Diners Club: Good Deal

Competition is heating up in the discount-dining field. I’ve previously recommended the Transmedia card and the IGT card (In Good Taste). When you can get them without the $50 annual fee, as you sometimes can, you have nothing to lose. And if you use the cards at restaurants that honor them, in parties of six people or fewer, you get 25% off everything but the tax and tip. (For parties of more than six, you have to get an okay first.) I won’t go into the details here (call 800-422-5090 to see what Transmedia is currently offering, 800-444-8872 for IGT).

But now comes the offer many of you have gotten for the Diners Club card. I resisted it the first few times, even though they were dangling 10,000 frequent flier miles in front of me to sign up. The last thing I need is another credit card. But I finally broke down. (You can apply the Diners miles to almost any major airline frequent flier program — including American, Continental, Delta, Northwest, Southwest, TWA, United, US Air.)

To me, 10,000 miles are worth $200-$400 and the card costs only $80. So right there, at least in Year One (when you get that 10,000-mile bonus), they’re paying you for the nuisance value of having yet another card.

So I got one. And in addition to a mile for each dollar I charge, there’s an automatic 20% discount at more than 1,500 restaurants. That’s just as good as the Transamerica and IGT 25% because it applies to tax and tip as well as the meal. (On a $100 meal if the tax is $8 and the tip is $17, the total bill is $125. You save $25 either way — 25% off the meal-only, 20% off the whole bill.)

It’s even a tad better, because it applies to parties up to eight. If you’re the guy who pays the bill for eight people at $40 each including tax and tip — $320 — you’ll get $64 knocked off your Diners Club statement. And you’ll earn frequent flier miles for each dollar you do pay.

There’s no interest charge on the Diners Club card, which you’re expected to pay off on time. Indeed, they even give you an extra month’s grace period. (But don’t miss that, because if you do, hefty charges kick in — a $20 delinquent fee plus 2.5% on your entire balance.)

I hate to say it, because I own stock in American Express. But right now, the Diners deal appears to be even better than the Amex deal.

Tomorrow: A Tale of Two Diners