this post was submitted on 29 Jun 2023
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Opinions on credit cards with annual fees? (self.personalfinancecanada)
submitted 2 years ago by sweca to c/personalfinancecanada
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I saw this card (https://www.scotiabank.com/ca/en/personal/credit-cards/visa/momentum-infinite-card.html) offered by Scotiabank that offers 10% cash back on purchases within the first 3 mo up to $2k, and 4% regularly on groceries and recurring payments. From first glance, it looks really good, but at the same time, there's a $120 annual fee. Although, the first year has no fee.

I wonder if I could use it for the first year and then close or downgrade it afterward. Would my credit score take a substantial hit?

What's your general opinion on cards with annual fees? What benefits would it need for you to consider one?

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[–] Shadow 6 points 2 years ago* (last edited 2 years ago) (3 children)

My friend, you need to google "churning".

https://princeoftravel.com/newbie-guide/

I have 7 credit cards right now and cycle them regularly. Check /r/churningcanada for their credit card recommendation sticky thread.

To answer your question, no you wouldn't take a hit beyond the initial credit inquiry when you get the card. Just keep an eye on your rating with something like credit karma.

[–] sweca 3 points 2 years ago (2 children)

I've heard of churning but I was told that it can ruin your credit score. How has 7 cards affected your acceptance rate?

[–] Shadow 3 points 2 years ago

It doesn't. You take a tiny hit if someone does a hard inquiry, but it won't do anything major AS LONG AS YOU PAY YOUR SHIT OFF.

If you can pay your balance every month, go for it!