Tangerine cash back MasterCard | Page 3 | Credit card reward programs | Discussion forum

Thanks for thinking this through, djino.

I want to know how this works out so I have arbitrarily chosen, as an example, the figures you have given us for Oct. 5, to see how this might work for a purchase. I didn't follow how you came up with the percentage differences in the rates, so I have done it in a way that makes sense to me.

Assume a purchase of $100.US and rounding off to dollars and cents.

(1) Amazon Visa at 1% rebate rate
$100.US = $132.72 Cdn.
1% rebate on $132.72 = $1.33Cdn
Forex fee = 0.
Net return = rebate - forex = $1.33Cdn - 0 = $1.33Cdn.

(2) Tangerine MC at 2% rebate rate
$100.US = $131.33 Cdn.
2% rebate on $131.33 = $2.63 Cdn.
Forex fee = 1.5% x 131.33 = $1.97
Net return = rebate - forex = $2.63 - $1.97 = $0.66Cdn.

Therefore, in this example, one would do better with the Amazon Visa card.

Amazon Visa advantage:
Amazon Visa net return - Tang MC net return =
$1.33 - $0.66 = $0.67 Cdn per $100 US (+/- $132 Cdn) spent.
$0.67 / $132 x 100 = approx. 0.5%

If I have miscalculated, please let me know.

The question remains as to what the Amex exchange rate is, as they give 1.25% rebate on everything on their "Simply Cash" no-fee card but I think they do charge 2.5% Forex? Can anyone confirm?

Loonie said

Thanks for thinking this through, djino.

I want to know how this works out so I have arbitrarily chosen, as an example, the figures you have given us for Oct. 5, to see how this might work for a purchase. I didn't follow how you came up with the percentage differences in the rates, so I have done it in a way that makes sense to me.

Assume a purchase of $100.US and rounding off to dollars and cents.

(1) Amazon Visa at 1% rebate rate
$100.US = $132.72 Cdn.
1% rebate on $132.72 = $1.33Cdn
Forex fee = 0.
Net return = rebate - forex = $1.33Cdn - 0 = $1.33Cdn.

(2) Tangerine MC at 2% rebate rate
$100.US = $131.33 Cdn.
2% rebate on $131.33 = $2.63 Cdn.
Forex fee = 1.5% x 131.33 = $1.97
Net return = rebate - forex = $2.63 - $1.97 = $0.66Cdn.

Therefore, in this example, one would do better with the Amazon Visa card.

Amazon Visa advantage:
Amazon Visa net return - Tang MC net return =
$1.33 - $0.66 = $0.67 Cdn per $100 US (+/- $132 Cdn) spent.
$0.67 / $132 x 100 = approx. 0.5%

If I have miscalculated, please let me know.

The question remains as to what the Amex exchange rate is, as they give 1.25% rebate on everything on their "Simply Cash" no-fee card but I think they do charge 2.5% Forex? Can anyone confirm?

Yes you have miscalculated. When Tangerine calculates the 2% Bonus, it would be on the Canadian Value (After the Forex Fee is applied). I'll use your $100 USD example and calculate the final total (including the Cashback).

Amazon Chase purchase $100USD October 5th:
- $100USD * 1.327267 = $132.73 CAD
- Amazon Provides 1% Cashback. $132.73 * 0.01 = $1.33
- $132.73 - $1.33 = $131.40

So $100 USD purchased on the Amazon card would result in $131.40 after conversion minus cashback.

---

Tangerine Bonus Category purchase of $100USD October 5th:
- $100USD * 1.3133 = $131.33 CAD
- $131.33CAD * 1.015(Forex Fee) = $133.30 CAD
- Tangerine Provides 2% Cashback. $133.30 * 0.02 = $2.67
- $133.30 - $2.67 = $130.63 CAD

So $100 USD purchased on the Tangerine card on a Bonus category item would result in $130.63 after conversion minus cashback.

---

Result:
- $100USD = $131.40CAD With Amazon
- $100USD = $130.63CAD with Tangerine (If on Bonus Purchase)

djino said

Tangerine Bonus Category purchase of $100USD October 5th:
- $100USD * 1.3133 = $131.33 CAD
- $131.33CAD * 1.015(Forex Fee) = $133.30 CAD
- Tangerine Provides 2% Cashback. $133.30 * 0.02 = $2.67
- $133.30 - $2.67 = $130.63 CAD

So $100 USD purchased on the Tangerine card on a Bonus category item would result in $130.63 after conversion minus cashback.

---

Result:
- $100USD = $131.40CAD With Amazon
- $100USD = $130.63CAD with Tangerine (If on Bonus Purchase)

Djino, I agree you need to include the apparent foreign exchange difference to calculate the total cost. However, I didn't think cash back was usually given for such things as interest charges or fees like the 1.5% exchange commission (although it only results in a small difference to your results). I couldn't find that information on the Tangerine site. Does Tangerine give you 2% back on the commission?

Thanks for the correction. I agree with the recalculation.
I had forgotten to factor in the difference in exchange rates in my final calculations.
This means that in this case the Tangerine CC deal is about 1% better than the Amazon Chase one.

I would expect the rebate to be based on whatever the line item cost was on the statement, which is normally expressed in Cdn$ on credit card statements inclusive of fee. Presumably this includes Forex fee. In the past I had assumed this was in part because they wanted to hide the fact that there was this exorbitant fee. However, Tangerine is being a little bit more public about it, so it is possible they will handle it differently.

Loonie said

Thanks for the info on how the claims process works. I have never made a claim, although my CC has primary insurance.

You are still better off though, to have primary insurance. If, for example, you have $1000 deductible, and buy a $2000 TV, and it is damanged/lost/stolen, you would still likely lose $1000 with secondary CC insurance because it would be unwise to use your house insurance for such a relatively small claim.

Obviously secondary insurance is a lot cheaper for the credit card companies to offer, as there will be far fewer claims. Most purchases are probably less than the deductible on home policies.

Well if the $2000 TV was lost/stolen , then I'm sure there are likely other items in your house that are in the same state lol, which would likely make it a big claim that one should for sure claim under their home insurance in addition to their credit card insurance to get the deductible reimbursed.

If the $2000 TV is simply damaged in some way (within its first 90 days), then its likely you could get it repaired for an amount that is much under $2000. So it is likely you can be reimbursed 100% or at least very close to it.

djino

Loonie said

TV (or any new purchase) could be stolen from your car, and often is, so it would be a solitary claim.

Would that not be a claim through your auto insurance which likely would include broken windows and other damages?

Does this even happen often? A new TV purchased left in a car?

djino

Loonie said

No, it's not an auto insurance claim. I did have an experience with that many years ago, before insurance companies became so picky about renewals. Would never claim it again.

Yes, it certainly does happen, especially around Christmas time. I guarantee there will be warnings about it from the police during the Christmas season again this year. The specifics of the TV are not important. It could be something else.

The point is that primary insurance is better than secondary insurance. I don't think anyone can deny that, however much they think they won't need it.

Oh for sure, I completely agree. But I believe the scenarios you mentioned would be pretty rare (i.e., low risk) that one should not be shopping for a credit card product specifically based on the fact that the Purchase Assurance is primary or secondary.

If it were somewhat important, I'd rather simply increase my Home Insurance deductible . You'd likely be better off as you'd likely be choosing a bad credit card product involving fees just to get that type of insurance to be primary.

djino

Loonie said

The possibility of ANY incident of theft/loss/damage is probably low risk for most people.

People can make their own decisions about which criteria they value in choosing a credit card. I am merely pointing out factors that may not be immediately obvious. For some people, this insurance is really important, so they should know what they're getting.

It may also be helpful in choosing between two cards which otherwise offer very similar benefits.

I can agree with that.

But I find the majority of credit card users do not even know that this type of insurance exists or at the very least have never thought to make a claim against it.

I've only done it once in my life myself.

djino

I agree that most people would be better off to increase their deductible on their home policy (and, if it is important to them, spend money on a better credit card's annual fee to get primary insurance, which will likely still be cheaper than cost of lower deductible.)

Someone I used to know who worked at a bank in their insurance department said that in her opinion you shouldn't claim on house insurance unless it's a major incident like a fire. According to her, the insurance company would cut you off after 3 or 4 claims. If they were smallish claims, they still counted, so why bother, and why pay for something you can't really use like a low deductible?

Same goes for auto insurance., although I think more people may be aware of this than are aware of house insurance issue.

If you have an old car that has little or no resale value, you should consider dropping the collision coverage as you won't be able to collect on it.

We dropped ours after 2 mechanics told us that although the vehicle has only about 110,000 km and is in good driving and body condition, they wouldn't give us a cent for it and didn't think we could get anything for it anywhere else either. The car is 11 years old. The car wasn't in need of major repairs, just too old.
When I called the insurance broker to advise them of our decision not to renew the collision, they seemed very surprised and asked why we would do that, even though they know perfectly well how old the car is and that most cars that age would have more mileage and be in worse shape. I told them what the mechanics had said and they had no response. This was their opportunity to give me a different argument, if one existed.
So, I conclude that a lot of people are probably wasting money on collision insurance as well as house insurance, as there are a lot of older cars on the road.

That was over a year ago. We are still driving the car, and it's still not costing much to keep it going even though we are not DIYers. When it goes, it goes, and the Kidney Foundation (or similar organization) will come and tow it away and sell it to the scrapyard and give us a tax receipt for scrap value.