit cards make you wait a full year to get your rewards, so this is a more accessible treat.
To top it off, it includes free roadside assistance, one of the rarest perks found on credit cards, and 13 types of insurance coverage.
And of course, the $120 annual fee is waived for the first year.
Best for groceries and recurring bills
GC: $20
The final credit card we’re going to look at in detail here is the
If you’re looking to save money on groceries and recurring bills (2 common and expensive budget items for most Canadians), you’ll earn some nice bonus cash back on those purchases with this premium Scotiabank Visa.
Here’s what you’ll earn with this card:
- 4% cash back on groceries and recurring bill payments
- 2% cash back on gas and transit
- 1% cash back on all other purchases
This premium credit card also comes with 11 types of included insurance coverage, giving you added peace of mind.
While the annual fee for this Scotiabank Visa is normally $120, it’s also a first year free credit card, so you can easily try before you buy.
Pay no fee for the first year
Some offers might seem too good to be true, but first year free offers often benefit both the cardholder and the card issuer.
Taking advantage of these offers is your chance to take a premium credit card for a test drive and answer the following questions before making an annual fee commitment:
- Will my spending justify the fee?
- Does the card suit my needs and my spending?
- Will I get any use of the perks offered by the card?
- Does the bank have a user-friendly website and mobile app?
- Is the credit card’s customer service helpful?
With a free year of card ownership, you’ll hopefully be able to answer all of these questions and get a good idea if you want to take on the annual fee.
This free period is also good for the issuer – it’s a way for them to reach customers who wouldn’t normally apply for a card with an annual fee.
And at the end of the year, they either hope you’re impressed enough with the card that you’ll want to stick around, or that you won’t be bothered enough to cancel your card.
My first year is over, now what?
A year without an annual fee is great, but what should you do when your free year is up?
First, you’ll need to decide if you want to keep the card or not.
If you answered the above questions and feel pretty good about the card, you might see that the annual fee is worth it – you’re probably getting more rewards in the long run anyway.
Or maybe you’re not super happy with the card and think you’d be better off with a lower annual fee.
Here are some tips on how to navigate moving forward.
Negotiate your annual fee
If you want to hang on to the card, you could try using the power of persuasion.
Simply call customer service and see if there’s a way you could negotiate your annual fee.
Be honest – let them know you like the card but you’re not sure you can justify the high annual fee.
Remind them that you always pay your bill on time and would be happy to stay with them as a loyal customer.
Be friendly and sincere…the worst that could happen is they say no.
Downgrade to the no fee version
If you’re happy with the rewards you’ve earned and want to keep letting them pile up, you could simply switch to the no fee or lower fee version.
This way you can keep the rewards you earned in your first year and, although you won’t earn as many rewards with your lower fee card, you’ll continue to earn on every purchase you make.
Here are some popular premium credit cards and their no fee counterparts:
Shop around for a card that suits you better
Or maybe you want to get a new credit card – a card that’s the perfect fit for you.
Not sure how to find the perfect card?
We’ve developed a credit card quiz that:
- takes less than 3 minutes,
- takes your personal preferences and spending into account,
- makes recommendations based on your choices, and
- lets you earn up to $25 when you refer your friends.
Would you like to know which credit cards are right for you?
Take our creditcardGenius Quiz to find out.
When it makes sense to pay an annual fee
You know that old saying “You gotta spend money to make money”?
When it comes to credit cards, sometimes that really is the case.
No one likes paying fees, but there are times when having a card with an annual fee will give you more rewards than the no fee version – even after factoring in the fee.
Even if you’re not a huge spender, if you put the majority of your purchases on your credit card, having a card with an annual fee could still make sense.
As an example, we took a few premium credit cards and put them against their no fee counterparts to find out the tipping point – ie. the point when upgrading to the premium version would make sense.
For most of these cards, the tipping point is surprisingly low.
| No fee version | The tipping point | Premium version |
|---|---|---|
| $1,100 a month | ||
| $820 a month | ||
| $640 a month | ||
| $900 a month | ||
| $400 a month |
Please note: These numbers were calculated based on a typical spend breakdown without maximizing any spending categories.
Depending on your spend, these numbers could be even lower.
Take the
But, wait – there’s more! If you’re only using your Scotia cash back card on recurring bills or grocery purchases, the tipping point number goes down to only $333 a month. At that point, you might as well upgrade to the
Grab one of these offers before it’s gone
One thing you should know about first year free credit card deals is that they don’t last forever.
If you see an offer that interests you, you might want to apply before it’s too late.
Have you ever taken advantage of a first year free credit card offer?
Did you stick with the card when your free year was up?
Let us know in the comments below.
FAQ
Which issuers offer first year free credit card deals?
Not all issuers offer first year free credit cards. Some of the bigger issuers that do include BMO, Scotiabank, and Brim.
How can I get a free credit card?
If you want a credit card that will never charge an annual fee, we have a list of Canada’s best no fee credit cards that you can take a look at. If you’re looking for a credit card with an annual fee that is waived for the first year (which many premium credit cards do), we have a short list of some of our best right here.
What are the best free credit card deals currently available?
Our best credit cards with no annual fee have their very own dedicated page, where we even tell you which one was named the best no fee credit card this year. If you’re interested in a first year free credit card, you can find a short list of some of the best free credit cards above.
What’s the best free credit card with cash back rewards?
Right now our top cash back credit card with a free year is the Scotia Momentum Visa Infinite Card. Our top no annual fee cash back credit card is the Brim Mastercard.
Is there really such a thing as a free credit card?
While it would be nice to pretend, there really isn’t such a thing as a completely free credit card. It’s true that many credit cards don’t charge an annual fee, and some don’t charge foreign transaction fees, and others have nice low interest rates. But, in the end, chances are you’ll end up paying something for your credit card, whether it’s an annual fee, a monthly fee, or just the occasional interest payment.
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