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Alternative options for holiday purchase financing: My Chase Plan vs. Amex Pay It Plan It

Nov. 25, 2021
12 min read
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According to the Apple Pay Holiday Shopping survey conducted by Morning Consult for Apple, 47% of Americans haven't done any holiday shopping yet, and about 23% have just started shopping for this year's season — so the next few weeks look like they'll be pretty busy for consumers.

Now more than ever, flexible financing options are important for a lot of folks. As we head into the holiday season, many cardholders might be wondering how they can responsibly finance holiday-related expenses like shopping and travel without getting into trouble or hardship.

In recent years, credit card issuers have taken steps to make financing purchases a simpler process — and one without the worry of interest payments or other hidden charges. Amex, for instance, offers a Pay It® Plan It® financing option across a number of cards, and Chase has a similar financing option called My Chase Plan.

Both options allow cardholders who make eligible purchases of more than $100 to spread out the cost by paying over the course of several months. When you take advantage of one of these options, rather than getting charged interest on those purchases -- which would grow over time the longer you put off paying -- you’re charged a fixed monthly fee. Of course, you’ll still earn rewards on those purchases, too (just on the original purchase amount, though). Just remember, though, that opting for one of these plans can affect your credit since the amount you owe accounts for 30% of your FICO score.

While not for everyone, Amex's and Chase's payment plans can help you pay off purchases (or other unexpected expenses) over time without a major financial penalty. Here's how they work.

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Amex Pay It Plan It overview

Amex’s Pay It Plan It gives cardholders two additional ways to pay off purchases.

Pay It, which is available only through the Amex app for your eligible account, gives you the option to pay off smaller purchase amounts throughout the month rather than waiting until your billing cycle is over to pay for all of your monthly purchases at once. You can make the payment equal to the amount of a billed purchase of less than $100. The payment isn't actually applied to that specific purchase, but rather to your total outstanding balance.

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Among the reasons you might want to go this route is if you are getting close to reaching your credit limit on a card but want to continue using it for purchases in a given month. You also might want to use Pay It to keep your balance low over the course of the month so that unusually large expenses don't have an outsize, even if temporary, impact on your credit score. You can make up to five Pay It payments per day.

Plan It, on the other hand, provides a financing option that lets you split qualifying purchases of more than $100 into monthly payments with a fixed fee rather than a variable annual percentage rate.

With Amex Plan It, you can have up to 10 active plans at a time. Based on the size of the eligible purchase you’re creating a payment plan for, you’ll have up to three different options to choose from. The longer the payment term, the higher the fixed fee. Enrollment is not required.

Here is an example of a Plan It option on one of my recent eligible purchases on my Delta SkyMiles® Reserve American Express Card:

(Screenshot courtesy of American Express)

Some American Express cardholders (including myself) are currently eligible for a $0 Plan It intro fee through Dec. 31, 2021, no matter if I choose the 12-, 18- or 24-month plan. This is a terrific option if you need to finance a large purchase this holiday season, since you'll save big on monthly plan fees. After Dec. 31, there will be a fixed monthly fee based on my cardmember agreement that will apply.

In my example and without the current offer in place, financing a charge of $1,000 would cost me between $97.32-$191.28 depending on how long I took to pay it off. While not stellar, those numbers still represent significant savings over interest fees and late charges.

Additionally, new cardholders of the following Amex cards can get a $0 fees introductory offer for Plan It. After the defined introductory period, a variable purchase APR of 15.49% to 25.49% and a plan fee of up to 1.33% of each purchase will apply. Here are a few of the cards currently extending such offers:

  • Blue Cash Everyday® Card from American Express (15-month intro offer, see rates and fees).
  • Blue Cash Preferred® Card from American Express (12-month intro offer, see rates and fees).
  • American Express Cash Magnet® Card (15-month intro offer, see rates and fees).

The information for the Amex Cash Magnet Card has been collected independently by The Points Guy. The card details on this page have not been reviewed or provided by the card issuer.

Eligible cardholders can set up a plan through the app or on desktop by clicking into a specific transaction that is eligible for Plan It and then selecting the Plan It option. Here is the full FAQ on Amex's Pay It Plan It feature.

My Chase Plan overview

My Chase Plan operates similarly to Amex’s Plan It feature. On applicable purchases of more than $100, eligible cardholders can pay off purchases over multiple months and instead of being charged interest on their balance, they'll be charged a fixed fee to do so. Just like with Amex, you can have up to 10 active plans at once. But Chase offers plans anywhere from three to 18 months, which is a shorter time frame than Amex.

Both in the app and on desktop, the "My Chase Plan” option will pop up on your account activity page next to eligible purchases. Here is an example of a My Chase Plan option on one of my recent eligible purchases with my Chase Sapphire Preferred Card:

(Screenshot courtesy of Chase)

Notice that like Amex, the fixed fee is larger each month when you choose a longer payment plan. In this particular example, I'd be paying a monthly fee of $0.73-$0.82, depending on the duration of the plan, which is very reasonable considering interest charges would be much, much higher than that.

Click here to read the FAQ on My Chase Plan.

Comparing both options

The two financing options are incredibly similar in terms of how they work and ease of use. They also both offer a calculator tool that helps you determine potential payment plan options for different purchases. I went through each and looked at what plans could be available at four different price points to see which offered better fees and plan lengths.

Amex Plan It

Here’s a quick snapshot of how much using the Plan It feature would theoretically cost you in total fixed fees at each payment plan level based on Amex’s Plan It calculator**:

Initial purchase6 months12 months18 months: 

** This chart depicts the amount in fixed fees you would theoretically pay over the course of the payment plans, not what your monthly payment would be.

For example, a $500 purchase that you decide to pay out over the course of six months would be broken down into monthly payments of $87.49, with a monthly fee of $4.15. So over the course of the six-month payment plan, you’ll end up paying a total of $524.90 for the total purchase. Over a 12-month plan, you'd pay $50.16 in fees, which is around 10% of the purchase price, but still far less than your APR would likely be.

Keep in mind that these numbers are just an estimate that Amex provides to help you plan out larger purchases. The actual plans offered once you make a purchase might be a little different based on a number of factors. However, this gives you an idea of how much using this plan would cost you in fees, and the calculator gives you a better look at how much you’d have to pay each month.

Related: How to choose the best Amex card for you

My Chase Plan

By comparison, here are the fees that Chase’s calculator estimates you’d pay across payment plans for those same purchases (keep in mind that this is based on my Chase Sapphire Preferred credit card account, so your estimates might be different if you use the calculator on your own):

Initial purchase3 months6 months9 months12 months18 months

** This chart depicts the amount in fixed fees you would theoretically pay over the course of the payment plans, not what your monthly payment would be.

With Chase, a $500 purchase that you decide to pay out over the course of six months would cost $85.96 per month, which includes a $2.62 monthly fee. You’d end up paying a total of $515.72 by the end of the plan.

Chase seems to be charging lower fees across plan options, but keep in mind that Chase offers shorter maximum payment plan options. For example, you’ll only have 18 months at maximum to pay off a $5,000 purchase, but you could have 24 months with Amex.

Related: Maximizing the Chase Trifecta

Are these financing options worth it?

Whether you should use one of these financing options depends on your specific situation.

Obviously, if you can afford to pay off a purchase on time and in full, and thus avoid both interest payments and fees, that option makes the most sense. However, for large purchases where you know you won’t be able to pay off the balance in full, these financing plans can save you money versus paying interest on your balance

Sticking with the $500 purchase example from above, it would cost you about $29 in interest at Chase’s highest possible APR for the Chase Sapphire Preferred (16.24% to 23.24%, based on your creditworthiness) to pay off that purchase over the course of three months. If you took six months, the interest cost would go up to about $58. If you took nine, the cost would go up to $87.15. That's compared to the $7.44, $15.72 or $25.02 in fees you would pay at those month marks, respectively, if you chose the My Chase Plan option. So you’d definitely be saving money by using this financing option.

Granted, there is a third option to choose from when planning out larger purchases — a 0% APR credit card. Many of the top cash-back credit cards offer an introductory period from 12 to 18 months where you can pay off new purchases with a 0% APR (though a variable APR will apply to your balance once that intro period is over). For those really large purchases — new kitchen appliances, for example — a 0% APR card might be the better way to go if you’re looking to use credit cards to finance. Just remember that the amount you owe accounts for a huge element of your credit score, so it's never a really great idea to carry a balance longer than you need to at the risk of lowering your overall credit score.

Related: Expenses you shouldn’t put on your credit card

Bottom line

Whether you’re planning for upcoming holiday spending, making renovations to your house or needing a way to pay off everyday expenses such as your grocery bill over time, Chase's and Amex’s new financing options can help you plan out payments. These features shouldn’t be used when you can help it, but they do offer a compelling alternative to high interest rates.

In general, Chase is currently offering better fee rates on their My Chase Plan financing options, but Amex gives you longer to pay off purchases for those who need 18- and 24-month plans for some expenses.

For rates and fees of the Blue Cash Everyday, click here.
For rates and fees of the Blue Cash Preferred, click here.
For rates and fees of the Amex Cash Magnet, click here.

Additional reporting by Stella Shon.

Featured image by POIKE/GETTY IMAGES
Editorial disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airline or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.