Financial Guide

Credit cards with discounts, additional services or bonus programs

 

With a credit card you can only pay and withdraw money? Far from it! Some credit cards offer their owners not only their basic features but additional benefits, as well. Those benefits range from discounts and bonus programs to additional services, such as insurances. In most cases these cards are the so called Gold or Platinum Cards.

As credit institutions want to earn money, too, this type of credit card requires you to pay a monthly or a yearly fee. In some cases, costs for payments and withdrawals can also be higher than for credit cards without additional benefits. Even the interest in case you do not repay the money in time can be higher than usual. Thus, you should carefully consider if the advantages are big enough to justify the fees.

To give you an overview and to help you make a decision whether a credit card with additional benefits is the right choice for you, we will introduce some examples.

 

Credit cards including insurances

Insurances are quite common as additional services provided by credit cards. In addition to travel insurances like travel cancellation insurance or travel health insurance, car insurances for rental cars as well as insurances for the purchases made with your credit card are offered by the credit institutions.

Travel insurances are handy for people who travel a lot and do not want to miss sufficient insurance cover when travelling abroad. As the travel insurance does not have to be contracted for each journey, it can be a convenient solution to choose a credit card that comes with such a benefit.

However, you should not get such a credit card light-headed. In some cases the insurance does not cover all services so that customers have to pay a deductible. Therefore, you should carefully read the small print before getting a credit card with an insurance as additional benefit.

Some examples for credit cards including an insurance are the Santander Travel Card, the Advancia Mastercard Gold or the Targobank Premium Credit Card. You will find a detailed comparison of credit cards including insurance services here.

 

Credit cards with bonus programs or cashback

In this category you have two different types of credit cards. First, companies which already offer a bonus program to their customers that issue a credit card that can be combined with this bonus program. Examples for this card type are the Lufthansa Miles & More Credit Card or the Payback credit card. With every purchase or payment you can collect miles or bonus points.

Second, credit institutions offer their own bonus programs where you can spend the collected points for various sorts of discounts. With DKB you can redeem your points at more than 10,000 different restaurants or shops.

 

Discounts

Some credit cards do not help you save money indirectly via a bonus program but by giving you direct discounts. For example, cards with discounts at gas stations are very popular. Logically, this is particularly advantageous for people who drive a lot. Most cards are contracted to a certain gas station chain and only grant a discount until you reach a certain amount. This means: read the small print thoroughly and only decide on a card after having thought it through carefully if it makes sense to get such a card. For this kind of card you usually have to pay a fee, as well. If you do not use the maximum discount, it’s often not worth getting this kind of credit card as it will not save you any money.

Finanztip has examined some Gold and Platinum Cards and summarized their advantages and downsides. You will find their results here (German only).