Richard Greenwood

The Golden Plastic

If your wanting more from your credit card than just a way to spend money and you earn a good income then a Gold card may offer you some extra bonuses such as insurance or priority service.

In the credit card industry, high society is composed of 'precious metals' credit cards like platinum and gold. This has bee mainly due to the fact that credit card issuers need to attract attention...and very few things can call attention as quickly as gold.

Gold credit usually comes in with many freebies since they symbolize higher status. Gold credit cards are designed for people who travel a lot, tend to make many purchases at home or while on travel, and prefer to pay off the entire balance due each month. This profile suggests people with higher incomes. The income requirement for gold credit cards would be in the order of at least $50,000 a year, and this must come in tandem with a solid credit record.

Assuming you have the income and the credit record to qualify for gold credit cards, it may interest you to know that they are especially useful if you want a card with generous reward schemes and/or special insurance cover. If you are in the market for gold credit cards, you may wish to compare the various credit card applications, particularly on the following features:

- Interest rates. Privileges and perks come at a price, and gold credit cards are no exception. High interest rates is the result of generous reward credit cards. Commonwealth Bank's 20.74% p.a. is indicative, and the rates of other gold credit cards will vary around this figure. But since your assumed preference is to pay off all amounts due, the interest rate should not matter so much ? unless you happen to miss a payment.

- Annual fee. Gold credit cards usually have expensive annual fees. Normal range is usually between $90 and $150 annually. You can recover this cost if you ensure full payment on all monthly statements, thus saving you from interests, as well as through generous rewards and benefits package.

- Credit limit. Your gold card credit limit will be higher than standard cards. Some gold credit cards start with a $5,000 credit limit while those with higher annual fees may give $25,000. It is even possible to get one with no preset spending limit. This is certainly helpful especially when you are on an extended overseas trip.

- Special insurance. Gold credit cards provide free overseas travel and accident (including transit accident) insurance cover for you and your whole family. Conditions for cover may vary, so you should carefully compare them. Some issuers also cover you for emergency medical treatment and for expenses incurred due to unexpected trip cancellations, flight delays, missed connections, and luggage delays. It is not uncommon for issuers to require you to pay a significant amount of your travel arrangements using their card.

- Purchase protection and warranty cover. Purchase protection covers you for new purchases (usually personal items only) that are lost, stolen, or accidentally damaged within a 3-month period. Extended warranty on purchases made with gold credit cards covers you for 12 more months after the original manufacturer's warranty has expired.

- Fraud protection. The card should not make you liable for unauthorised or fraudulent purchases, especially when made through the Internet. You may be required to notify the issuer when you suspect your card is being misused.

There may be other benefits like concierge services and extra reward points on particular types of transactions. In sum, gold credit cards may be more expensive (in terms of rates and annual fees) but, provided you manage the usage carefully, you will find them worthwhile.

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