For the vast majority of people, a decent credit score and fairly clean financial background are enough to get all the good credit cards. It’s par for the course as most of us understand it: the better your credit, the better your limits and rates on credit cards.
So what happens if your financial background is impeccable, and your bank account is high in the hundreds of thousands, and you fall into the 1% or so of United States citizens that are considered “ultra wealthy”?
Joining the Exclusive Credit Card Club
The answer, of course, is to find a credit card designed for you and your lifestyle. Enter exclusive credit cards, aimed specifically at the ultra wealthy. These cards are marked by requirements like invite-only applications, perfect credit, annual fees in the thousands of dollars, and minimum spending requirements high above the limit of most Americans. The cards are also marked by major perks – sky-high credit limits, for example. But the real draw of the cards lies in their reputations and their sheer ability to get things done.
Need a concierge to ship a special wine to you that’s only sold in another country? Your American Express Centurian card can make it happen. The Centurian, or “Black” card, is invite-only to Platinum card holders, carries an annual fee of $2,500, and requires you to spend at least $250,000 a year.
Need VIP seating at a high-level awards event or the sold-out rock concert of the year? Just whip out the Visa Infinite card. The 24-hour concierge service that comes with the card can pretty much do anything for you… for a price, of course.
Wise Investment… Or For the Suckers?
The question is often asked: are these cards worth what they cost? Are the customers genuinely getting what they pay for, or is this really just another way to fool people out of their money? The answer really depends on you and your lifestyle.
Consider a famous musician, for example. A person like this travels a great deal and doesn’t want to stay in disappointing hotels, might need to be seen at the Grammys and want extra-special seats, throws elaborate parties that require tricky, special-treatment set-ups, and sometimes needs to get through the airport via a secured, exclusive route to avoid getting swarmed with fans. All of those services are things that these credit cards can provide, and the musician is likely to make use out of each and every one of them. In this case, it’s pretty simple to justify a $2,500 annual fee for what the customer gets in return.
But now consider someone with a different type of lifestyle. This person is just as wealthy as the musician, but he or she has a much lower public profile. Perhaps the money was inherited, or earned through a different type of profession such as writing or medical technology. This person certainly could lead the same elaborate lifestyle as the musician, but chooses not to. In this case, the odds of using all those high-end perks on any type of regular basis are pretty slim. The perks are not all that the card offers, of course – there’s that sky-high credit limit, too – but many wealthy people don’t need all that much credit in the first place. For this person, the annual fee is kind of silly since it’s paying for things that are rarely used.
Black Cards with Golden Reputations
Those carrying an exclusive card are most definitely considered “ultra wealthy” by anyone who knows they have it. In fact, for many people the card’s appeal lies in reputation alone. But it shouldn’t; just because you’re wealthy doesn’t mean you have to prove it with your credit card.
Any sensible person will weigh the benefits of the card against the cost, and decide accordingly. If you take full advantage of the services offered by the card, the huge fees and strict requirements can be a great deal considering what you get in return. But if you don’t need the majority of what the card is all about (the perks), and you have it just to have it, then you’ve probably gotten duped by a gimmick, designed and marketed exactly for this purpose: to separate you from (some) of your money.
This post was written by Kevin Fleming who runs CreditShout, a blog that reviews credit cards like Chase Sapphire and helps people to manage their finances.