Forget Apple Card, this is the credit card I’d use to buy an iPhone

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One of Apple Card's biggest selling points is its consistent 3% cash back on all Apple purchases, whether that be a new Mac, AirPods, or even Apple's services like Apple Music and iCloud storage. While it may seem like a no brainer to use your Apple Card to purchase your next iPhone, we've done the math and found that there is another card that beats out Apple, and that is the American Express Cash Magnet® Card. There are three reasons I would use this card over Apple Card for my next iPhone: rewards, protection, and compatibility.

Earn a ton more in rewards

At first look, Apple Card's 3% cash back on all purchases made at Apple is a tough perk to beat when compared to the 1.5% cash back earned on the American Express Cash Magnet® Card, but things get more interesting when you consider the other things that are commonly offered with a new credit card. The first is a cash back welcome bonus, and the second is an interest-free introductory offer, both of which Apple Card is lacking.

The American Express Cash Magnet® Card, on the other hand, offers both of these. New cardholders will earn a $150 statement credit after spending $1,000 or more in purchases within the first 3 months of Card Membership, an easy feat considering a new iPhone XS costs $1,000. Even if you bought the iPhone XR at $750, you're only $250 shy of earning the credit, not a hard task considering you have 3 months to complete it.

The card also features an intro APR of 0% for 15 months on purchases and balance transfers (then a variable rate, currently 15.24% to 26.24%). This essentially means that not only will you earn more cash back than Apple Card when buying your next iPhone, but you'll enjoy interest free payments for the first 15 months, plenty of time to pay off your new device.

Cash back magnet

American Express Cash Magnet® Card

See at The Points Guy

Unlimited 1.5% Cash Back on your purchases. Earn a $150 statement credit after you spend $1,000 or more in purchases with your new Card within the first 3 months of Card Membership. Low intro APR: 0% for 15 months on purchases and balance transfers, then a variable rate, currently 15.24% to 26.24%. No annual fee.

Protection for your new iPhone

One of the biggest missed opportunities with Apple Card is its lack of AppleCare+ being included as a card benefit to protect your iPhone from accidental damage. Even if you use your Apple Card to buy your new iPhone at Apple, there is nothing like an extended warranty or accidental damage protection to be found on the card.

The American Express Cash Magnet® Card includes a few benefits to help protect your new iPhone purchase. The first is an Extended Warranty, which will extend your iPhone's warranty by up to two years as long as it is considered an eligible purchase. The second is Purchase Protection, which for eligible purchases will protect your new iPhone from accidental damage and theft for the first 120 days after your purchase. It's not AppleCare+, which you can pay monthly or yearly to cover your iPhone in perpetuity, but it is 120 days of free accidental damage and theft protection.

Don't get locked into one merchant

While the 3% cash back on purchases at Apple is great, it is also restricting your rewards to have to be earned at Apple. A lot of places sell Apple products now, and Apple Card's highest cash back tier is useless at any merchant besides the brand itself. That means that if you find a great deal on a new iPhone at Best Buy, Target, or your carrier, you're not going to get downgraded to either 2% or 1% cash back (depending on if you can pay with Apple Pay).

The American Express Cash Magnet® Card, on the other hand, is not tied to any specific merchant. You're going to get the $150 statement credit, 0% APR for 15 months, 1.5% cash back, Extended Warranty, and Purchase Protection no matter what merchant you shop it. This gives you so much more freedom and the ability to shop around and make the best deal on your new iPhone even better.

Final word

Apple Card is a fantastic credit card with a ton of great benefits, but don't limit yourself when it's time to get your new iPhone. Buy it where you want and earn the most rewards and benefits you can!