Let’s compare the American Express Essential Credit Card and the BMO Preferred Rate Mastercard to help you make an informed decision. We’ll evaluate them based on interest rates, fees, rewards and benefits, and additional perks.
1. Interest Rates
- American Express Essential Credit Card:
- Pros:
- 12.99% interest rate on purchases and cash advances, which is lower than many other cards.
- Cons:
- No introductory offers for balance transfers or special promotional rates.
- Pros:
- BMO Preferred Rate Mastercard:
- Pros:
- 13.99% interest rate on purchases, which is slightly higher but still competitive.
- 0.99% introductory rate on balance transfers for the first 9 months, with a 2% transfer fee.
- Cons:
- Cash advances carry a higher rate of 16.99%.
- Pros:
Winner: American Express Essential Credit Card
The American Express Essential Credit Card wins this category due to its consistently low interest rate on both purchases and cash advances. However, if you’re specifically looking to transfer a balance, the BMO card’s introductory rate could be more appealing.
2. Fees
- American Express Essential Credit Card:
- Pros:
- No annual fee.
- No over-limit fees and no foreign transaction fees, which can be a big plus for frequent travelers.
- Cons:
- Standard late payment fees apply, which can be steep depending on your balance.
- Pros:
- BMO Preferred Rate Mastercard:
- Pros:
- Low annual fee of $29.
- Cons:
- A 2.5% foreign transaction fee applies, which can add up if you often make purchases in foreign currencies.
- An additional $29 fee for adding an authorized user.
- Pros:
Winner: American Express Essential Credit Card
The American Express Essential Credit Card is the clear winner here with its zero annual fee and no foreign transaction fees, making it a cost-effective option for budget-conscious users.
3. Rewards and Benefits
- American Express Essential Credit Card:
- Pros:
- Offers purchase protection and extended warranty coverage.
- Access to American Express Invites, which includes special events and offers.
- Cons:
- No rewards program for earning points or cashback, which might be a drawback for those who want to earn while they spend.
- Pros:
- BMO Preferred Rate Mastercard:
- Pros:
- Provides purchase protection and extended warranty similar to American Express.
- Cons:
- Also lacks a rewards program, meaning no points or cashback on your purchases.
- Pros:
Winner: Tie
Both cards offer similar basic benefits in terms of purchase protection and extended warranty. Neither card provides a rewards program, so this category is a tie.
4. Additional Perks
- American Express Essential Credit Card:
- Pros:
- American Express Experiences, which offers access to exclusive events, ticket pre-sales, and special offers.
- Cons:
- Limited acceptance compared to Mastercard, especially outside major urban centers and internationally.
- Pros:
- BMO Preferred Rate Mastercard:
- Pros:
- Wider acceptance globally, making it a more versatile card for international use.
- Cons:
- Lacks unique perks beyond the standard benefits.
- Pros:
Winner: American Express Essential Credit Card
American Express wins here due to the unique experiences and events it offers cardholders, though BMO’s wider acceptance may be more practical for those who travel frequently.
Overall Verdict
Both the American Express Essential Credit Card and the BMO Preferred Rate Mastercard offer compelling benefits, particularly for those who prioritize low interest rates and essential benefits without the frills of rewards programs.
- American Express Essential Credit Card: This card is ideal if you’re looking for a card with no annual fee, low interest rates, and added perks like purchase protection and access to exclusive events. It scores 8/10 for its affordability and unique perks, though limited acceptance could be a drawback.
- BMO Preferred Rate Mastercard: This card is better suited for someone who might benefit from the introductory balance transfer rate and doesn’t mind paying a small annual fee. The wider acceptance of Mastercard is also a plus. It scores 7/10 due to the low fee and solid introductory balance transfer offer, though the higher ongoing interest rates and fees for foreign transactions are downsides.
In conclusion, if you value low costs and access to special events, the American Express Essential Credit Card is the better choice. However, if you’re looking for broader acceptance and a good balance transfer option, the BMO Preferred Rate Mastercard could be more suitable.
Low Interest Credit Cards
