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With the negative stigma surrounding credit cards, it’s no wonder most people shy away from using them to their full potential. What some of us may not realize is just how valuable credit cards can be as personal finance tools when used correctly.

Here are 20 ways to level up your credit card game and become a credit card genius.

1. Use credit cards responsibly

The most important thing to keep in mind before you can level up your credit card game is responsible credit card use. The key is to NEVER treat your credit card as if it were extra income.

No amount of rewards can compensate for the crazy interest fee you’d pay if you keep a balance on your card. Always make sure to pay your balance in full before your, typically 21 day, interest-free grace period expires.

2. Build and improve your credit score

With responsible credit card use, your credit score should increase over time. A better credit score often means better interest rates – whether you’re applying for a car loan, a mortgage, or even an apartment, you’ll see the benefits of having a good credit score.

3. Widen your search: all credit cards are on the table

One common credit card myth is thinking that you’re only limited to your regular bank’s suite of credit cards, which isn’t the case.

You’re allowed to apply for any Canadian credit card you want, allowing you to truly make the most out of your spending.

Linking up your new credit card with your online banking to make payments is as easy as setting up a new bill payee – if you’re not sure how your online banking works, it’s definitely worth looking into, and not just for the benefits of going paperless.

4. Apply online for instant approval

Most of the time, you don’t have to apply for a credit card at a physical branch. As with most things nowadays, you can do it online.

Some issuers will even let you know whether you got approved or not within moments of submitting your application.

5. Earn top-tier rewards

Perhaps the most obvious and beneficial perk of having a credit card in your wallet is the ability to earn top-tier rewards.

Sure, there are some that don’t offer any rewards, like secured cards, low interest cards, super basic cards, and some student cards.

My first credit card, which I carried for roughly 5 or 6 years, offered no rewards whatsoever. Had I known what else what out there, I could have switched to a more lucrative card and earned rewards along the way. Who knows, I could have had enough rewards banked to pay for a free trip by now…

6. Know the different types of rewards available to you

There are 3 basic groups of credit card rewards:

• cash back,
• travel, and
• flexible.

Cash back offers the more straightforward approach – you get small percentages back, sometimes tiered, on all your purchases.

Flexible rewards and travel rewards, however, are a bit more complicated.

The difference between flexible and travel rewards is the potential value you can get from the 2 – flexible rewards credit cards offer more options, more availability, and fewer restrictions.

Travel rewards credit cards have the potential for much higher point values, but there’s usually some legwork involved and planning ahead that needs to be done.

7. Leverage credit cards for discounts

Aside from earning rewards, some credit cards will even offer you exclusive discounts. For example, some credit cards offer 3 cents per litre discounts at participating Petro Canada locations. And another lets you earn 1 Air Mile for every $10 spent.

Now that you know credit cards can be used to your advantage, you can start learning about some of the finer details that might get overlooked.

8. Save on foreign exchange fees

Credit cards are great for online shopping. And though PayPal is a reliable tool, why not earn some of those rewards we were talking about?

One thing to keep in mind, however – when shopping in a foreign currency (USD, Euro, AUD, etc.) most credit cards charge a foreign exchange fee. This fee, usually anywhere between 2% to 3% or your total purchase, gets charged to your account in order to convert your Canadian funds into the other currency.

2.5% may not sound like a lot, but it definitely adds up.

9. Be on the lookout for offers and deals

In the credit card world, it definitely pays to know you’ve got options and what those options are.

Shop around, and make sure you find what’s best for you. If there’s a better deal than what you currently have, don’t be afraid to change your card and get something that works better.

With about 200 credit cards in Canada, new offers and deals are always available to card applicants.

10. Shop for the best balance transfer offer

Hitting a rough patch happens. It’s normal – but if you find yourself struggling to pay off your credit card balance and interest just keeps stacking up, there are balance transfer credit cards which allow you to take advantage of lower interest rates for a limited period of time, saving you money along the way.

Something to note, however – once that promotional period is over, the interest rates usually go right back up. So it’s important to make sure you’re able to pay off your balance before then.

11. Find out if a permanent low interest card makes sense for you

In the same idea, low interest credit cards can help you save on interest if you’re planning a big purchase, for example.

The difference between balance transfers and permanently low interest rates is the time span – balance transfer promos are usually temporary with expiry dates. Permanently low interest rates don’t have an end date.

12. Benefit from secured credit cards

If you have bad credit, the best thing to do to get your credit score up again is through a secured credit card.

Although you have to give a deposit (which will equal your credit limit), by consistent, responsible use, you can rebuild and improve your credit score over time. Once your credit score is back up, you can apply for a better card.

13. Stack multiple cards to max rewards

Once you’ve mastered just one credit card, you can start “stacking” – using multiple credit cards to max your rewards.

Whether by combining several credit cards geared towards the same goal, or multiple different credit cards working towards separate goals, stacking is the best way to make the most out of your spending. At this point, your debit card probably rarely, if ever, gets used.

14. Decide if an annual fee card is worth its keep

When are annual fees worth it? It’s all based on what you’re getting in return.

And if you’re stacking multiple cards, it’s important to keep track of your spending on each one to make sure your return pays off the annual fee, and then some.

Here’s a quick formula to see if your card is worth the annual fee.

(Annual fee / Average return on spending %) / 12 months = Your break-even spending

For example, for a credit card with a $120 annual fee and a 2% average return on spending, you would have to spend $500 per month on that card in order to break even.

($120 / 2%) / 12 months = $500

15. Boost your rewards with welcome bonuses

Welcome bonuses can be extremely valuable. Especially with travel credit cards, they can boost your rewards bank considerably in a short amount of time.

Staying on top of current and relevant welcome bonuses is a good way to make the most of your credit cards.

16. Max your rewards redemption with point value analysis

Not all points are created equal. Some are worth a lot more than others, whereas some are a lot harder to earn than others.

For example, if a credit card comes with a 1,500 point welcome bonus which you decided to redeem for one short-haul flight worth $350 (excludes taxes and fees), then one point is worth $0.233 for flight redemption.

Keep in mind that different redemption options will give you a different point value.

17. Understand how return on spending is calculated

Most credit cards have tired rewards, meaning you’ll get different earn rates depending on the category of what you purchased falls into.

The average return on spending is calculated by getting the average of all earn rates offered.

When it comes to travel rewards or flexible rewards, the value of your points should also be included in the equation to get your overall return rate.

18. Take advantage of included insurance coverage

Most credit cards come with at least some kind of insurance coverage.

There’s purchase insurance, which includes:

• extended warranty,
• purchase protection,
• mobile device insurance, and
• price protection.

You can also get travel insurance, such as:

• travel accident,
• emergency medical,
• trip cancellation,
• trip interruption,
• flight delay,
• baggage delay,
• lost or stolen baggage,
• personal effects insurance,
• hotel burglary,
• rental car theft & damage,
• rental car accident, and
• rental car personal effects.

Knowing what your card has for insurance coverage, and using it, is key to levelling up your credit card game.

19. Maximize your value with exclusive perks

Perks are like the extra frosting on a cupcake – they make an already good thing even better.

Not all cards come with perks, unfortunately, but the ones that do don’t disappoint.

You can get access to things like:

• concierge service,
• companion flight vouchers,
• lounge membership and free passes,
• upgraded loyalty program status,
• priority check-in,
• priority boarding,
• discounts on car rentals, and
• much more.

20. Rate Your Wallet tool

For the real credit card Geniuses, there’s Rate Your Wallet.

This fun and quick 3-minute quiz will tell you just how well your credit cards stack up based on your personal preferences and spending habits. If your cards don’t make the cut, you’ll get personalized recommendations on which ones will.

creditcardGenius is a purely math-based credit card comparison engine, comparing over 50 features of over 190 Canadian credit cards, so you can maximize your rewards. Rate Your Wallet is their 3-minute quiz that tells you if your card is worth the keep.