42% of Singaporeans duped by "gold card" trap

Don't let looking cool fool you.

Nearly half of Singaporeans admit that they've signed up for a credit card because they thought it would look "cool" in their purse, wallet or used in front of friends or work colleagues.

According to a release from Enjoy Compare, based on its website, many bank customers put personal image ahead of the quality of the deal they were getting when making a credit card application.

The EnjoyCompare.com website – which helps people choose credit cards, insurance and loans at better rates – says that people are losing hundreds of dollars every year because they don't check available deals for the best rates and offer.

Here’s more from Enjoy Compare:

"Just because a credit card is gold in colour doesn't mean you're getting gold card treatment," says EnjoyCompare.com‘s Mark Hall, "and that means that they're missing out on lower interest rates and fantastic loyalty deals.

"You should check the market through our website at least once a year, and you could save hundreds of dollars after just a few minutes' research."

EnjoyCompare.com says that 42% of Singaporeans admit to signing up for a card because they thought it would make them look more impressive in front of friends or colleagues when they used it.

A poll on behalf of the company found that many people put the fact that the card was gold, platinum or "lucky" red over and above the offers that came with the account.

A great-looking credit card is great for your ego, especially when you pay with a gold one in front of your boss," says Mark Hall, "but think about what you're getting for your money."

The same poll found that (some people gave more than one answer):

24% looked for the lowest available interest rate

19% looked for a card that offered a high spending limit

12% wanted a low annual fee

8% looked for outstanding loyalty or points deals

EnjoyCompare.com says these figures show that people have the wrong priorities when it comes to selecting their credit card.

"Our own research shows that 90% of credit card holders have never changed their cards since the day they applied for them," said EnjoyCompare.com’s Mark Hall, "and people looking for their first or additional card aren't choosing them for the right reasons."

The financial planning website says that your choice of credit card should be based on a number of criteria, not how it looks in your wallet.

"Going for a high spending limit is absolutely wrong," says Mark Hall, "You should never leave a balance on your card at the end of the month because that leaves you with interest to pay, and that's bad business.

Depending on your lifestyle, the card with the cheapest annual fee might not actually be the best one for you, EnjoyCompare.com says.

"The smart customer looks for a deal that offers a great return for your annual fee – look for great rebate and discount deals and you can find yourself 'in profit' within months," Mark Hall says.

"But most of all, don't fall for the 'gold card' trap. All that glistens is not necessarily gold service."