Credit card rewards are often about quick gratification – a free flight, a free night in a hotel, a statement credit or a new blender.
Investment credit cards from brokerage firms, however, provide another possibility – using your rewards to invest in your retirement, your child’s college education or another long-term savings goal.
Brokerage card basics
Brokerage-firm credit cards differ, but in general, you can expect the following:
- You must be a client to apply: An eligible brokerage or savings account is often a prerequisite for these cards. Some firms even limit your eligibility to certain types of investment accounts.
- Some cards require you to deposit rewards into the firm’s accounts: Some brokerage-firm accounts advertise themselves as “cash-back” cards. But these are not mainstream cash-back cards, which allow deposits into any bank account, or even a statement credit. Instead, you must generally deposit your “cash back” into an eligible investment account with the firm that issued the credit card.
A notable exception to this are firms offering co-branded American Express Platinum cards (American Express is a CreditCardForum advertising partner). With these co-branded cards, you generally have the option of redeeming for Membership Rewards points (in American Express’s incredibly flexible rewards program) OR deposits into investment accounts.
- You may get a higher per-point value: Some brokerage cards offer cash-back values that are higher than those on most mainstream cards. They also often give you additional bonus rewards if you spend a certain amount, or a redemption bonus if you make large enough deposits. This helps make up for the lack of flexibility compared to mainstream cash-back cards.
Available investment credit cards
Ameriprise World MasterCard (no annual fee): You’ll earn 1X Ameriprise Rewards point for every dollar spent on purchases. The Ameriprise Rewards program allows you to redeem into an eligible Ameriprise account, or for gift cards, travel and more. Points can also be earned by performing certain actions, such as making $50,000 deposits into eligible accounts or completing a home or auto insurance quote.
Your points are worth 1.25 percent cash back when you redeem in increments of 30,000 into eligible Ameriprise accounts.
Ameriprise Financial World Elite MasterCard ($150 annual fee): The upgrade to the World MasterCard version (see above), this card gets you a 1.5 percent cash-back value when you redeem into an eligible financial account (in 30,000-point increments). You also get up to $200 in statement credits toward airline purchases if you spend $36,000 on the card in a year.
American Express Platinum Card for Ameriprise ($450 annual fee, increasing to $550 but waived the first year): This card is noteworthy, in that it waives the annual fee for the first year. You get all the regular Platinum benefits, plus an additional 5,000 Membership Rewards points for every $20,000 in purchases (up to an additional 30,000 points per year).
Schwab Investor Card from American Express (no annual fee): This is a cash-back rewards card that earns an unlimited 1.5 percent cash back on all eligible purchases (which is then automatically deposited into an eligible Schwab account).
American Express Platinum Card for Schwab ($450 annual fee, increasing to $550): This is pretty much the American Express Platinum card as you know it, but for Charles Schwab clients only. The major differences are (1) you earn an “Appreciation Bonus” every year (either $100 or $200, depending on the size of your Schwab holdings) and (2) you get to choose whether you earn Membership Rewards with the card or deposit rewards into your Schwab account ($10,000 = a $125 deposit).
Fidelity Rewards Visa Signature Card (no annual fee): Get an unlimited 2 percent cash back on everything. You can deposit your rewards into one or several of your eligible Fidelity accounts (brokerage account, Fidelity Cash Management Account, Fidelity-managed 529 College Savings plan, retirement account or Fidelity Go account).
Platinum Card from American Express for Goldman Sachs ($450 annual fee, increasing to $550): The benefits are basically identical to those of the regular Platinum card from American Express. However, in addition, you also get an annual bonus of 40,000 Membership Rewards points if you spend $100,000 on the card that year.
Morgan Stanley Credit Card from American Express (no annual fee): This card earns 2X Membership Rewards on airfare purchased directly from airlines, dining at U.S. restaurants, purchases at select department stores and car rentals from select companies. All other purchases earn 1X. You can redeem for all the things Membership Rewards can be redeemed for, or invest them with deposits into an eligible Morgan Stanley brokerage account (1,000 points = a $100 deposit).
You also get an “Anniversary Spend Award” of $100 if you spend $25,000 on the card each year.
Platinum Card from American Express for Morgan Stanley ($450 annual fee, increasing to $550): This card has the same perks as the regular Platinum Card from American Express. In addition, it also offers a $500 Anniversary Spend Award (if you charge at least $100,000 to your card in a given year).