Ooh, it’s titanium! It’s Apple! That’s why you should immediately run out and get it, right? Wrong. If you wipe away the luster of the Apple brand, you’ll find that for most people, the new Apple credit card is simply a mediocre financial product. Most people will do much better with cards that earn miles and points (or if you don’t travel, even a straight cash back card).
Harder to Use Than Most Cards
Apple touts the security of their card. While it’s true that a card without a credit card number or CVV is more secure, it’s also much less usable. Many retail establishments require typing the last 4 digits of a card into the register, and without a number on the card, this will be impossible. Online purchases are all but impossible without using Apple Pay. Given that consumers aren’t liable for fraud anyway, the security isn’t worth trading for convenience.
Oh, by the way, have an Android phone? You’re completely out of luck. The Apple credit card requires pairing with an iPhone to work.
Less Generous Rewards
Let’s cut to the chase: Apple’s rewards structure is, frankly, uninspiring. The card has no annual fee but gives only 1% cash back on most purchases. The only exceptions are purchases directly from Apple, for which you get a 3% rebate, and purchases made with Apple Pay, for which you get a 2% rebate. Most places don’t take Apple Pay, and most people don’t make the majority of their purchases from Apple.
Apple does pay out rewards instantly, unlike most cards which give rewards at the end of the statement cycle. In practice, this doesn’t buy you much – having a 10 cent rebate on a $10 purchase isn’t worth giving up the other 1% you could get back with a comparable no annual fee cash back rewards cards such as Citi Double Cash or the Fidelity Rewards Visa Signature Card.
No Outsize Value
If you travel using miles and points, you know that it’s possible to get outsize value from award flights. It’s not uncommon to get more than 10 cents per point in value when booking international first and business class flights! When you consider that the American Express Gold Card pays a generous four points per dollar spent at grocery stores, you could effectively walk away with a 40% rebate on every dollar you spend. Even if you value Membership Rewards points at only 2 cents per point (which is readily achievable even for economy class flights with transfers to most Amex mileage program partners), you’re walking away with an effective 8% rebate. Not every points-earning credit card offers this kind of outsize value, but with travel rewards credit cards, you can almost always do better than the 1% that Apple gives you on everyday purchases.
Granted, not everyone can get this kind of value out of travel rewards. But they shouldn’t get the Apple card either. Instead, they should go for a 2% cash back rewards card.
The Bottom Line
At the end of the day, the Apple credit card has a slick presentation and a polished marketing machine behind it. But if you love to travel, it’s objectively one of the worst cards you could put in your wallet.
Are you thinking about getting the new Apple Credit Card?
[Image Source: Apple]