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Charge Cards: "Unlimited Rule"
The "Unlimited Rule" applies to Amex charge cards only.
Charge cards technically don't have a credit limit (I'm sure they do based on risk), and the expectation is that you pay off the balance in full each month or risk your account being shut down. Amex sometimes runs promotions where you can treat a charge card like a credit card and carry a balance, but your mileage may vary.
- PRG (Premier Rewards Gold)
- Platinum co-branded (Charles Schwab, Ameriprise, Mercedes-Benz, Goldman Sachs, Morgan Stanley)
- Business Green
- BGR (Business Gold Rewards)
- Business Platinum
Important note: Despite having "Platinum" in the name, the Delta Platinum is a Delta *credit* card, not a charge card. i.e., You can't get into the Centurion Lounge with it (I've seen people try).
For most people, I think it only makes sense to hold 2-3 charge cards to be sure you're getting positive expected value.
I usually recommend getting the Amex Platinum first because it comes with a handful of benefits:
- Marriott / Ritz / SPG Gold status
- Hilton Gold status
- Access to select ticket pre-sales (Hamilton, Museum of Ice Cream, etc.)
- Centurion Lounge
Credit Cards: "4/5/6 Rule"
The "4/5/6" rule means that you can have 4, 5, or 6 credit cards from American Express. To be clear, this rule only applies to cards issued directly from American Express, and not cards that use the Amex networks.
Examples of cards that would NOT count for the 4/5/6 rule:
- PenFed Pathfinder Amex
- FNBO TravElite Amex
- Wells Fargo Propel Amex
- Macy's Amex
- U.S. Bank FlexPerks Amex
- USAA Cash Rewards Amex
An easy way to think of it is that this rule only applies to cards that you can find directly on the American Express website.
Amex 4/5/6 Rule Cards:
- Delta: Blue, Gold, Platinum, Reserve, Gold (Business), Platinum (Business), Reserve (Business)
- Hilton: Hilton, Ascend, Aspire, Ascend (Business)
- Core: Blue Cash Everyday, Blue Cash Preferred, EveryDay, EveryDay Preferred
- Starwood: SPG, SPG (Business)
- Other: Charles Schwab, Mercedes-Benz
The 4/5/6 rule applies to both personal and business cards, and it's considered one hard pull, not separate.
For example, if you have two business credit cards and three personal credit cards from Amex, then you've reached the maximum.
The same rules apply if you currently hold five personal credit cards from Amex, you're not going to be approved for a business card if your maximum limit is five cards.
It's not clear how Amex decides who's cap will be 4, 5, or 6 credit cards. Most people fall into the five card category. My guess is that it depends on your relationship and history with Amex.
"5 Card Cap" but with 6 Cards
People who fall under the six card cap are likely due to the Citi Hilton forced product change. When these people apply for a new card, Amex calls them asking them to close TWO (2) cards and not just one, enforcing the five card cap.
This means if you are "artificially" at six cards, you will eventually need to drop back to 5 (unless you) don't intend to apply for any new cards, ever.
= 6 cards - 2 closing + 1 new cards
= 5 cards (eventually)
Unlike charge cards, it's more feasible to have more than one Amex credit card because there is a handful that doesn't have an annual fee.
Examples of "keeper" Amex credit cards:
- Amex Blue Cash Everyday
- Amex EveryDay
- Amex Delta Blue
- Amex Hilton Honors
Just because a card is a keeper card doesn't mean that you shouldn't cancel it.
Why I canceled a "keeper card" (Amex Hilton) for the Hilton Aspire
For me, the 4/5/6 rule is interesting because I fall under the five card cap. I reached my five card limit and decided to cancel the no annual fee Hilton card to get the Hilton Aspire.
I do have other Amex keeper cards that didn't make sense to cancel because they were either less than a year old, or they were a strong keeper card like the Amex EveryDay. If you cancel a card before the first year, then Amex reserves the right to "claw back" the bonus.
The no annual fee Hilton card was 1-2 years old, and it made the most sense to cancel because it didn't provide value anymore. Canceling the card didn't affect my credit history because I have a strong ten card foundation for my credit history.
I didn't upgrade the Hilton card because I would lose out on the signup bonus since I would be holding the card. Amex has a once in a lifetime rule for signup bonuses.