This post was sponsored by Amex Bank of Canada. The views and opinions expressed in this blog, however, are my own. American Express is not responsible for maintaining or monitoring the accuracy of information on this website.
American Express® has launched a unique feature called Plan It™ that allows eligible American Express Cardmembers to turn credit card bills into a flexible installment plan.
Plan It will make it much easier to manage paying down your balance because you’ll go from trying to pay back one large monthly bill to making several, much more manageable lower monthly payments. This feature is especially handy for big, unexpected expenses that you didn’t have time to budget for and would be difficult to pay off completely by the time your monthly credit card bill is due.
Plan It offers the additional bonus of the peace of mind that you’ll get from having predictable, manageable payments without having to worry about fluctuating charges.
What is Plan It?
Plan It, the American Express Installment Program gives Cardmembers who can’t immediately pay their Card statement in full some financial wiggle room. With the Plan It feature (which is available on select American Express Cards) you can choose to defer a portion of your credit card bill into monthly installments of equal size. Plan durations range from 3,6,9, or 12 months, however you will only be offered 3.
Each of the monthly installments you will have to pay is clearly broken down into two parts: a fixed fee as well as the principal amount owed per month.
Everything is nicely laid-out, so you know upfront how much you owe each month. There’s no need to guess what your payments will be or try to figure out interest calculations, American Express does all the work for you. The entire process is very transparent and easy to follow (not necessarily adjectives normally associated with credit card payments – which is one of the things that makes Plan It so attractive).
Because your payments won’t fluctuate based on changing interest rates, your Plan It payments are consistent and predictable. This also has the effect of making it much simpler to manage your cash flow and balance your budget from month to month. Better yet, having a clearly laid out, simple-to-follow payment plan makes it easy to actually stick to, rather than just feeling like you’re barely keeping your head above water as you scrape by just to make minimum payments every month.
If you want to take advantage of Plan It, you may be wondering: can I continue to use my Card for everyday spending, like usual? The answer is yes. Here’s how it works when you participate in Plan It: every month you receive your statement, you’ll have your Plan It installment amount – which’ll be baked into your minimum payment and must be paid – along with your newly billed balance for all your other ongoing spending that you can either pay off in full to avoid interest or carry over to the next month, just like normal.
Oh, and did we mention that you can still earn cash back, points, or miles like you normally would with your Card even while using the Plan It program?
How Plan It works – the facts
American Express makes it easy to participate in Plan It. Cardmembers won’t need to enroll in Plan It or undergo a separate application or credit check just to take advantage of this feature. All you’ll need to do to participate is to login to your American Express Account online or via your American Express app to see if you are eligible.
Once you’re logged in, you can click “Create a Plan” from the online American Express account home page or in the Statement tab in your mobile app. Your installment plan can only consist of new balances billed to your current statement. Installment plans must be created between the date your billing statement is generated and 2 days before your payment due date.
In total, the amount you choose to plan should be at least $250. It’s important to note that you can’t use Plan It for balances on older Card statements – only the most recent balance applies. Unfortunately, prior months’ balances that have carried over are not eligible.
You’ll then need to pick your monthly plan. Plan terms range from: either 3, 6, 9, or 12 months. Note, however, that you’ll be offered only up to 3 plan options (of the 4) based on your balance amount and account history. Payments will be spread across a specified term with monthly payments all being of equal size.
There is a monthly fee applicable to each installment plan. The larger your installment plan, the larger your monthly fee. The monthly fee makes it easy to see exactly how much you will need to pay off each month. The Plan It feature is about managing your cash flow, not a way to save on interest payments. However, installment plans are much more transparent and easier to factor into your expenses.
You can create more than one installment plan. Your monthly installment payment will be built into your minimum payment information displayed on your Card statement.
When participating in Plan It, you can continue to use your Card for everyday purchases as usual. Your Plan It installment amount will be built into your minimum payment, meanwhile, all your other ongoing spending will accumulate its own balance – as usual – which you can pay off completely or carry over.
Plan It – an example
Let’s say you were to create a six-month installment plan for $1,000 in purchases. Here’s an example of how your monthly payments would work break down to assuming your monthly fee is 0.90%:
|Total amount borrowed||$1,000|
|Total fee||$54 (1000 x 0.90% x 6)|
|Total payments over 6 months||$1,054 ($1,000 + $54)|
|Monthly fee||$9 ($54 / 6)|
|Monthly payment||$175.67 ($1,054 / 6)|
|Monthly principal||$166.67 ($175.67 – $9)|
Some T & Cs
Plan It is available on the majority of American Express Cards. See below for eligible products:
- American Express CobaltTMCard
- SimplyCashTMCard from American Express
- SimplyCashTMPreferred Card from American Express
- American Express®AIR MILES®* Credit Card
- American Express®AIR MILES®* Platinum Credit Card
- American Express® AIR MILES®* Reserve Credit Card
- Marriott BonvoyTMAmerican Express® Card, and
- American Express EssentialTMCredit Card
Cardmembers who live in Quebec, Nova Scotia, Nunavut, and Prince Edward Island are also not eligible to participate in Plan It.
Only the primary Cardmember can create an instalment plan. However, according to the American Express Website, “…Supplementary Card transactions can be included in installment plan(s).”
Additionally, you’ll need to stay on top of Plan It payments because if you don’t make at least the minimum payment, your installment plan will be cancelled and any amount you owe will accumulate interest at your card’s applicable purchase interest rate.
Lastly, once you’ve enrolled in an installment plan, you are no longer able to edit the duration or size of the specific plan. You also can’t make additional payments to pay off your installment plan quicker. That said, you can cancel an installment plan at any time and any remaining amount of your principal balance will be added back to your regular Card balance where interest will be charged, subject to any applicable grace period.