Last Updated on August 29, 2019 by Bakari Chavanu
Most people reading my blog site know about the Apple Card already, so instead of describing the details of what it is and how it works, this articles explains why I signed up and how I’m using the Apple Card.
The Apple Card is my fourth credit card. I started using credit cards again after a period of mismanaging a few cards in the past. Plus, for several years I got used to not using a credit card at all.
But a few years ago, I started seeing the perks of responsibly using credit cards instead of debit cards. Though there are several other competitive credit cards out there, I think the Apple Card is still useful.
Why I Got the Apple Card
Because I try to be frugal with my spending, I didn't necessarily need another credit card. In addition to the Apple Card, I have three other cards: the Capitol Spark Business card, the Citibank BestBuy card, and the Capitol One QuickSilver which I allowed my son to cosign onto.
I decided to sign up for the Apple Card for the following reasons:
- The 2% cash back reward using Apple Pay
- The ease of using the Apple Wallet and the features inside the Apple Card app.
- Because it’s easy to tap and pay the monthly credit balance.
- Because I think the card app features will improve over time.
- And because I’m a long-time Apple user.
Side note: as with any other credit card, after you apply for the Apple Card, the application makes a hard pull on your credit report, which in turn can mean a temporary decrease or increase on your credit score. After I was approved, my score decreased 3 points on the Transunion score, but it increased by 4 points on the Equifax. I haven’t checked my FICO score. But the change in score should be temporary if you pay your monthly balance(s).
2% Cash-back Reward
The most important benefit of using any credit card are the cash-back rewards. This year I received $500 sign up bonus from the Spark Business Card, and as of this writing my cash-back reward balance is an additional $94.72 on that card. By the end of the year I will probably earn more in cash rewards than APY interests on my savings account balance.
However, Spark card only pays 1.5%, whereas the Apple Card pays 2% using Apple Pay. That extra 5% was enough of an incentive to sign up for the Apple Card, because with enough spending, it puts money back in my budget and cash flow.
Apple Pay is available at many places where I shop, and the payment option is also available online. If you use Apple Pay online, you also get the 2% cash-back. And when you purchase directly from Apple or via the iTunes Store (including music, apps, books, songs), you get 3% cash-back.
However, for those who like to maximize the use of credit cards, the Apple Card is not nearly the best deal in town, because it doesn’t offer a sign-up bonus, and when you use the physical titanium Apple Card, you only get back 1% in cash-back.
Nonetheless, I like how Apple’s cash reward goes directly to my Cash Card in my Apple Wallet, which also makes the balance visibly accessible. With many other cards, the cash award can only be applied to credit card balance or two other purchases, and some credit card companies don’t apply your cash-back until the end of the month.
Personally I like my cash-back rewards to build up for a while before I retrieve them. With the Apple Cash, you’ll notice that Apple invites users to connect their Cash Card to iTunes to buy apps, movies, TV shows, books, etc. So they effectively get the money back. Nevertheless, users could still benefit financially in that regard.
Apple Card App Features
I particularly like Apple Wallet and the features of the Apple Card app.
About seven years ago, I stopped carrying a separate wallet, instead use the Distil Union Wally Case for four of my last iPhones. I carry two credit cards and my driver’s license in the case, but I’d prefer not to carry physical cards with me at all.
I much prefer to have my cards in the Apple Wallet for sheer convenience of accessing and using them. Most of the places I regularly shop provide Apple Pay, and I’m starting to see online stores adding Apple Pay buttons to their checkouts. Last night I used Apple Pay the JetBlue website. Interestingly I had to approve the transactions using my iPhone.
Also, I’ve read that the Apple Card provides better security, because Apple assigns a specific card number on your phone for your transactions using Apple Pay. And as you probably already know, the physical Apple Card doesn’t have your card number on it, or any other information except your name.
The Apple Card app contains a few useful features for monitoring and budgeting your spending. The card app will categorize your purchases so that you can see for example how much you’ve spent on fast food. However, because the app doesn’t allow for changing a transaction to a different category, or to even set budget goals for spending categories, it’s not now as useful as it could be in this regard.
Note: one of the reasons I’m able to responsibly use credit cards is because I’ve been using YouNeedABudget (affiliate link) for the last four years, and it has made a huge difference in how I manage my monthly and annual expenses, and achieve my savings goals. With YNAB, I keep a two-month buffer on my monthly expenses, and most importantly, the app helps me budget for annual expenses and goals. I don’t think the Apple Card app will ever be able to replace YNAB or Mint.com, mainly because it only monitors a single financial service, the Apple Card.
In this regard, it’s also disappointing that the Apple Card doesn’t have a web portal that supports connecting your Apple Card account with YNAB, Mint, Quicken, and other financial services. This is a serious flaw that will cause me not to rely solely on the Apple Card because it means I have to manually input Apple Card transactions into my YNAB account instead of them being automatically downloaded.
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Charging and Making Payments
One of the key ways I get the most out of my credit cards is to use them like debit cards. I never charge anything to my cards that I don’t have money in my checking account to immediately cover.
And because I budget with YNAB, I always know how much money I have available for various categories of spending. I pay off my credit card balances once or twice a month, depending on the balances.
Apple makes it super easy to make monthly payments. Simply connect your checking account to your card, and it’s a one or two-tap process for making a payment. On top of of that, you can set up automatic payments inside the app to make sure you don’t miss the due date, which is conveniently at the end of the month.
The app also includes a graphic interface that shows the interest charges you will pay if you don’t pay off the total balance. I don’t plan to ever use that feature, but it’s great for those who need it.
The Titanium Card
As cool as the titanium Apple Card is, I don’t plan on using it. Using the physical card means only getting 1% cash back, which is definitely not competitive with other credit card offers.
For some people the titanium card may be a status symbol, for at least a while, doesn’t make sense using it if you carry your iPhone or Apple Watch everywhere you go. Leave the physical card in your car, book bag, or purse and use it only when you have to.
Credit Card Advice
If the Apple Card is your first credit card, or if you’re still learning to effectively use and manage a credit card, here’s some advice:
- Use the Apple Card like a debit card. Use Apple Pay whenever possible to get the 2% cash-back. But only charge what you have in your checking account to cover. And pay off your balance every month, or if your balance gets over 30% of your total available limit, pay off that balance the due date.
- If you already have debt on one or more credit cards, don’t run over your limit on your Apple Card. Don’t incur interest charges, especially when it comes to buying expensive items like a new Mac or iPhone. Save up for larger purchases so you don’t incur money sucking interest charges.
- See if your bank includes a feature sending your daily checking account balance so that you’ll always know how much you have in the bank.
- Set up a budget to keep track of your spending. If keeping a budget is too tedious, then at least determine how much money you have available to spend for the month after your fixed and required expenses are paid for. Make sure you Apple Card doesn’t go beyond the budget you determine.
- Let your Apple Cash build up for something you really want. Don’t use it every time there’s a dollar or two on the card.
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