Many consider charge cards a smarter choice for avoiding debt (compared to credit cards) because you can't use them to accumulate interest-bearing debt (there's no such thing as "paying the minimum" with charge cards). But which are the best charge cards in terms of rewards and benefits? First, let's look at what makes charge cards distinctive:
  • Your monthly bill must be paid in full. That means you can't run up long-term debt like you can with credit cards. Your entire balance is due on the due date, meaning you can't roll debt over into the next payment period in exchange for paying interest. This introduces actual discipline into the equation: If you can't afford to pay for something, don't buy it with a charge card. Think of it more as a convenient way to make purchases or a vehicle for earning rewards than as a borrowing tool.
  • There is no interest charged as long as you pay your bill on time. If you pay late, there is a penalty fee rather than an interest charge.
  • Charge cards offer benefits that you won't always find on credit cards, including generous purchase and travel protections and roadside assistance.
  • An annual fee is always required, since the issuing bank is not making any revenue from interest charges.
  • You often have a high credit limit or no preset credit limit (i.e., a dynamic credit line that adjusts to your monthly spending needs). That doesn't mean you can just charge however much you want – your issuer will be monitoring your purchasing and payment habits to determine how high it will let you go. If you make a huge purchase that's out of the norm, it may be declined.
American Express, a CreditCardForum advertising partner, is the pioneer in this field and is by far the largest issuer of charge cards in the United States. Some of the most well-known charge cards are issued by AmEx – the Green Card, the Gold Card, the Premier Rewards Gold Card and the Platinum Card. Their benefits include several types of complimentary insurance coverage, comprehensive expense tracking, higher rewards and excellent customer service.

Which are recommended for 2014?
So, which charge cards should a savvy consumer consider? The Premier Rewards Gold Card and the Platinum Card from American Express are popular choices according to feedback gathered on the forum. These two cards have long been known for delivering an array of travel and entertainment benefits along with favorable customer reviews.

Here are just a few of the benefits that both cards have in common:
  • Membership Rewards Program - The charge cards from AmEx earn "Membership Rewards" points, which have the potential of being more valuable than your typical credit card reward points. Why? Because you can transfer Membership Rewards points to more than 20 hotel and airline loyalty programs. Best of all, your points' value usually doesn't have to get diluted during the transfer – you often get 1 mile or 1 hotel point in exchange for each Membership Rewards point, with a few exceptions. The Membership Rewards program has a bunch of other redemption options, too, including merchandise and statement credits. Keep in mind, the value of your points will vary, depending on how you redeem them.
  • Purchase Protection Benefit: This covers your qualifying new purchases for the first 90 days if something happens to them – if they're stolen or accidentally broken, for example.
  • Extended Warranty Benefit - You get up to one year of extra coverage if you buy a qualifying item that has a manufacturer's warranty of five years or less. So if you bought an eligible computer with a one year warranty, you could get up to one additional year of coverage for free.
  • Roadside Assistance – If you have the Premier Rewards Gold or Platinum, you can call for roadside assistance up to four times per year for services including towing (up to 10 miles), flit tire changes (assuming you have a spare), jumpstarts and more.
#1 Recommendation: For this card, the membership fee is now waived the first year. Of the two cards mentioned above, it also offers higher rewards on both gasoline and supermarket purchases.
#2 Recommendation: The $450 fee may not be justifiable for many people, and the rewards-earning rate is on the low side (1 point per dollar). But if you are a frequent traveler (especially if you are a road warrior business traveler) you might get a lot out of the card's perks, especially if you like to stay at high-end hotels and enjoy airline lounge access before and between flights.
What's the recommended offer if you still want a credit card?
Although not a charge card, this credit card has a reasonable annual fee given its benefits. I have received positive feedback from people newer to credit or who have less impressive credit histories (and who were approved). So it can be a good choice for your first American Express card. It probably only makes sense if you live in a market serviced by Delta Airlines, though.

Are there any other charge cards available?
Yes – and even though they aren't generally considered to be the top charge cards on the market, for some consumers they might be an appropriate choice:

Diners Club Given the annual fee of $95 (or more) per year and the less-than-flattering customer service reviews lately, it doesn't make sense to choose this over AmEx. In fact, Diners Club is a bad choice for 2014 in my opinion.
AmEx Green Card - While it's true this is a good starter card (and possibly a foot in the door with AmEx), the annual fee still $95. That makes it more than half the cost of the Premier Rewards Gold card, which has bonus categories that help you earn more rewards per dollar spent and comes with a bunch of other perks. So consider that before you go for the Green card.
Chase Ink Bold - A good card, but it's only for business. It has a $95 annual fee.


Editorial Disclosure: The editorial content on this page is not provided by any bank, credit card issuer, airline or hotel chain, and has not been reviewed, approved or otherwise endorsed by any of these entities. Opinions expressed here are authorís alone, not those of the bank, credit card issuer, airline or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.