The $120 Investment That Changed My Financial Life: My First Credit Card Strategy

“You want to pay $120 for a credit card when you can get one for free?”

My colleague looked at me like I’d lost my mind. I was three weeks into my Canadian journey, and everyone was giving me the same advice: start with a no-fee credit card, build credit slowly, be conservative.

I chose differently. That $120 “splurge” on a premium credit card became the cornerstone of my financial success in Canada. Here’s the full story, the math behind my decision, and why conventional wisdom isn’t always wise.

The Context: My First Month in Canada

The Traditional Path Everyone Recommended

Week 1 in Toronto, I joined several newcomer groups and asked about credit cards. The unanimous advice:

• Get a free secured card
• Or get a basic no-fee card
• Build credit slowly
• After 2-3 years, consider premium cards

It sounded sensible. It was also completely wrong for my situation.

The Research That Changed Everything

Instead of following the crowd, I spent a weekend researching. I created a spreadsheet comparing every credit card available to newcomers:

• Annual fees
• Welcome bonuses
• Earning rates
• Benefits
• Insurance coverage
• Long-term value

That’s when I discovered the RBC Avion Visa Infinite for newcomers.

The $120 Card That Started It All

Why RBC Avion Visa Infinite?

The Costs:

• Annual fee: $120
• No fee waiver for newcomers
• Required newcomer banking package

The Benefits That Caught My Eye:

• 35,000 welcome points (worth $350-700)
• Comprehensive travel insurance
• Mobile device insurance
• Purchase protection
• Lounge access passes
• Higher earning rates

The Math That Convinced Me

I ran the numbers comparing it to free alternatives:

Free Card Scenario:

• $0 annual fee
• Basic 0.5% cash back
• No welcome bonus
• No insurance benefits
• Annual value: ~$50 cash back on $10,000 spending

$120 Avion Card Scenario:

• -$120 annual fee
• +$350 minimum welcome bonus value
• +$200 travel insurance value (one trip)
• +$150 mobile device insurance value
• +$100 purchase protection value
• Net first-year value: +$680

The premium card would put me $630 ahead in year one alone.

The Application Day

The Skeptical Banker

“Are you sure you want this card? We have free options for newcomers.”

The RBC advisor seemed genuinely concerned I was making a mistake. She explained three times that the annual fee wouldn’t be waived. I pulled out my spreadsheet.

After seeing my analysis, she smiled. “You’ve done more research than most people who’ve been here for years.”

The Moment of Truth

Application submitted. The wait felt eternal. Then:

“Congratulations, you’re approved with a $5,000 limit.”

As a newcomer with zero Canadian credit history, I had just been approved for a premium credit card with a substantial limit. The advisor was shocked. I wasn’t—I had positioned myself perfectly.

How I Maximized the Investment

Month 1-3: Welcome Bonus Strategy

The bonus required $1,500 spending in 3 months. Here’s how I hit it:

• Groceries and daily expenses: $400/month
• Furnished apartment purchases: $500
• Winter clothing: $300
• Cell phone purchase: $400

Total: $2,000 in natural spending Bonus earned: 35,000 Avion points

The Hidden Multiplier Effect

What I didn’t expect was how the premium card would accelerate everything else:

Credit Building:

• Higher limit meant lower utilization
• Premium card on credit report impressed other lenders
• Payment history on significant card weighted heavily

Other Applications: Within 6 months, having the Avion card helped me get approved for:

• A second premium card (TD Aeroplan Visa Infinite)
• A car loan at prime rate
• An unsecured line of credit
• Premium apartment rental (landlord was impressed)

The Insurance Benefits That Paid for Themselves

Mobile Device Insurance Save

Month 4: I dropped my phone. Screen shattered. Replacement cost: $300.

The Avion card covered it with just a $25 deductible. Savings: $275.

The annual fee had already paid for itself twice over.

Travel Insurance Victory

Month 8: Trip to Vancouver. My flight was cancelled due to weather, stranding me overnight.

Coverage included:

• Hotel night: $180
• Meals: $60
• Taxi transfers: $40 Total reimbursement: $280

No receipts questioned, claim processed in 10 days.

Purchase Protection Win

Bought a laptop that went on sale two weeks later. Price protection refunded the $150 difference automatically.

The Compound Effect

Year 1 Final Tally

Costs:

• Annual fee: $120

Direct Benefits:

• Welcome bonus value: $650 (redeemed for travel)
• Insurance claims: $555
• Price protection: $150
• Lounge passes used: $60
• Points from spending: $180

Total Year 1 Value: $1,595 Net Benefit: $1,475

Indirect Benefits (Invaluable)

• Credit score reached 760 in 12 months
• Approved for mortgage pre-approval
• Qualified for premium cards from other banks
• Established as “premium” customer at RBC

Why Most Newcomers Get This Wrong

The Poverty Mindset Trap

Many newcomers think: “I’m new, I should start small.” “I don’t deserve premium products yet.” “I should save every penny.”

This mindset keeps you in the slow lane.

The False Economy

Saving $120 on annual fees while missing out on:

• Thousands in welcome bonuses
• Hundreds in insurance benefits
• Faster credit building
• Premium customer treatment

Is like saving pennies while dollars fly by.

The Information Asymmetry

Banks don’t advertise that newcomers can qualify for premium cards. Why would they? They’d rather you start with basic products and upgrade slowly, paying fees for years.

The Strategy for Others

When Premium Cards Make Sense for Newcomers

You should consider a paid card if:

• You have steady income (or will soon)
• You can meet welcome bonus spending naturally
• You travel at least once per year
• You value insurance protections
• You’re building credit aggressively
• You can pay in full monthly

Stick with free cards if:

• Income is uncertain
• You can’t meet bonus requirements
• You won’t use the benefits
• You carry balances
• You’re risk-averse

My Recommended Premium Newcomer Cards

For Travel Focus:

1. RBC Avion Visa Infinite ($120)
2. TD Aeroplan Visa Infinite ($139)
3. AMEX Gold ($250 - high fee but huge benefits)

For Cash Back:

1. Scotia Momentum Visa Infinite ($120)
2. CIBC Dividend Visa Infinite ($120)
3. BMO World Elite ($120 with fee waiver options)

For Simplicity:

1. AMEX SimplyCash Preferred ($99)
2. TD Cash Back Visa Infinite ($120)

The Application Strategy

1. Choose your bank wisely: Open account where you want the premium card
2. Mention your research: Show you understand the product
3. Emphasize stability: Employment letter, rental agreement
4. Apply in person: Higher approval rates
5. Have backup plan: Know which free card you’d accept

Lessons Learned

Lesson 1: Invest in Your Financial Future

That $120 wasn’t a fee—it was an investment that returned over 1,000% in year one alone.

Lesson 2: Question Conventional Wisdom

“Start small” advice keeps you small. Sometimes the bold move is the right move.

Lesson 3: Value Your Worth

Being new doesn’t mean accepting less. I deserved premium products, and so do you.

Lesson 4: Do the Math

Emotional decisions lead to “saving” $120 while losing $1,000+ in value. Run the numbers.

Lesson 5: Benefits Compound

A premium card doesn’t just give direct benefits—it positions you as a premium customer everywhere.

The Ripple Effects Three Years Later

Current Status

• 820+ credit score
• 14 active credit cards
• $100,000+ in available credit
• Mortgage at prime rate
• Premium banking relationships

The Foundation

It all started with that “risky” $120 investment. That card:

• Established me as a serious customer
• Built credit history faster
• Provided confidence to apply for more
• Saved money through benefits
• Generated thousands in rewards

What If I’d Played It Safe?

If I’d started with a free card:

• Slower credit building
• Missed welcome bonuses
• No insurance protections
• Treated as basic customer
• Years behind current position

Your Action Plan

Step 1: Evaluate Your Situation

• Monthly spending capacity?
• Income stability?
• Benefit utilization likelihood?
• Risk tolerance?

Step 2: Research Premium Options

• Compare welcome bonuses
• Calculate insurance values
• Assess earning structures
• Read the fine print

Step 3: Make the Investment (If It Makes Sense)

• Choose one premium card
• Apply strategically
• Meet bonus requirements
• Use benefits fully

Step 4: Track Your Return

• Document benefit usage
• Calculate total value
• Adjust strategy accordingly

The Bottom Line

Not every newcomer should pay for a premium credit card. But dismissing them automatically because of annual fees is shortsighted. For me, that $120 investment became the catalyst for financial success in Canada.

The question isn’t whether you can afford the annual fee. It’s whether you can afford to miss the opportunity.

Sometimes the best financial advice isn’t to save money—it’s to invest it wisely. My $120 “splurge” taught me that in Canada, starting premium can fast-track your entire financial journey.

Don’t let fear of fees keep you from life-changing benefits. Do the math, trust the numbers, and if they make sense—make the investment. Your future self will thank you.

Remember: In personal finance, the expensive option is sometimes the cheapest, and the free option is sometimes the most costly. Choose wisely.