A premium credit card may seem like an unjustifiable luxury given the typically high annual fees. But believe it or not, this type of card can be a bargain for the right cardholder. With nearly all top-of-the-line credit cards having an annual fee of less than $500 a year, these credit cards will offer rewards in the form of points or miles, a range of valuable benefits, and even fee credits that can largely offset these cards’ upfront costs.
For the most part, premium credit cards are marketed toward travelers, although users need not be especially frequent travelers to utilize all of the benefits. One key feature that tends to distinguish cards with annual fees above $200 is that they all offer some form of airport business lounge membership. These airport lounge memberships by themselves often cost $400 to $500 per year, or $50 per visit.
Other benefits of premium cards can include airline fee relief. When cards are co-branded with a specific airline, these take the form of baggage fee waivers for cardholders, while other premium cards that are not directly affiliated with an airline offer an annual fee allowance that cardholders can receive in the form of statement credits. Another fee often credited by premium cards is the $100 applicant fee for the Global Entry program operated by the U.S. Customs and Border Patrol. Once approved, members of Global Entry receive expedited clearance when arriving in the U.S., as well as access to the Transportation Security Administration’s Precheck domestic security program.
Finally, premium cardholders can expect a wide assortment of travel insurance and purchase protection policies. Expect travel coverage for trip interruption, trip delays and lost luggage. In addition, purchases made with a premium credit card are likely to be covered by extended warranties, price guarantees and accidental damage coverage.
With this in mind, we reviewed the top premium credit cards for the overall value they could offer, both in terms of awards and benefits. After much consideration, we’ve picked the top three. Here’s our winner for the Best Premium Credit Card in America.
The Winner: Citi Prestige
The Citi Prestige has redesigned not just its benefits and rewards, but its overall value as well. There is a $450 annual fee for the primary cardholder, and $50 for every additional authorized card user. This card carries no foreign transaction fees.
Cardholders earn three ThankYou points per dollar spent on air travel and hotels, double points for dining and entertainment purchases, and one point per dollar spent on all other purchases. ThankYou Points can now be transferred to miles with 11 different airlines as well as the Hilton HHonors program. Cardholders receive access for themselves and a guest to the American Airlines Admiral’s Club and Priority Pass lounges. Other benefits include a $250 annual statement credit toward air travel costs, including airline tickets, and a $100 Global Entry application fee credit. And of course, this card comes with travel and shopping benefits too numerous to detail.
Applying for a Premium Credit Card
Before you apply for any credit card, carefully do your research and make sure the card’s benefits will meet your specific needs. For example — is the airport lounge convenient for you? Will you actually make use of it? Furthermore, it’s important to know whether you’ll meet the card issuer’s general credit requirements, which means it’s helpful to know what your credit score is ahead of time. You can see two of your credit scores for free through Credit.com. Finally, since much of the benefit of a high-end credit card is with its rewards, it’s ideal not to carry a balance on these cards. If you plan your spending so that you’re able to pay the balance in full every month, then you stand to get the full benefit of the rewards while avoiding interest changes.
Want to see more? Here are our other picks for the best premium credit cards in America.
Note: It’s important to remember that interest rates, fees and terms for credit cards, loans and other financial products frequently change. As a result, rates, fees and terms for credit cards, loans and other financial products cited in these articles may have changed since the date of publication. Please be sure to verify current rates, fees and terms with credit card issuers, banks or other financial institutions directly.
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This article originally appeared on Credit.com.