Are Gold and Platinum Cards Suitable for you?
Gold and Platinum credit cards are premium credit cards offered to customers with higher incomes. They usually offer a higher credit limit as well as more attractive bonus features and better reward packages. They also generally come with a higher rate of interest and higher fees, but it’s usually designed to be a worthy trade-off provided the card features out-weigh or equal the costs.
How to Choose the Best Gold or Platinum Credit Card?
Gold and Platinum cards are all about the perks and the reward packages, so choosing the best one for you depends on your lifestyle. They may appeal to a high spender, a time-poor person, a frequent diner-out or someone considering the value of free purchase protection and travel insurance.
When shopping around consider the interest rates, annual fees, and a reward package that suits your need and how they impact the value that you receive.
Avoid the biggest mistakes
The biggest mistake with Gold and Platinum cards is choosing features that don’t offset the costs. You should choose a card that offers a range of benefits and features that you will most likely use and also give you value for money.
Note: Before applying always read the terms and conditions.
What is a gold card?
A gold credit card can also be called a standard rewards credit card, and is usually the first rewards credit card someone gets.
Gold cards offer certain benefits besides just credit when you use the card to make purchases. They also come with a higher credit limit than a standard credit card and because of this a gold credit card will usually have a higher than average customer income requirement to be eligible.
Typical benefits you can get with a Gold card include:
• Higher than average credit limit
• Rewards points
• Purchase protection and
• Extended warranties on goods you buy with the card. This can mean you have up to 12 months more cover than the manufacturer’s warranty allows
What is purchase protection insurance?
Purchase protection insurance is also often called purchase security in the credit card insurance booklets. It offers cover for a certain period (usually 3 months/90 days) and that entitles you to cover against loss, theft or accidental damage. This cover can be for goods bought anywhere, but in some cases goods may have to have been bought or manufactured in Australia. You can check this in the insurance booklet for the specific card you are looking at.
What is a price guarantee?
A price guarantee is a way to ensure that you paid the lowest available price when using your credit card to make a purchase. It allows you to claim the difference in price if you bought an item and saw it cheaper or on sale somewhere else.
For example, if you buy a handbag for $150 and see it the next week in a shop window for $125, so long as you kept the receipts and can prove the lower price exists, you can claim a refund of the extra $25 back onto your credit card.
What is a platinum card?
A platinum credit card is the next level up from gold, and can offer many of the same insurances and benefits, but for higher value. This might mean that the same rewards program is available, but platinum cardholders get more points per dollar spent, or might find that certain fees or conditions might be waived. Platinum cards may also come with additional insurances, such as flight inconvenience insurance or car rental excess cover. Concierge services, as opposed to just global customer service for your card, are often a feature of platinum credit cards as well.
Platinum credit cards can often be associated more with prestige and the minimum income and minimum credit limit requirements can be higher in some cases.
Which platinum credit cards offer the most generous rewards, bank or merchant ones?
Whether you think one rewards scheme is more generous will depend on what you would use your points to claim, what fees you’re paying and how good the rewards on offer are. There is, however, some data from the RBA comparing the earn rate for bank branded cards and merchant branded cards (e.g. American Express or Diners Club) in 2012, in the March bulletin The Personal Credit Card Market in Australia: Pricing over the Past Decade. According to this bulletin bank branded credit cards had an earn rate of $18 000 spend on the card for a $100 voucher; while merchant branded cards showed $12 600 spend for a $100 voucher. So, by this measure merchant branded cards will accumulate vouchers more quickly.
How should I decide whether to get a platinum credit card?
Deciding on the right credit card can really only be done by you, the individual in question. Often the decision comes down to what card will suit your spending habits and allow the most benefits. Of course this is apart from the interest rate and interest free days applied when you use the card (these are always important considerations for choosing any type of credit card).
To understand what you will get out of a particular platinum card, it can help to consider how often you will use the card, how much you will spend on eligible transactions; those which earn points or bonus points, or activate insurance benefits.
Overall this can show you what you need to spend to justify paying whatever annual fee is attached to the card.
Should I book my holiday on my credit card if I have a gold or platinum card?
If you have a gold or platinum credit card which includes travel insurance, in almost all cases you will need to book your tickets and/or accommodation (or a significant portion) using the same credit card that comes with the insurance to activate it. Of course, any other travel insurance you have taken out, or plan to take out, will also be an important consideration. You should check what each option has to offer and compare them against your travel plans and needs.
Do gold and platinum cards offer frequent flyer points?
Gold or platinum credit cards can also have the option to earn frequent flyer points. Some cards on our table above are linked to a particular program, such as the Bankwest Qantas Platinum credit card, while others are linked to the bank’s own rewards points, such as the HSBC Platinum credit card.
When a card is linked to a bank’s rewards program, it is important to check which frequent flyer program you can transfer points for, as this may not be allowed for all frequent flyer programs. With the HSBC platinum card, for example, you can transfer Rewards Plus points into KrisFlyer miles or Cathay Asia miles. If you want to earn Qantas Frequent Flyer points, you would need to choose the HSBC Qantas Rewards card and become a member of the Qantas Frequent Flyer program separately.
Each card can have different relationships when it comes to rewards points and partners, and may offer the option to book flights with any airline through a separate partner, so check this for the particular card you are interested in. You can also view the range of frequent flyer cards on our frequent flyer table if you are only interested in earning frequent flyer miles.
Do balance transfers on gold or platinum cards earn rewards points?
A platinum or rewards card concierge service can help with different administrative tasks you might not always have time to do yourself, or not know the best way to do them. Some common examples include recommending a list of hotels or restaurants and offering to make bookings using your card (you do still pay for the booking). Other uses for a concierge service include:
• Researching – transport or entertainment in an unfamiliar location
• Buying gifts or flowers (including sending a list of quotes for you to choose from then ordering the one you choose)
• Buying concert or theatre tickets
• Telling you the places you can buy certain items in a foreign country
• Finding and booking a removal service
Why is the annual fee on gold and platinum cards so high?
The annual fee on gold and platinum cards is higher than for credit cards that don’t offer the extra perks and insurances because the fee is one way that the banks and credit card companies fund the services provided with the card.