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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 Card||Premier 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 cycle||N/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.
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?