Q: For someone who is Market America distributor (which is a multi-level marketing business similar to Amway) would you recommend applying for their branded Platinum MasterCard? It lets you earn commissions when you use it for product purchases, transfer buys, convention tickets, etc. Is it a good idea?
A: From my review of it, there appears to be almost no logical reason for getting a credit card from Market America. I say this because of these 3 things…
1. The commissions (rewards) are confusing and lousy
First of all let me start out by saying I am not the biggest fan of Market America and similar programs.
I haven’t used them myself, but I have a former roommate who – over the period of 5 or so years we shared the same apartment – I saw him lose a lot of time and money participating in MLM and similar type programs, one after another. To be clear, he did not participate in Market America to the best of my knowledge so the preceding statement is not about them.
I just say this upfront to be transparent with you that I have a bit of a bias against these types of companies. If you’re going to participate in these types of things, I would HIGHLY ADVISE against using a credit card to go into debt to pay for the expenses involved.
Only use a credit card if you pay your balance in full. It’s hard enough to succeed in this industry and it will be even harder to make a profit if you are paying interest on debt that was incurred from it.
With that disclosure out of the way – biased or not – I do not see how the Market America credit card would be beneficial for most people. The rewards are as follows:
- Earn 1 percent back on all purchases in the form of IBVs
If you are part of Market America you will know better than me how much one IBV (incentive business volume) is actually worth. I’ve done quite a bit of Googling around and still don’t understand the exact answer.
But if and I reiterate that’s an if since I don’t know for sure, each IBV is worth about 1 cent, then this credit card is basically earning around 1% in rewards. Would that be worth it in my opinion? Definitely not.
Here are business cards that give up to 5% cash back. Sure I advertise them, but even if I was a Market America distributor, I would rather get one of those that has better rewards.
2. The APR can be quite high
When I pulled up the card application, the interest rate was listed as being 13.99% or 24.99%.
Since it says “or” and not “between” it seems you probably get stuck with one or the other and no in-between rate.
If you got stuck with the 24.99% that is incredibly high for a major credit card to have. I expect to see rates like that on department store and gas station cards, but not a MasterCard from a major issuer like Barclays.
If you don’t make your card payments in full every month, the 24.99% rate is far too much to pay in my opinion.
3. The benefits are limited
As you probably have seen, the Market America MasterCard is a “platinum” tier card. I know a decade or two ago platinum actually meant something, but these days it’s actually no longer the top tier.
World MasterCard and Visa Signature are the highest tier credit cards that come with more benefits. If you get a Platinum MasterCard or Visa, you’re getting fewer perks.
Like I said, setting aside my admitted bias, I see little reason to apply for a Market America credit card. From my understanding of the rewards (or what the application refers to as commissions) and benefits are nothing to write home about. Sure there’s no annual fee, but the same can be said about hundreds of other cards, too.
But more importantly, please be careful with these types companies. Yes it is possible to make money, but very few make livable wages from them. In Canada companies such as this are required to disclose how much distributors make per year. Although it is now a few years old, I came across one of these compensation disclosures (source found here) for Market America which allegedly showed that 51.38% of Canadian distributors purportedly received between $1 and $1,195 in annual earnings.
I reiterate the above is for Canadian distributors (not those in the US, where these figures don’t have to be disclosed). The takeaway is that you can make money, but due to the small percentage of participants that earn a livable income, it’s important to not go into debt and overspend on inventory, training and other expenses involved if you choose to participate in this and/or similar businesses. Of course, comments agreeing or disagreeing with me are welcome below. I respect all viewpoints, even those who disagree with me.
This article was written or last updated May 2013