The Best Charge Cards (vs Credit Cards) of 2012

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Do you have a charge card? Do you know what it is? Would you ever need one versus a debit card or a credit card? Today I’m going to look into charge cards: a bit of their history, their advantages / disadvantages, as well as some of the best charge cards available today.

The Best Charge Cards

Here are the most notable personal charge cards that I’m aware of on the market:

ZYNC from American Express(SM) – The ZYNC card is the newest charge card from American Express. It’s targeted at younger consumers who want more custom perks with their cards. With this card you can earn 10,000 Membership Rewards Express(R) points with your first purchase. That’s basically a $100 bonus. You can customize the card with features and benefits that suit your lifestyle. It naturally comes with zero interest because you pay in full each month, like all charge cards. You can receive Membership Rewards Express points for every eligible dollar you spend, then redeem points for great travel, shopping, and entertainment rewards. The annual fee is $25. See my full review of ZYNC from American Express.

American Express (R) Preferred Rewards Gold Card – With this charge card you will earn 10,000 Membership Rewards(R) bonus points when you spend $500 in your first 3 months of card membership – this is redeemable for select gift cards valued at $100! The card places you in the Membership Rewards program, which allows you to turn your everyday purchases into Membership Rewards points, and then redeem them for a collection of travel, shopping, dining and entertainment rewards. This card also makes you eligible for Gold Card Events, which are exclusive access to tickets for select concerts, shows, major sporting events, and more in cities nationwide. I know a friend who did this last year at the World Series here in Texas. He was able to go down on the field before the game and see the players up close. The annual fee is $125 starting in the second year.

Ink℠ Bold with Ultimate Rewards – Unlike the other cards on this list, the Ink℠ Bold with Ultimate Rewards is a charge card, not a credit card. This means that when the statement in the mail comes, the entire balance is due. If you’re business spends a lot, you can earn 47,500 bonus points every year! 7,500 for your first $25,000 spent, 15,000 for your next $25,000 spent and another 25,000 for your next $50,000 spent. Yes that means you have to spend $100,000 a year to obtain these points but most businesses can find ways to do that. With another 25,000 bonus points given after your first purchase and no annual fee for the first year ($95 thereafter), the Ink℠ Bold with Ultimate Rewards is the ultimate small business charge card.

American Express(R) Premier Rewards Gold Card – With the Premier card, you will earn 15,000 Membership Rewards(R) bonus points when you spend $1,000 in your first three months of card membership. You can build up Membership Rewards(R) points fast – earn 3X points on airfare, 2X points on gas and groceries, and 1X points on everything else. No annual fee for your first year of Card membership; $175 thereafter. Use Pay with Points at American Express Travel and fly any airline, anytime, anywhere, with no blackout dates or seat restrictions.

The Platinum Card(R) from American Express – With this top tier card, you can earn 25,000 Membership Rewards(R) bonus points when you spend $2,000 in your first three months of Card membership. Get up to $200 in Airline Fee Credits annually to cover incidental fees with your favorite airline. Airport Club access for you and your guests. Platinum Card(R) Concierge is at your service 24/7 to help with gift buying, reservation making, and more. FINE HOTELS & RESORTS program offers special upgrades and amenities at more than 600 locations worldwide.

History of the Charge Card

Do you ever wonder why we say “charge it” when we’re using our credit card? Shouldn’t we be saying “credit it”? Well, at one time all we had was a charge card. The charge card was introduced in 1950 by a company that would eventually become Diners Club.

Charge Cards vs. Credit Cards

A charge card is different from a credit card for several reasons.

1. The balance is due in full each month.
2. There is no minimum payment. The minimum is the entire balance.
3. There are no interest charges.
4. Late payment results in major fees and possible cancellation.
5. It’s not revolving credit, it’s just a short-term loan.

Benefits of the Charge Card

Noting some of the points above, you can see that depending on your circumstances, the charge card can help you stay out of debt.

The charge card can also help you build a credit history. It can also help protect you from defective product purchased.

Lots of business owners typically find value in a charge card. Since they work like a short-term line of credit, they can help small business owners stay flexible during the month if cash flow is poor. At the same time, a charge card would discourage a business owner from racking up a bunch of revolving credit card debt.

Lastly, charge cards have perks. The charge card brings with it great service and access to rewards that you wouldn’t normally get with a debit card or regular credit card. That is, except for the rewards checking account and debit card from PerkStreet, who offers 2% cash back.

The Downside of Charge Cards

Charge cards aren’t without their negatives. They typically come with annual fees. Also, while a charge card helps your credit history it doesn’t help your credit utilization since you don’t have an approved spending limit, like that of a credit card revolving debt.

Charge Card Companies

Traditionally Visa/MasterCard have been the card company to provide debit and credit cards, while American Express has provided both credit cards and charge cards. Diners Club is also in the charge card business. Telly Savalas, baby!

What’s your take? Do you have a charge card? Would you ever use one?

Disclaimer: This content is not provided or commissioned by American Express. Opinions expressed here are author’s alone, not those of American Express, and have not been reviewed, approved or otherwise endorsed by American Express. This site may be compensated through American Express Affiliate Program.

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