AmEx Eliminates Threshold Bonus On Best Membership Rewards Card

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American Express will be eliminating the 15,000 point bonus on the American Express® Premier Rewards Gold Card as of 2015.

What are the implications here, and why is this a big deal?

Background on the Premier Rewards Gold

I’ve had the American Express® Premier Rewards Gold Card for years. It’s one of the first cards I ever applied for. Anecdotally it’s fairly easy to be approved for, given that it’s a charge card and not a credit card (meaning you have to pay off your balance in full each month, making it lower risk for the issuers than a credit card).

Historically it has offered the following major benefits:

  • 3x points on airfare purchased with airlines
  • 2x points on gas purchased at US gas stations & groceries purchased at US supermarkets
  • 15,000 bonus points for spending $30,000 on the card within one year

Though there have been some downsides as well:

  • It has a $175 annual fee, though it’s waived the first year
  • It has foreign transaction fees of 2.7%

Still, Membership Rewards points are extremely valuable, so up until now I’ve found the card to be worth keeping.

I put a lot of airfare on my credit card (most of it is reimbursable), so being able to earn triple points on that, plus a 15,000 point bonus when I spend $30,000 on the card in a calendar year, is pretty awesome.

In other words, $30,000 of airfare earns me 105,000 Membership Rewards points (triple points plus a 15,000 point bonus). It’s tough to beat 3.5 Membership Rewards points per dollar spent on airfare. To me, that has justified the fairly high annual fee.

Premier Rewards Gold Card eliminating 15,000 point bonus

Anyway, it looks like American Express will be eliminating the 15,000 point bonus on the American Express® Premier Rewards Gold Card as of 2015. Via The Points Guy, here’s their explanation:

We are eliminating this because the majority of Premier Rewards Gold Card Members did not meet the annual spending threshold of $30,000 and did not get the point bonus. Instead, we are evaluating other benefits and services that we believe may provide value to more of our Premier Rewards Gold Card Members.

Frankly, I’m kind of surprised a majority of cardmembers didn’t meet the spending threshold. Paying a $175 annual fee on a card you don’t even spend $30,000 per year on doesn’t make much sense, in my opinion.

If you have the Premier Rewards Gold Card, will this benefit change?

Yes, this impacts both existing and new cardholders, effective next year.

Why this surprises me

I’m really surprised to see this change. Earlier in the year American Express announced the American Express EveryDay Credit Card, which offers double points on groceries (up to $6,000 per year) and a 20% points bonus when you use your card 20 or more times per month.

The best part is that the card has no annual fee. Between the Amex EveryDay℠ Credit Card and Amex EveryDay℠ Preferred Credit Card from American Express, I believe American Express created two cards which actually match the overall benefits of the American Express® Premier Rewards Gold Card, minus the sting of the high annual fee.

So I figured we’d see them add more benefits to the card, rather than take some away, which makes the card even less compelling.

Does the Premier Rewards Gold Card still make sense?

If you spend a lot of money on airfare, gas, and/or groceries, it definitely could still make sense to keep the card starting next year.

I do think there’s value in applying soon if you are a big spender, so you can still earn the 15,000 point bonus for this year. The $175 annual fee is waived the first year, and the card does offer a sign-up bonus of 25,000 bonus Membership Rewards points after spending $2,000 on purchases within the first three months of card membership.

So  should I switch to the EveryDay cards?

For this year, not necessarily, but unless American Express rolls out some benefit updates to the Premier Rewards Gold, then generally yes.

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.

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

So unless you have a significant amount of domestic airline spend, you’re likely going to be better off with the EveryDay Preferred, and using a different credit card for your airline ticket purchases.

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 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 make the card more competitive, 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 don’t actually put a dime of spending on except on airfare directly with the airlines. The card allows you to earn 5x Membership Rewards points per dollar spent on airfare directly purchased with the airlines, 1x Membership Rewards points per dollar spent on everything else

If they could somehow integrate the Platinum Card and Premier Rewards Gold Card to offer a card with benefits plus rewarding spending categories, I’d be sold on it, even if they raised the annual fee. I’d also like to see Amex bring back the Membership Rewards shopping portal, to better compete with other programs and provide other ways to earn Membership Rewards points.

Bottom line

As much as I think I understand why issuers make certain decisions, this one blows my mind.

I’ve been the biggest fan of the American Express® Premier Rewards Gold Card for years, and unless they’re looking at phasing out the card entirely I’m not sure why they’d do this.

What about you? Will this change which cards you use next year?

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Comments

  1. Thanks for the info. I too wish that they would add the 3x points on airfare to the Platinum card, because we would make the switch in a heartbeat. Over half of what we spend is airfare, so for now it makes sense to keep the Gold vs. Platinum, but we’d gladly pay the higher fee if all the benefits were rolled into one card. It is a bummer to see the 15k bonus disappear. I don’t believe that most cardholders don’t spend $30k in a year. We put almost ten times that across ours and we aren’t a very big company.

  2. Funnily enough, the 15,000 bonus at $30K in spend was the only reason I have kept the card (that, and the free additional cards). I have often wondered whether it is worth keeping, given the hefty foreign transaction fees and the minimal airfare spend I put on cards (I am a staff traveler).

    Now the answer is clear, and I’ll be getting rid of it (after I collect my 15K bonus for this year).

  3. I hope Chase introduces this bonus now on Sapphire… it would not cost them much and would be hilarious.

  4. Wow! I am only $400 away from crossing this year’s $30,000 threshold…which, I guess will be my last time. Sad to see it go away!!

    It will certainly make generating Membership Rewards points tougher in the future as I will now question keeping my Gold Card.

  5. no more PRG for me…the 15K bonus was the only thing that really made this card worthwhile.

    On a more random note, I have become more and more confused by Amex’s business strategy. Their cards seem to be consistently cutting bonuses, benefits, and service while competitors improve.

  6. Wow! As someone who meets the $30k spend on the card I’m disappointed to hear that they are eliminating the point bonus. I’ll certainly be dropping this card when the annual fee comes due.

  7. What has been your experience with Amex’s retention offers for the PRG card? Would you keep it if they waived the annual fee? I’m on the fence whether to keep this card. I just met my $30k min threshold so I should be getting the extra 15000 points soon.

  8. i agree with what aarek said… what is Amex’s business strategy? are they trying to get out of credit card business?

  9. AMEX needs to axe this card and introduce a true competitor to Chase Sapphire. Only way this card becomes more attractice is removing FTF and expanding 3x earning to general travel or adding an additional bonus category such as dining.

  10. 30,000/12 = 2500 per month. May not sound terribly high, but if it’s not your only or at least primary card, it could be difficult to reach that threshold

    Lucky what do you (or others) value the Delta American Express Gold? I know that Delta skymiles are not among the more highly rated FF programs, but points are easy to accrue and the ‘pay with miles’ option (every 10,000 points –> $100 off flights) is very useful as you’re not restricted on what flights you can take. .

  11. Wow, most of your airfare is reimbursable? I didn’t think you had a conventional job where you would be able to expense that kind of thing.

  12. @ Adi-T — Ultimately I don’t think it’s a very rewarding card for everyday spend, since you earn one mile per dollar on most spend. Getting a return of one cent per point using the “pay with miles” option isn’t very good, given that the Barclaycard Arrival Plus and Chase Sapphire Preferred would give you a higher return.

  13. It would be great if they would give the Platinum some bonus categories but if they haven’t done so by now I sort of don’t think it’s gonna happen.

  14. Hey Lucky–I’ve had a gold card for over twenty years. If I downgrade will it change my credit report in terms of length of history? or will it stay the same, just with a different card?

  15. This really sucks. Where did Amex announce this. I’ve not heard this from them. As a card-member since 1985 and a having the PRGC since it was introduced, I’m very disappointed. I earn the bonus every year and without some new awesome benefit, they will be losing my business.

  16. American Express needs to focus on merchant acceptance instead of gutting card benefits, because they are losing merchants left right and centre, including CostCo in Canada.

  17. I’ve been considering trimming my Amex portfolio and this is probably enough to make me drop the PRG. I’ve been doing supermarket MS to get to the $30K mark each year. The bonus made keeping the card worthwhile. Since I don’t actually pay for much airfare, losing the bonus is pretty big.

  18. @Joey: Over at Flyertalk, folks have reported getting retention offers of up to 25K MR. I haven’t tried retention on this card in a while, but I’ll definitely try now.

  19. I have the PRG but haven’t been targeted for a Platinum upgrade offer with bonus points. Has anyone had experience getting it as an alternative to a PRG retention offer?

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