Diamond status: Which credit card should I use to buy an engagement ring?
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Fun fact: Valentine’s Day is one of the most popular days of the year to get engaged, according to WeddingWire. If you’re among those who have decided to pop the question on Feb. 14, you may already have a ring in mind.
But did you ask the most important question: How will you actually pay for the ring? According to The Knot’s 2020 Jewelry and Engagement Study, the average engagement ring costs $5,500. Understandably, you’ll want to maximize a big purchase like this with the right credit card.
So what is the best way to pay for it with a credit card? Well, let’s look at three different scenarios:
- If you want to pay off the ring purchase over time: Look for cards with the best introductory APR offer
- If you want to hit a sign-up bonus for a large influx of points: Look for the best sign-up bonus or welcome offer
- If you’re unsure what type of card will get you the best return value: Compare points vs. cash-back cards
Here are some suggestions based on each.
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Best intro APR offer: American Express Cash Magnet® Card
Annual fee: $0 (see rates and fees)
Rewards on your engagement ring: Earn an unlimited 1.5% cash back on all purchases.
Why we chose it: With the Amex Cash Magnet Card, you’ll get 0% intro APR (see rates and fees) for the first 15 months on new purchases starting when you open your account (13.99%-23.99% variable APR after) (see rates and fees).
With the average engagement ring costing $5,500, you’d need to pay at least $367 a month to pay that off over 15 months without interest with this card. The best part is that you’ll also get 1.5% back in cash-back rewards (around $80 for a $5,500 ring purchase).
Learn more: Amex Cash Magnet Card review
Other options: If you’re more interested in a longer intro APR period than earning rewards, consider the U.S. Bank Visa® Platinum Card. You’ll get 0% intro APR for 20 billing cycles, which is an industry high on new purchases right now (although there is a 15.99%-25.99% variable APR after the intro period ends). The Citi® Diamond Preferred® Card is another option, it offers a 0% Intro APR for 21 months on balance transfers from date of first transfer and 0% Intro APR for 12 months on purchases from date of account opening, then a variable APR of 15.24% – 25.24%, based on your creditworthiness. (balance transfers must be completed within the first four months of account opening); then a 15.24%-25.24% variable APR applies). Both cards come with no annual fee, but you also won’t earn rewards on your purchase.
The information for the Amex Cash Magnet has been collected independently by The Points Guy. The card details on this page have not been reviewed or provided by the card issuer.
Best introductory spending bonus: The Platinum Card® from American Express
Annual fee: $695 (see rates and fees)
Rewards on your engagement ring: Earn 100,000 Membership Rewards® Points after you spend $6,000 on purchases on the card in your first 6 months of card membership.
Why we chose it: The Amex Platinum card has a welcome bonus offer of 100,000 Membership Rewards points, but it’s possible to get targeted for a much bigger bonus. Through CardMatch you can get an offer as high as 125,000 Membership Rewards points after meeting minimum spend requirements (offer subject to change at any time). This increased offer is targeted, so it won’t be available for everyone. But if you are eligible for it, you won’t find a better consumer card offer.
Not only does the Amex Platinum have a healthy bonus, but it earns Amex Membership Rewards points, which are some of the most valuable transferable rewards you can earn. Amex points transfer to 16 airline and hotel partners, so you’ll have plenty of options for booking a honeymoon on points. And the Amex Platinum card is loaded with top-tier benefits that upgrade a honeymoon, such as airport lounge access, hotel elite status and airline fee credits. Once you’ve opened the card, be sure to check out our guide to maximizing the Amex Platinum’s benefits.
One of the most useful Amex Platinum benefits in this situation is the card’s purchase protection. With it, you’ll be covered for damage and theft for 90 days from the date of purchase. You can be reimbursed for the amount charged to the card, for up to a maximum of $10,000 per incident ($50,000 max per account per calendar year). Enrollment required for select benefits.
Learn more: Amex Platinum Card review
Other options: If the Amex Platinum card’s annual fee is too much for you to swallow, then the Chase Sapphire Preferred Card is a great alternative. It has a sign-up bonus of 60,000 bonus points after you spend $4,000 in the first three months from account opening. It come with only a $95 annual fee. While the Sapphire Preferred doesn’t come with all the perks of the Amex Platinum, the intro offer is still valuable. Chase Ultimate Rewards points transfer to 13 airlines and hotels, including Hyatt, Southwest and United Airlines.
The Chase Sapphire Preferred does have a purchase protection benefit which covers theft or damage to eligible items purchased with your card in the past 120 days. But you’ll only be reimbursed for up to $500 per claim. That’s not nothing, but it’s not going to come close to covering the full price of the ring.
Best for earning points or cash back: Chase Freedom Unlimited
Annual fee: $0
Rewards on your engagement ring: Earn 1.5% cash back on non-bonus spending.
Why we chose it: You’re about to make a large purchase, so it’s only natural to want to earn the most points or cash back possible. Unfortunately, most merchants from which you’d purchase an engagement ring won’t code as a merchant type that’ll earn a category bonus on most cards. So you’ll likely want to use a card that’s good for everyday spending. My top consumer card pick for purchasing an engagement ring would be the Chase Freedom Unlimited. The Freedom Unlimited will earn 1.5% cash back on your ring purchase, but those rewards can turn into full-fledged Ultimate Rewards points if you also have a Chase Ultimate Rewards earning card like the Chase Sapphire Reserve or Chase Sapphire Preferred Card. Based on TPG’s valuations, this means you could get a 3% return on your purchase.
The Freedom Unlimited does offer 0% intro APR on purchases and balance transfers for the first 15 months your account is open. Although this can give you additional time to pay off your purchase, the APR will jump to a variable 15.74%-24.49% based on your creditworthiness once the first 15 months are over. This card will also provide some shopping protections for purchases made with your card. Items you purchase that have a manufacturer’s warranty of three years or less will be covered by an extra year of extended warranty protection for up to $10,000 per claim. You’ll also be protected against theft or damage to your purchases within the first 120 days, but only for up to $500 per item.
Learn more: Chase Freedom Unlimited card review
Other options: If you’re looking for cash back, another option is the Citi® Double Cash Card, which earns up to 2% (1% when you buy and 1% when you pay your bill) on all purchases. It doesn’t come with an introductory purchase APR offer, a sign-up bonus or purchase protections like the Chase Freedom Unlimited, but it doesn’t charge an annual fee and comes with a better cash-back return if you don’t have another Chase card to pair with the CFU.
For those interested in a stand-alone travel credit card, the Capital One Venture Rewards Credit Card is another choice that earns 2x miles on every purchase (including your engagement ring). While the card does come with a $95 annual fee, you’ll also get a solid sign-up bonus, extended warranty protection, purchase protection and the flexibility to redeem miles as a statement credit for travel or by transferring to partners.
Now that you know your credit card options to cover the cost of the engagement ring, The Knot offered factors to consider on how much to spend. First, figure out if you’ll be comfortable handling the monthly payments for the ring. It’s a good idea to look at your bills and income to see if you can fit a ring credit card payment into your budget. Remember — if there’s a wedding ahead, you want to factor in spending for that too.
Second, you want to get your partner the ring of their dreams. But there needs to be a balance between finding a ring they’ll love and feel proud of — and also one that fits the budget. If it’s not a surprise, go shopping together. If it is a surprise, get help from friends and family who know them well and ask for help. Once all that’s done, you can get married and have your happily ever after.
Featured image by Yakobchuk Viacheslav/Shutterstock.
For the rates and fees of The Platinum Card from American Express, click here.
For rates and fees of the American Express Cash Magnet, please click here.
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