Credit cards compete to make you feel like a VIP
Travel credits, luxurious perks and unique materials aim to turn your and others' heads
Covers cool and trendy credit card stories
There are a few credit cards out there that are so exclusive that the clientele feels as though it’s mainly made up of celebrities and billionaires.
The American Express Centurion card (also known as AmEx’s Black Card) is one example. It’s available by invitation only, and if you’re lucky enough to score an invite, you’ll pay a $7,500 initiation fee and a $2,500 annual membership fee to carry the card.
In exchange, the VIPs who carry the Centurion charge card enjoy legendary concierge service (think personal assistants) and free upgrades with AmEx’s travel partners.
Most consumers won’t ever have access to a card as exclusive as the Centurion, but there is a host of less exclusive but impressive credit cards that can still make you feel like a member of an elite club.
American Express launched the elite card category decades ago with its Platinum card. In recent years, Citi, Chase and others have introduced cards targeting the same audience. U.S. Bank entered the fray in May with its new Altitude Reserve Visa Infinite card.
“Consumers are really seeking personalized services and unique experiences, and they know that they can get that value through their credit cards, whether it’s travel support through a concierge service or other conveniences,” says Marina Kissam, vice president of customer experience for Luxury Card.
Luxury Card offers a suite of three Mastercards (including the 24-karat gold-plated/carbon Gold Card and a stainless steel front/carbon back Black Card).
While uber-premium cards used to be known for their extraordinary perks, competition among the banks means that many now also offer robust rewards programs.
The Chase Sapphire Reserve, for example, rolled out in 2016 with a whopping 100,000-point sign-up bonus (now a still large 50,000 points), travel credits and an array of plum perks.
The Reserve’s launch, which was so successful Chase temporarily ran out of the metal cards, shows issuers are aiming to become “top of wallet” for affluent consumers. And issuers are fighting to stay there, too, as seen in American Express’s revamp of its Platinum card at the end of March, increasing the card’s sign-up bonus to 60,000 points.
As the economy, wages and consumer credit improve, more consumers may be able to access these elite credit cards.
“The credit card issuers are really going after those people who have a decent salary who are willing to absorb larger annual fees and are willing to spend deeper into their line of credit,” says John Ulzheimer, a credit specialist who has worked for Equifax and FICO.
For card issuers, affluent consumers are a prime audience.
Wealthy and aspiring, well-to-do customers spend more, and that means more interchange fees for the card issuers. And in an era of rising interest rates, any balances carried over and late fees add to an issuer’s revenue.
“We’re at a great place in the industry,” says Ali Raza, a principal with CCG Catalyst Consulting Group. “There’s a view that some regulation may go away or be lessened, so you’ve got a number of very large credit card issuers that are saying ‘I want to invest, and I want to invest in attracting a very attractive and profitable demographic.’”
While those rich rewards, extravagant perks and plum sign-up bonuses are the lure of elite cards, these cards that make you feel special come at a price – high annual fees.
With premium cards – as with any credit card – the key to determining whether one is right for you comes down to assessing the value of the rewards and perks and making sure you use them.
For example, most elite rewards cards include access to exclusive airport lounges and many offer travel credits. Each of these premium perks can save frequent travelers hundreds of dollars a year, and that can help make up for a chunk of a card’s annual fee.
“If you’re getting value in excess of what your annual fee is, then it’s no different than buying something at a discount at a store,” says Ulzherimer. “If you’re happy with the value, then there’s nothing wrong with paying a higher annual fee.”
You also get that priceless prestige factor of plunking down your elite (and sometimes heavier metal) card. For some, gold, black and other uber-premium cards can make you feel like a VIP, and that alone may make the annual fee a small price to pay.
See related: Rewards card reviews
- Guide to sharing credit card rewards with authorized users – Earning rewards as an authorized user doesn't mean you're automatically entitled to use them – but you could negotiate a plan with the primary cardholder ...
- Third-party travel site mistakes you should avoid – Third-party travel sites are convenient and may offer great rates, but they might not always offer the best price or let you earn travel rewards. Avoid these booking mistakes by shop comparison first ...
- Use rewards to save on these 5 great Thanksgiving destinations – Want to take a family vacation instead of the traditional dinner at home this Thanksgiving? Here are five great destinations, and how you can save on travel costs with credit card rewards ...