Quick Tips
Robinhood Gold Card — My Initial Thoughts on the 3% Back Card
Earlier this week, Robinhood held its own keynote event it dubbed “The New Gold Standard.” Of course, before the big news at hand could be announced on stage, word that it was (mainly) in regards to the company’s upcoming credit card offering got out — including the Robinhood site updating with some details as the event got underway. In any case, the launch of the Robinhood Gold Card is certainly big news for someone like me who is both a credit card rewards enthusiast and a long-term observer of Robinhood. So, what do I think about the product that was presented?
First, let me cover some of the basics about what the Robinhood Gold Card is (or will be). Perhaps the biggest thing to know is that the card will earn a base of 3% back regardless of purchase category. That puts the card in a class of its own as most flat-rate cards top out at a 2% base — although some cards get closer to 3% if you meet certain spending amounts, account balance tiers, or other specialty criteria. Still, the ease of earning this 3% back makes the Gold Card unique.
On top of that, the card will also apparently earn 5% back on bookings made via a Robinhood travel portal. Oh, did you not know that Robinhood had a travel portal? Well, they don’t currently — but I guess they’re getting one.
The last big detail is that, while the card technically has no annual fee, you will need to pay to get it. That’s because the Robinhood Gold Card will be exclusive to Robinhood Gold customers. With Gold currently costing $5 per month or $50 per year, you can kind of imagine that as your annual fee (although you do get other benefits as a Gold member that may offset that).
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All of that brings me to my thoughts. As someone who lacks even a 2% base rate card, I’m definitely interested in adding Robinhood’s 3% card to my wallet. Previously, I’d considered the U.S. Bank Altitude Reserve card for this same reason, as it offers 3% back on mobile wallet purchases (which I rationalized would be available in most places). But, with that card carrying a $400 annual fee, the Robinhood Gold Card sounds like a better solution to my problem — although, when redeemed for travel, the Altitude Reserve’s points are worth 50% more, meaning that I could effectively earn 4.5% back on each purchase.
The other aspect of the Robinhood Gold Card announcement that interested me was the virtual card feature. Although this technology has grown in popularity and is fairly ubiquitous now, one on-stage demo impressed me as they were even able to generate a virtual card with a different name on it. I’m not sure that’s something I’ve seen before — and I’m not 100% clear that this was what was being demonstrated — but it would be interesting if it were. I mean, I don’t exactly know what I would do with such power, but I’m intrigued by the concept.
As far as the downsides of the card, the first is the Robinhood Gold requirement. Even as a long-time Robinhood customer, I’d never subscribed to Gold… until this week. Yes, in anticipation of this card’s release and the growing list of Gold features, I figured it was time to give it a shot. As far as what those other Gold perks are, customers can earn a 3% IRA Match on retirement account contributions (versus 1% for non-members), earn 5% APY on non-invested funds, enjoy higher instant deposit amounts, and more. Plus, during the keynote, a new deposit bonus was announced, which will allow Gold customers to earn a 1% boost on funds they add to their brokerage account. Oddly, though, these boosts will apparently be paid out over the course of 24 months.
Another major downside is that the card doesn’t have a welcome bonus (at least not one that’s been announced). Given the generosity of the 3% base, that kind of makes sense, but it’s disappointing nonetheless.
So, with that considered, is the card a good deal? Setting the other Gold benefits aside, if you only got Robinhood Gold for the credit card, the $50 annual cost would mean you’d need to spend more than $5,000 a year in order to make the 3% card a better deal than a no-annual-fee 2% flat rate card. That climbs to $6,000 in spending per year if you opt for the monthly Gold option, which brings your annual cost to $60.
To me, that seems like a fairly reasonable threshold and likely makes the card worth it for many. Alas, there are still other factors that could prevent someone from thinking this is a slam dunk. For one, while $5 a month/$50 a year is the price for Gold now, what’s stopping the company from hiking that fee in the future? Also, is 3% back on all purchases actually sustainable, even with the Gold requirement? Finally, there’s also the whole matter of Robinhood’s reputation. Personally, I’m still a fan of the company overall — but I know that’s definitely not the case for everyone.
Overall, I’m excited about the prospect of the Robinhood Gold Card. And while I’m not entirely sure I’ll end up applying, it’s something I’m absolutely considering. Oh, and I didn’t even get to the 36-gram, 10-karat real gold version of the card… but that’s a story for another day. In the meantime, I look forward to hearing more about what the Robinhood Gold Card will offer as I weigh my credit card options.
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