I analyze credit card periodically to find which ones have the best features. So many of them have reward points, cash back, and other money saving features. Sometimes it is hard to see what is better, so I do a bit of analysis. If you think I’m off base, post a comment.
Today we will look at the TD Rebate Rewards Visa Card. This is a Visa that will put a credit on your account based on a percentage of how much money you spend during the year. The credit happens in January.
What Rebate Cards Are There with TD Bank?
There are two main cards. The TD Rebate Rewards Visa Card and the TD Elite Gold Visa Card.
The TD Rebate Rewards is nice as it has no annual fee. Right off the start you are not out any money for having this card (unless you have a balance as its rate is over 19%). The earning rate is 0.5% on the first $3,000 you spend annually and then 1% on the amount above that up to a maximum of $25,000. Basically, this means the most you can ever get back from this card is $235/year.
The TD Elite Gold is 1% for all your purchases annually and there is no limit. It also includes other features like travel insurance coverage so you don’t have to pay for it yourself. You do have to pay an annual fee of $99 however.
Which Card Is Better?
I have a couple points here. First of all, the ScotiaBank No Fee Money Back Visa Card gives you 1% back on net purchases which has no maximum and has no yearly fee. This is far better than the TD Rebate Rewards Visa Card as it has a lower return rate and a maximum limit on it.
If you really want to stick with the TD Bank’s cards though, I did an analysis on when upgrading would cover the annual fee and earn you more money back. The magic point is at $33,400/year. When you put this much through your Visa each year, it will start to earn more money on the Elite Gold than on the Rebate Rewards card. The other argument is that if you take at least one trip a year where you would purchase baggage or other travel insurance, then the $99 fee would easily be covered.
Summary of the TD Visa Cards
Don’t bother with the TD Rebate Rewards Visa as the ScotiaBank Money Back Visa gives you a lot more for the same “no annual fee”. In fact, the ScotiaBank card earns the same as the Elite Gold, but without he fee. There is no point in upgrading to the TD Elite Gold Visa unless you are going to save more than the $99 annual fee you pay in travel insurance costs throughout the year. Think of it as a $99 flat rate for travel insurance for the year.
If you really want to stick with the TD brand of money back visas, then the upgrade point should be if you spend more than $33,400/year on your Visa or take enough annual trips where your insurance costs savings are over $99 for the year.