I know you've seen it. I know you've thought about it, late at night. You think about the glow, the allure, the mystique. The devil on your shoulder says to go for it. The angel on your other says no.
But you want to know how it feels. You want to be bad.
You want a premium credit card.
Don't worry, you're in a safe space.
Do not fall victim to the headlines. Don't let yourself be fooled into thinking you're not worth it. You are.
The myth of premium credit cards is that you have to be straight loaded and make it rain by the truck loads to get one.
You don't need to spend like Weezy to get a premium card.
The reality is, you just need good credit and a steady income.
Credit card companies, more than anything else, want customers that pay their bills. After all, spending millions doesn't do any good if they never get paid.
So let's talk about the mysterious sex-kitten that is the "Premium" Credit Card.
What Classifies as a Premium Card?
Premium cards generally come with higher annual fees over $200. The only exception is the Amex Gold Card and Platinum Delta Skymiles card that both come with a $195 annual fee (Gold is waived the first year) that hover in this weird purgatory.
What does a Premium Card come with?
Generally, premium cards come with elevated, "premium" perks like lounge access, travel credits, etc...
Each one is different but if you're going to get a premium card you need to get either statement credits, lounge access or hotel upgrade perks.
How much will a Premium Card cost me?
Most premium cards come with annual fees of either $350 or $450 per year, but they almost never waive the annual fee.
How do I extract value from a Premium Card?
I know it's easy to get scared off by a $350-$450 but let's walk through it.
Take the Citi Prestige card that I have, with a $450 annual fee.
The card comes with a $250 airfare credit, dropping my effective annual fee to $200 off the bat.
It also comes with a 4th night free benefit, which if you book one trip should wipe out the remaining $200 fee at least, most of the time helping you make money.
On top of that you have the Admirals Club Access which retails at $450.
So for $450 you get at least $200 + $200 (conservative 4th night rate) + $450 = $850 in value for $450. Mind blown, right?
What are the best premium cards?
Best Premium Transferable Point Cards - Ranked
Chase Sapphire Reserve
American Express Platinum
Bonus Spend: The Sapphire Reserve earns 3 points per dollar on airfare/hotel and 3 points per dollar on dining. The Prestige earns 3 points on airfare/hotel, 2 points on dining. The Platinum earns 2 points per dollar on airfare/hotel only when you book through their travel portal.
Rank: 1. Sapphire Reserve 2. Citi Prestige 3. AMEX Platinum
Statement Credits: Sapphire Reserve comes with a straight $300 travel statement credit. Book a $300 plane ticket on any airline, get the full statement credit. Prestige comes with a straight $250 travel credit. Platinum comes with a $200 airline fee credit for upgrades, checked bag fees, or sometimes gift cards on the airline you select. All come with $100 credit for Global Entry/TSA Precheck. Prestige comes with a 4th night free statement credit.
Rank: 1. Prestige 2. Reserve 3. Platinum
Signup Bonus: CSR comes with 100,000 points after spending $4,000 in 3 months. Prestige comes with 40,000 points after spending $4,000 in 3 months. Platinum comes with 40,000 points after spending $3,000 in 3 months.
Rank: 1. CSR 2. Platinum 3. Prestige
Perks: CSR comes with rental car perks like status with National/Avis, access to its Luxury Collection Hotel program and Priority Pass access. Prestige no longer offers Admirals Club Access for new applicants, but existing applicants have it until July of 2017, three free rounds of golf (also ending next year), and also comes with the most extensive Priority Pass Select membership of any other cards. Platinum comes with access to its Fine Hotels and Resorts program, arguably the most respected hotel program in the world that comes with complimentary upgrades, late checkout, etc... It also comes with access to its expanding selection of airport Centurion Lounges, which are baller.
Rank: 1. Platinum 2. Prestige 3. CSR
Status: The Platinum card is the only card that offers complimentary status for the cardholder, providing Starwood and Hilton Gold Status. Starwood Gold status is badass, Hilton is cool too.
Rank: 1. Platinum 2. Prestige/CSR (tie)
The Final Word
As always, it depends on what you're looking for. If all you're looking for is lounge access and status hacks then the Platinum Card is the one for you. If you're looking for a card you can use for everyday spend also, grab the CSR. If you don't qualify due to Chase's 5/24 rule (if you've opened 5 applications in 24 months) then grab the Prestige. Both the CSR and Prestige have quick ways you can bring that annual fee down quickly.
Best Co-Branded Premium Cards
Chase Ritz Carlton Rewards Card
American Airlines Executive Card
United MileagePlus Club Card
Bonus Spend: The Ritz card earns 5 points per dollar at Ritz/Marriott properties, and 2 points per dollar on airfare and dining. The AA Exec card earns 2 miles per dollar on AA purchases. United Club earns 2 miles/dollar on United Flights and 1.5 miles per dollar on everything else.
Rank: 1. United 2. Ritz, 3. AA
Statement Credits: Ritz gives customers a $100 hotel credit on paid stays at Ritz properties in addition to $100 flight discounts on itineraries of two passengers or more (unlimited). AA offers a $100 Global Entry/TSA Precheck statement credit, as does the Ritz card.
Rank: 1. Ritz 2. AA 3. United
Signup Bonus: Ritz offers 3 free nights at tier 1-4 properties after spending $5,000 in 3 months. AA offers 50,000 miles after spending $5,000 in 3 months. United offers a $100 statement credit after your first purchase.
Rank: 1. Ritz 2. AA 3. United
Perks: Ritz comes with three Club Level upgrades on paid stays yearly which represents minimum value of about $100/night, in addition to Gold Status with Ritz and Marriott and Priority Pass membership. AA offers full Admirals Club membership. United offers full United Club membership, Hyatt Platinum Status, Hertz President Circle Status and access to the Luxury Hotel Collection.
Rank: 1. Ritz 2. United 3. AA
The Final Word
As always, it's all about what you want. While I think the Ritz card is incredibly valuable as it provides Marriott Gold status as well as what can be a massively valuable unlimited $100 airline itinerary discount, if you value airport lounge access above all you need to choose between the AA and United card, depending on what airline you will be flying. I personally value lounge access very highly, so even though it doesn't seem like AA Executive offers much, if you fly even five or six times per year it's worth it.
So, I should go for it????
As long as you feel comfortable being able to afford the annual fee (which you have to pay on your first statement) and you will actually be able to extract more value than the annual fee costs you, go for it. A lot of those perks are highly valuable and are worth the money.
Do the math first. For instance, the Platinum Card is great if you frequent an airport with a Centurion Lounge or if you will be able to utilize Fine Hotels and Resorts. If neither of those apply to you, it's a waste of money.
If you don't fly often, stay away from the co-branded airline cards.
If you qualify, I think the Chase Sapphire Reserve card is a no-brainer.
If you book flights for you and your significant other a few times per year, the Ritz card can make a lot of sense.
The main message here is to not get scared off by an annual fee. Many times you can make the most money on these cards. Just make sure that it makes sense.