Wednesday 12 May 2010

A Totally New Kind of Gold Card

Everyone has seen the infomercials and newspaper ads about selling gold because gold prices are historically high. But while you may not be ready to trade in your high school ring or grandmother’s necklace quite yet, you can start investing in gold by applying for a new kind of credit card that has a credit limit determined by current gold prices.

A company by the name of Gold Solutions Marketing in Florida is the brainchild behind the gold card. But unlike the American Express gold card or other VIP cardholder cards that are gold, this one is backed by gold that is held in a special vault in Delaware. Your credit card is tied to that gold so that the precious metal acts like collateral, and then as a cardholder you are given a credit limit that is equal to about 75 percent of the value of that gold bullion.

Credit card activity will be reported to the credit bureaus just like with a normal credit card, and because gold prices continually fluctuate the card limit will be reviewed at least once a year and adjusted accordingly to keep up with the value of gold. That means that if there is a sudden spike in gold prices you could automatically get a much higher credit limit, but by the same token your spending limit could be curtailed if the price of gold plummets.

The gold that is deposited belongs to you, which means you have to buy it up front to set up the card. But if you later decide to close the account you are entitled to receive either a cash payment based on your gold’s price on that day or you can get paid in gold coins and will be given the same amount of gold you started off with in the account.

The gold card is a bit of a gimmick that is probably not ideal for every cardholder. But those who will benefit from it the most are people who own some gold bullion and also need a secured credit card because they have bad credit. They can put their gold to good use to get a card, start rebuilding their credit, and eventually qualify for a traditional non-secured card. Meantime their gold is in a safe place and will be returned to them if they decide to close the gold card account.
Offshore Pro Group

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