Before she went to high school, Kinsey got her first bank card, an Alterna Savings Cash Back Visa. Although she also has an account at EQ Bank, her primary bank card was with Alterna Savings and Credit Union. “So it was a natural and easy way for me to get a credit card,” she explains.
Kinsey is latest to bank cards and doesn’t have a credit rating — a number between 300 and 900 that tells lenders how creditworthy you might be (the upper the rating, the higher). She wants to construct a credit rating while earning rewards — be it money back (“to make the most of my spending”) or travel points (she’s an Aeroplan member).
Kinsey is an avid traveler – she recently visited Greece and Japan, where her family lives. “I’ve been down south to Cuba and Florida. I’ve been to Halifax because I have some friends there. I travel within Canada, but I’m definitely more interested in visiting places in Europe,” she says.
What bank card features does she need?
Like many university students, Kinsey is ambitious, likes to travel, and just desires to get her footing financially. Given her existing ties to Alterna, it’s no surprise that she selected an Alterna Savings Cash Back Visa—most Canadians stick with the identical financial institutions for much of their lives. But Kinsey can discover a bank card that higher matches her needs by expanding her horizons.
Your Alterna card is linked to Collabria Rewards, a loyalty program that works with some Canadian credit unions. It earns 1 Collabria rewards point per dollar spent on groceries, gas, public transit, select recurring bills and digital streaming purchases, and 0.5 points on all other purchases. The value of a Collabria point fluctuates depending on what you redeem it for: Cash back offers the perfect value at $0.01 per point, but you will need to redeem in increments of three,000 points (for $30), 5,000 points ($50) and 10,000 points (for $100), depending on which Collabria card you could have. And when redeeming for travel, merchandise or gift cards, a degree could be value between $0.002 and $0.008. That means cardholders will earn a maximum of 1% back in rewards ($0.01) for each dollar spent. Often the refund is less.
For Kinsdey, travel is clearly a priority. She needs a bank card to assist her cut the fee of flights to see family and friends. At the identical time, she’s just learning how one can support herself. Tuition is her biggest expense, and her income this 12 months can be modest at best—she hopes to freelance as a content marketer.
Kinsey’s primary goals right away should due to this fact be to construct a credit rating and increase her income potential by completing her degree. Later in life, she’s going to likely have access to many premium travel bank cards that fit her desired lifestyle – for instance, she’s going to need a private annual income of $60,000 for Visa Infinite cards and $80,000 for World Elite Mastercards.
Which bank card should she get?
Credit card selection #1: CIBC Aeroplan Visa Card for college kids
For her current situation, the CIBC Aeroplan Visa Card for Students would meet many criteria. It is fee-free and doesn’t require income. Kinsey already earns Aeroplan points, and the CIBC Aeroplan Visa would add 1 Aeroplan point to her account per dollar spent on Air Canada purchases (similar to future flights) and food—she has a campus meal plan, but anticipates it is going to not cover all of her food costs. This is along with the points she already earns as an Aeroplan member through the Double Earn Points feature of Aeroplan bank cards.
