Diamond. Platinum. Gold. Regular. Silver. Perfect. Premier. Elite. Rewards.
These are just a few of the words used to describe the 200+ credit cards offered by Your Credit Network – the trouble is, how do you as a consumer know the difference? From perfect to platinum, and rewards to regular, this blog entry will explain the basic differences between the various credit card types so you can make the best decision when applying for a credit card online.
No matter which word a credit card company chooses to use to describe a credit card, there are two basic types: platinum and regular. These two types of cards are usually issued to a consumer based on their credit history, and though the differences in specific reward programs can vary from company to company, the basic principles behind why certain features are available remain constant.
Good credit can take years to build, but a sure fire way to get on the path to great credit is by making regular payments every month. We cannot stress enough how much missing a payment with hurt your credit rating – you’d be surprised how many platinum credit card applications are rejected on the basis of just one missed payment!
Platinum Credit Cards and Their Perks
Platinum credit cards often have many perks available to their members, due to the fact that the cardholders usually have very high or great credit scores. Platinum cardholders work their way up the ranks by paying and establishing better credit for themselves. Some of the great advantages that may be associated with platinum credit cards are:
- Lower interest rates
- Higher credit limits (and more frequent credit limit increases)
- No annual fee
- More benefits, savings & rewards, including:
- travel accident insurance
- fraud protection service
- cash back programs
- frequent flier miles
Platinum credit cards offer such great rewards because credit issuers are trying to cater to people with excellent credit. If a credit card company sees that you have outstanding credit they are going to want to keep your business, which is why so many offer platinum credit cards to set you apart from the people with just good credit. Being offered a platinum credit card is a company's way of rewarding you for having great credit, while at the same time trying to attract (or maintain) your business.
Regular Credit Cards
Regular credit cards (such as gold, silver or cards without fancy titles) are more for establishing or rebuilding your credit. You might not be getting the same rewards as a platinum card, but you are building your credit while taking advantage of the customer service for which many banks are well-known. With these cards, you are not offered as high a limit and you may face higher charges if you fail to make payments. As long as you pay the bills on time and build your credit then you may be offered a platinum card in as little as three months.
In many cases these cards are used by people that don't have as many assets at their disposal – students would be a great example of this. Students usually don't have platinum credit cards because they do not have excellent credit, nor do they often own homes or other larger assets with which credit might be built. Even though regular cards don't have the same perks as a platinum card they do offer some attractive features:
- Fair APR
- Reasonable credit limits
- Low annual fees
- Limited benefits & rewards, including:
- cash back programs
- extended warranties
How to Get Platinum Credit Status
With most cases platinum credit cards are just not for everyone, especially if you have a troubled credit history. It may take years to earn the status that comes along with being a platinum card holder, but establishing yourself as borrower who can pay off debt in a reasonable amount of time is the first step toward gaining great credit. Once you have shown credit card companies that you have the ability to pay your bills and you're not a risk, they just might offer you a platinum credit card.
Additional Resources:
Phillip Sunders
Team Your Credit Network