The best credit cards for millennials, Gen Z and all foodies

There are a couple of ideal credit cards for people who see themselves celebrating the reopening of the economy this summer with many visits to bar and restaurant patios.

Prefer to stay home and indulge yourself with food bought from shops and grocery stores? These same two cards will work well for you, too.

Both American Express Cobalt and Scotiabank Gold American Express let you earn travel reward points at an unusually high rate when you spend at grocery stores and restaurants. If food eats up a lot of your credit-card spending, give them a look to see how they compare with what’s already in your wallet.

The months ahead are an ideal time to reassess the reward credit(s) in your wallet. Card issuers are expected to be competitive with offers to reinvigorate a business that has slowed in the pandemic. The credit reporting firm Equifax Canada says credit-card debt levels have fallen continuously in the pandemic to the lowest level in six years. Equifax also said people have in recent years been moving away from owning multiple cards.

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Early in the pandemic, cashback rewards leaped ahead of travel rewards for practicality. But as we move closer to a return to normal life, the appeal of having points to pay for travel is growing fast.

This brings us back to Amex Cobalt and Scotiabank Gold Amex, both of which excel at turning your spending on food into points you can use to offset the cost of flights and other travel. Gen Z and millennials are target clients for these cards because of their habit of socializing at restaurants and bars. Anyone who spends a lot at restaurants and food shopping should take a look as well.

Both of these cards offer five points per $1 spent at supermarkets, restaurants, bars, cafés and for food delivery, with Cobalt setting a maximum of $30,000 a year in spending for these categories. In addition, Cobalt offers two points per $1 on travel, gas and transit and $1 on everything else, while Scotiabank Gold Amex offers five points on entertainment such as movies, three points on gas, public transit and certain streaming services, and one point on everything else. The Scotiabank card offers an appealing extra benefit in dispensing with the usual 2.5 per cent foreign exchange fees on purchases made outside of Canada.

File these two cards under the category of reward cards that produce points you can redeem for any type of travel, as well as other rewards. Travel is the best bang for your redemption bucks, as usual with reward credit cards. Cobalt’s rewards go furthest when you redeem using the Amex fixed points travel reward program. For example, 40,000 points could be redeemed for a long-haul economy flight in Canada or the United States with a maximum base ticket price of $700.

Many other credit cards offer one to three reward points per dollar spent, so five is quite a step up. But you have to spend a lot on food to fully benefit, something many people have been doing in the pandemic by splurging on groceries and takeout.

I signed up for Amex Cobalt last summer to supplant my Capital One Aspire Travel World Elite Mastercard, a once great card that devalued its 2 per cent reward rate to 1.5 per cent. I’ve checked each monthly bill to compare reward points earned on Cobalt with the same level of spending on the Capital One card at its prime. In all but one month, Cobalt came out ahead.

As ever, the problem with Amex cards is that they’re not accepted by many retailers and service providers. Our property and vehicle insurer bills us monthly and doesn’t do Amex. Neither did stores where we spent some money in the past year on home improvements. A favourite local coffee spot is also an Amex-free zone.

Both Amex Cobalt and Scotiabank Gold Amex have received a thumbs up from several financial product comparison websites. One of these sites, GreedyRates, caught an important detail in their offers: The deal of five points per $1 applies to purchases made in Canada only for Cobalt, and to Canadian dollar purchases for the Scotia card.

Both cards have strong welcome bonus point offers and a $120 annual fee. Cobalt is unique in charging its fee in monthly instalments of $10, which can make them seem pretty much invisible.

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