Should you consider a charge card?

By Ismat Sarah Mangla


(Money Magazine) -- If you haven't yet gotten a solicitation for a charge card (which, unlike a credit card, requires you to pay in full every month), you probably will soon.

In an effort to limit risk, banks have tripled direct-mail offerings for charge cards since 2007.

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American Express recently launched Zync, a card aimed at folks in their twenties and thirties.

Chase, which now has a charge card for small businesses, will probably introduce some for individuals soon, says Anuj Shahani of market research firm Synovate.

Charge cards generally make sense only if you're a big spender; they tend to offer richer rewards than credit cards do, says industry expert Curtis Arnold.

With AmEx, you earn one point for virtually every dollar spent on most purchases (double points for certain categories), plus get high-end concierge services that give you access to exclusive events, restaurants, travel discounts, and more.

The downside? Charge cards typically come with hefty annual fees -- AmEx's range from $25 to $450.

So do the math on whether the value of those perks will outweigh the costs.  To top of page

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