How Stacking Credit Cards Can Maximize Your Cash-Back Returns
Every cash-back credit card has different spending categories where you can earn a higher return. But, holding only one card won’t always get the best bang for your buck. That’s why having two credit cards (one with an annual fee, one without) can help you earn more — which is what I’ve been doing for more than two years.
First, it helps to get a cash-back card with a great return in certain spending categories.
For instance, the Scotia Momentum Visa Infinite Card offers 4% cash back on gas and groceries, 2% cash back on drug store purchases and recurring bill payments, and 1% back on everything else. The CIBC Dividend Visa Infinite Card also offers 4% cash back on gas and groceries, 2% back on Tim Hortons and Telus purchases, and 1% back on everything else. And the TD Cash Back Visa Infinite Card offers 3% cash back on gas, groceries, and recurring bill payments, as well as 1% back on everything else. All three cards require a minimum annual income of $60,000 or a household income of $100,000.
The SimplyCash Preferred Card from American Express and the MBNA Rewards World Elite Mastercard also have an annual fee, but they offer 2% cash back on all purchases. The Amex card no longer lists a minimum annual income requirement (it previously was only $15,000). However, you need to have an annual income of at least $80,000 or a household income of $150,000 for the MBNA card.
I prefer the Scotia Momentum card because of the 4% cash back on groceries as well as the 2% cash back on drug store purchases and recurring bill payments. While the Amex card is promising, it’s still not accepted everywhere and I hate to admit it, but I don’t qualify for the MBNA card.
Featured
Scotia Momentum® VISA Card
Get a 2.99% introductory interest rate on purchases and balance transfers for the first 6 months (19.99% on purchases/22.99% on cash advances including balance transfers after that; annual fee $39). Offer ends October 31, 2025.
Card details
- No annual fee in the first year, including on supplementary cards. Offer ends January 1, 2022.
- Welcome Offer: Get 10% cash back on all purchases for the first 3 months (up to $200)
- Once welcome offer ends, earn 4% cash back on gas and groceries, 2% cash back on drug store purchases and recurring bill payments, and 1% cash back on all other purchases
- Receive VISA Infinite benefits
Second, you need to get a cash-back card without an annual fee. The amount of cash you can earn varies.
For example, the Tangerine Money-Back Credit Card offers 2% cash back on up to three categories and 0.5% back on everything else. The National Bank ECHO Mastercard offers 1.5% cash back on gas, groceries, and online purchases as well as 1% back on everything else.
There’s also the MBNA Rewards Mastercard and the BMO CashBack Mastercard. Each card offers 1% cash back on everything while the SimplyCash Card from American Express offers 1.25% cash back.
I like the Tangerine card because it allows me to earn 2% back in certain categories (such as restaurants and entertainment) other no-fee cards don’t offer. By having the cash deposited into a Tangerine savings account, I also get to choose an additional category.
Featured
Tangerine Money-Back Credit Card
Earn an extra 10% back on up to $1,000 in everyday purchases within the first 2 months. Must apply by January 31, 2025.
Card details
- No annual fee
- Earn 2% cash back on purchases in up to three categories of your choice (grocery, restaurants, gas, drug store, entertainment, furniture, hotel-motel, recurring bill payments, home improvement, public transportation and parking)
- Earn 0.5% cash back on everything else
- No limit on how much cash back you can earn
Let’s see how these cards with an annual fee stack up with certain types of spending. While some cards offer an annual fee rebate for the first year or a higher cash-back rate for a certain period of time, I’m going to compare the cards in their second year because any rebates or promotional cash-back rates won’t make as much of a difference over the long term.
We’ll assume monthly spending of $1,450 in these categories:
Here’s how much you’ll earn over the course of a year:
As you can see, the Scotia Momentum Visa Infinite card wins hands down because certain categories offer higher cash-back rates. But even though the TD card offers higher cash-back rates in certain categories, it trails the MBNA card partly due to its higher annual fee.
The amount of cash you’ll earn with the no-fee cards will obviously be less since they offer lower cash-back rates. In certain spending categories, it will make more sense to use a no-fee card because you’ll be able to earn more cash back. If you have the Tangerine card and choose restaurants, travel (hotel/motel), and entertainment as your 2% cash-back categories, you can earn much more compared to other no-fee cash-back cards:
| Category/Card | Tangerine Money-Back | SimplyCash from Amex | BMO CashBack Mastercard | MBNA Rewards Mastercard | National Bank ECHO Mastercard |
| Restaurants | $24 | $15 | $12 | $12 | $12 |
| Travel | $24 | $15 | $12 | $12 | $12 |
| Entertainment | $24 | $15 | $12 | $12 | $12 |
| Net earnings | $72 | $45 | $36 | $36 | $36 |
I’ve been using both the Scotia and Tangerine cards in for a little more than two years. I use the Scotia card at grocery and drug stores, as well as for recurring bills. And I use the Tangerine card for restaurants, entertainment, and groceries (unfortunately, No Frills doesn’t accept Visa). As a result, I managed to net more than $425 in cash-back earnings last year.
The bottom line
The best cash-back credit cards provide you with the opportunity to earn money on your everyday spending. By having two cards and using a different one for certain spending categories, you can maximize your cash-back earnings.
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