Does it make sense to get the Apple Card if you already have a rewards credit card like the Chase Sapphire Reserve?
Hollis Johnson/Business Insider
- Apple has finally launched its own credit card, and it compares favorably to other cash-back cards.
- But, if you have another good rewards credit card, it probably doesn't make sense to get the Apple Card.
- And if you don't have a good rewards card, there's a good chance that getting one would make more sense than getting the Apple Card.
- Especially if you travel frequently, a card with more benefits like the Chase Sapphire Preferred Card or the Chase Sapphire Reserve will be a better choice.
The inevitable has finally happened: Apple has its own credit card. Marketed as a card "created by Apple, not a bank," the Apple Card was designed to seamlessly integrate with your Apple profile as just another beneficial Apple device to add to your stash.
This seems pretty great and honestly, it probably is. As we all know, Apple is incredibly innovative and proficient at expanding our tech horizons by building devices that communicate well with one another, and this credit card is no exception. But what if you aren't looking to expand your credit profile because you already hold a rewards credit card or a cash-back credit card? Do you need to add Apple to your wallet?
The Apple Card vs. the crowded credit card market
First of all, let's talk about the main selling points. As an Apple Card holder, you'll have the option to use your digital card or the laser-etched titanium physical card, but to me, those things are neither here nor there. Plenty of cards come with digital options these days, and lots of cards have metal designs as well.
For me, the coolest thing about this card is the digital interface. From your phone, you can access all of your spending history (complete with an actual map of all your purchases) as well as your remaining balance, spending trend analysis, and timeline.
Even though this is pretty neat, most other cards come with a similar service. American Express cards, for example, give you a detailed list of transactions as well as a pie chart broken down into spending categories. While Apple's design is potentially more user-friendly and chic, creditors have been offering these services for a while now.
The benefit that gets me most excited about Apple Card is that it's completely fee-free, which means that there is no annual fee and no foreign transaction fees, and cardholders won't get penalized when they accidentally miss a payment. Although credit cards that charge an annual fee generally come with much better benefits (like the Priority Pass membership and annual travel credit with the Chase Sapphire Reserve) no-annual-fee cards give casual cardholders peace of mind.
Read more: The best no-annual fee credit cards
On top of that, the Apple Card's variable APR runs from 12.99%-23.99 - some of the lowest interest rates in the industry.
Using Apple Card, you will be entitled to daily cash back rewards that vary from 1% to 3%. This is also pretty neat, because your rewards come back every day instead of monthly, quarterly, or annually. You'll see that cash credited to your Apple Cash card in the Wallet app at the end of each day.
You'll earn 3% on all Apple purchases as well as Uber and Uber Eats when you use Apple Pay, and get 1% cash back on all non-Apple Pay purchases. Most of the time, you'll be getting 2% cash back on all purchases made through Apple Pay, so this can more or less be considered a 2% cash-back card.
Read more: The best cash-back credit cards
Are there better options than the Apple Card?
Since the Apple Card is basically a 2% cash-back card, let's compare it to the Citi® Double Cash Card.
With Citi Double Cash, there aren't any spending categories; you simply earn 1% cash back on all purchases and then an additional 1% cash back as you pay your balance, making 2% total. Like with the Apple Card, there are no caps or annual fees. This card comes with a 0% intro APR on balance transfers for the first 18 months after opening your account, and then it's a variable 15.99%-25.99%, which is also relatively low for the industry. There are foreign transaction fees, but Citi Double Cash is really best for domestic, everyday purchases rather than travel. For the sake of comparing a 2% cash card to a 2% cash card, Citi Double Cash aligns pretty well with the new Apple card.
If you're traveling, though, it makes more sense to invest in a travel rewards credit card than to rely on a cash-back card. The aforementioned Chase Sapphire Reserve is consistently voted amongst the best, but the Chase Sapphire Preferred is an excellent alternative if you can't swing the $450 annual fee for Chase Sapphire Reserve - it still offers bonus points on travel and dining and offers protections like primary car rental insurance.
Read more: Chase Sapphire Preferred review
Read more: Chase Sapphire Reserve review
Bottom line: Unless you're a die-hard Apple groupie, there really isn't any reason to add Apple card to your wallet if you already have a good rewards card. This is especially true if you have a travel rewards card, since they come with perks that out-compete Apple every time.
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