AmEx Everyday Preferred vs. Premier Rewards Gold Card

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Yesterday I posted about American Express’ announcement of the new credit cards they’ll be introducing on April 2, 2014 — the Everyday Card and the Everyday Preferred Card. This news was exciting because both cards accrue Membership Rewards points, which I find to be among the most valuable points currencies out there. Just to recap, the basic benefits of the two new products are as follows:

The Amex EveryDay® Credit Card

  • Annual fee: $0
  • Sign-up bonus: Earn 10,000 Membership Rewards points after spending $1,000 within three months
  • Earnings rates: 2x Membership Rewards points per dollar spent at U.S. supermarkets, for up to $6,000 per year of spend; 1x Membership Rewards point per dollar spent on everything else
  • Spending bonus: If you use the card to make 20 or more purchases during a billing cycle you get 20% extra points on all those purchases

Amex EveryDay® Preferred Credit Card

  • Annual fee: $95
  • Sign-up bonus: Earn 15,000 Membership Rewards points after spending $1,000 within three months
  • Earnings rates: 3x Membership Rewards points per dollar spent at U.S. supermarkets, for up to $6,000 per year of spend; 2x Membership Rewards points per dollar at U.S. standalone gas stations; 1x Membership Rewards point per dollar spent on everything else
  • Spending bonus: If you use the card to make 30 or more purchases during a billing cycle you get 50% extra points on all those purchases

It seems the American Express Everyday Preferred Card is intended to compete with the Chase Sapphire Preferred® Card, which has the same annual fee and also has similarly rewarding bonus categories.

But what I’m especially curious about is how they plan on marketing this card in relation to the Premier Rewards Gold Card from American Express, which seems to generally be targeting a similar consumer.

To compare the benefits of the two cards side-by-side:

American Express EveryDay Preferred Credit CardPremier Rewards Gold Card from American Express
Annual fees:$95$195 ($0 introductory annual fee for the first year)
Sign-up bonuses:Earn 15,000 Membership Rewards® points after you make $1,000 in purchases with your new Card in the first three months.
Terms and limitations apply.
25,000 Membership Rewards points after spending $2,000 within three months
Terms and limitations apply.
Earnings rates:- 3x points at U.S. supermarkets (up to $6,000 per year)
- 2x points at gas stations
- 1x points on everything else
- 3x points on airfare
- 2x points on restaurants, gas, and at supermarkets in the U.S.
- 1x points on everything else
Spending bonuses:50% points bonus when you make 30 or more purchases during a billing cycleN/A

Now if you’re going to get the Everyday Preferred Card and maximize it with 30 purchases per billing period (which you should), you’re looking at earning 4.5 Membership Rewards points per dollar spent at supermarkets, and 3.0 Membership Rewards points per dollar spent at gas stations.

So are the cards complements or substitutes?

Both of these cards are compelling but almost substitutes, so I kind of wonder how they plan on positioning them. I love the Premier Rewards Gold Card from American Express for the triple points on airfare. That’s hugely valuable to me given how much airfare I put on my credit card (not just my own, but also airfare from others).

But the other categories aren’t as rewarding as the Amex EveryDay® Preferred Credit Card. If maximizing the Everyday Preferred Card with 30 purchases per billing cycle you’re earning an additional 2.5 Membership Rewards points per dollar on supermarket purchases and an additional 1.0 Membership Rewards points per dollar on gas stations over what you’d earn on the Premier Rewards Gold Card.

So it’s just kind of puzzling, because American Express has two products that both accrue Membership Rewards points and are similarly rewarding, yet one has an annual fee that’s $80 per year higher.

So what could American Express do to differentiate the Premier Rewards Gold Card?

Assuming American Express wants to keep the Premier Rewards Gold Card around, I do think they should do something to differentiate it a bit, like:

  • Eliminating foreign transaction fees
  • Sprucing up the bonus categories, maybe by matching the Everyday Preferred earnings rates on gas an groceries

Or ideally I’d love to see them spruce up the The Platinum Card® from American Express, which I keep year after year and find to be well worth the annual fee, though I don’t actually put a dime of spending on except on airfare directly with the airlines as it earns 5X per $1 spent.

What do you think? Does the Premier Rewards Gold Card need a makeover with the introduction of the new Everyday Preferred Card? If so, what benefits would you like to see?

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Comments

  1. I think you’re right about the foreign transaction fees on the Amex PRG. I also suspect they’ll introduce more travel-related spend bonuses on the PRG and/or the Platinum, to make them more competitive with Chase offerings. But I guess time will tell.

  2. They definitely need to do something with the PRG and the Platinum. Unless you spend a lot on airfare, the PRG isn’t worth having, and the Platinum has been gutted with the end of lounge access. I know I’m probably going to get one of these new cards and cancel my Platinum, and I already canceled the PRG.

  3. For me, this card is a perfect replacement for the Amex Plat. I don’t really travel enough to get any value out of the Priority Pass membership. I’ve already got Global Entry.

    The 3x grocery spend and 2x gas is great. Plus the bonus. As long as I can tie the new card to my existing MR point account balance. If they would make it foreign transaction fee free it would be an even stronger competitor to the CSP card. I wonder why Amex refuses to do that while Chase seems to be making more and more of their card foreign fee free.

  4. So what do you think is worth more: 1.5 MR points, or 1 SPG point?

    I just got the SPG card a month ago, but this Everyday Preferred just seems like it’ll be a better deal all around for general spending. After the 50% bonus, you get 4.5x groceries, 3x gas, 1.5x everything else? That’s pretty amazing, and let’s face it, it’s trivial to make 30 transactions in a month if you turn this into your general spending card.

    The low sign-up bonus kinda sucks, though.

  5. Just to clarify, is the 2X at gas stations for gas station coded transactions or is it for pay at the pump? Also, is there any limit on 2X gas??

  6. @ Mike — I’d say that 1.5 Membership Rewards points are worth marginally more than 1.0 Starpoint. Agree, this is a compelling card for everyday spend.

  7. @ JohnnieD — It should be anything coded as a gas station best I can tell. I don’t see any limit on the bonus points for gas.

  8. I’m in a quandry. Agree that the 6K cap totally sucks. Maybe I will go for the free version, get what I can get out of it, and there’s no fee so I will just keep it. I don’t know if it is worth the pull…

  9. @Fat Ted
    Why would hitting 30 transactions be hard? That’s just one transaction a day, and it can be for anything.

    I spend a little less than $6k/year in groceries, so for me I think this card’s perfect. I was thinking of applying for the PRG, and maybe I still will, but only for the sign-up bonus.

  10. Is there a cap on 1.5 MR points when using more than 30 transactions per month? For business with large and frequent charges, is there a downside to this?

  11. @ SJ — Nope, as long as you have 30 transactions per billing period you earn 1.5 Membership Rewards points per dollar spent.

  12. I think if you can hit 30 tx a month, this becomes a low fee version of the UA club card without club fee or access
    1.5x on all spend is awesome

    if only they came with a card even for 1000 a year, with
    1
    ability to choose rewards at month end spg/amex etc
    2
    priority pass,
    hh gold, us dl a3 gold, etc etc
    3
    no foreign fee
    4
    1.5x on spend
    5
    bonus on groceries and airfare and office supplies

    That may make Plat card fees more bearable

  13. I just picked up the AA Elite for the 100k bonus and lounge access, so the timing on this new fee-free card is perfect. I’ve got a ton of MR points in my account, but no need for the Plat now. I’m planning to pick up my $200 in credits after 3/22, then drop down to the no-fee card to keep my MR points active.

  14. Do you still value MR at 1.8 cents each? That equals 8.1% on the first $6K of groceries. Hmmm, could signal the end of the Blue Cash Preferred, my go-to grocery card. AMEX seems to be cannibalizing itself a bit.

  15. @ dubaych — Will have updated points valuations soon, but yep, that’s around what I value Membership Rewards points.

  16. Hi Lucky –

    Do you believe Amex will in the near future provide more benefits for Platinum Card holders in lieu of the recent devaluations to that card?

    Thanks.

  17. Just in time for me, as the AF on my PRG is coming due soon. When I cancel it I need to keep my AMEX age of account and MR points.

    I’ll use the Preferred mainly for grocery spend, since I tend to shop every two or three days anyway, at both the large grocery store and the TJs next door to each other.

    I drive by there nearly every day, so 30 swipes is only 15 stops a month with no extra commute costs. Hard to beat 4.5X on groceries, and the 3X on gas just makes it all sweeter.

  18. Trying to figure out the math of maxing the 4.5x$6k + unlimited gas vs. 45k annual + unlimited 2x on gas and groceries. Seems if you feel like hitting the $30k for the year that’s your deal but you can get to 45k with the everyday without spending $30k. I can’t cone up with a reasonable comparison.

    Side note, I believe the 2x gas is for “standalone” gas stations which I interpreted as gas only, is that wrong?

  19. Will follow these developments to see exact T&Cs of the cards but, so far, Everyday Preferred looks good. I agree that Amex Plat needs to be revamped; I’d also like to see SPG Amex lose foreign transaction fee and get some bonus categories.

  20. I think I’ve got the comparison. Let’s say you max out the prem gold $30k at 2x for gas and groceries. $2500/mo will net you 75k pts at year end. (105k if you can do all $30k on airfare at 3x like a lucky blogger I know of) This is easy enough to do with most groceries offering $500 gcs. My personal situation would see me spend $500 in real gas and groceries every month (2ppl 1 car) and manufacture the other $2000 at the grocery store for a monthly cost of less than $30 in fees. (You will likely have to spend no less than $20/mo just trying to hit 30 transactions with everyday preferred)

    Now for everyday preferred as blogger noted the $6k x4.5 will land you a nice 27k points but after that things start to stretch. Generously giving gas at a 3x $140/mo will get you 5k for the year bringing your total to 32k for gas and groceries albiet only having to spend less than $7500. You can match the prem gold base of 45k by spending another $8700 at 1.5x for the extra 13k pts (or buying a lot more gas) but would need to spend almost $29k at 1.5x to get close to the 75k for the prem gold maxed out at 2x. Keeping in mind you have to do 30 transactions a month (360/yr) to get those multipliers. That’s a lot of gum to buy especially if you’re working on other cards during the month

    I think the bottom line is the everyday preferred is a great return on say the first $10k-$15k you spend if you do it right but the prem gold is a very straightforward way to end the year with 75k pts or more.

  21. I agree on the Platinum Card. I NEVER use it. It would seem that AMEX would like to encourage some usage, but without bonus categories, it isn’t going to happen for me. Also, I’m actually a pretty high spender, so once I reach the $30K spend and receive the 15K bonus, I stop using the PRG for everyday spending. It may make more sense for me to go with the new Everyday Preferred and get the 50% bonus each month. Making 30 transactions isn’t a problem.

  22. I acted on a targeted offer for the AMEX PRG two months ago and completed the spend.

    Today I received a “Pre-Selected Application” for the Everyday card in the mail with 25,000 welcome pints offer. This sounds like a better card for me based on my spend habits. Do I have a good chance of approval for this card if I apply? (My credit score is excellent), or should I wait a while?

  23. @ JAM — If it has been a couple of months then you have a good chance of being approved for the Everyday Card, in my opinion.

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