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One of the new features that’s come out in the past few months is the new American Express Every Day credit cards. Apparently there were (are?) a lot of ads for the product featuring Tina Fey. I’m not sure about that because we don’t really watch TV, but nevertheless I am still intrigued by the card.
There are two different versions of the card:
- Annual fee: $0
- Sign-up bonus: 10,000 Membership Rewards points after spending $1,000 within 90 days
- 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 earn 20% extra points on all those purchases
- Annual fee: $95
- Sign-up bonus: 15,000 Membership Rewards points after spending $1,000 within 90 days
- 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 earn 50% extra points on all those purchases
Fee-Free way to earn Membership Rewards
American Express Membership Rewards are one of the more valuable miles currencies out there. They transfer to a number of different partners (British Airways, Singapore Airlines, Delta, Hawaiian Airlines, etc). But until now, there was no way to accrue these miles without paying an annual fee. Carolyn has the Premier Rewards Gold Card from a May 2013 churn, and with that $175 annual fee coming up, we were looking at different options.
A nice thing about these cards is that they offer a category bonus in areas that a) don’t have a ton of cards that offer good category bonuses, like grocery and b) you use a lot (again, like grocery). The grocery bonus is limited to $6,000 annually, but that is still $500 / month. I’d say we spend more than that in a month, but then again, there ARE 8 of us 😀
Bonus for monthly usage
An interesting feature that these cards have that I haven’t seen anywhere else is the increase to the monthly bonus if you use the card a certain amount of times in a month. With the Basic Everyday card, if you use the card 20 times in a month, you get a 20% bonus. With the Everyday Preferred card, you need to use the card 30 times, but you get a 50% bonus (bringing the grocery bonus up to 4.5%, which is pretty good.
What remains to be seen is whether this will drive users to do crazy things like split grocery orders up in order to reach that transaction bonus. We are planning to pick this card up as part of our upcoming churn, so I will report back.
Downgrading to an Everyday Card
Carolyn has an American Express Premier gold card that she picked up in a churn last year. The $175 annual fee is coming due this year, and so I contacted Amex to see if there was a way that the fee could be waived or possibly downgrade to one of these Everyday cards. The analyst that I spoke to said that at this time, it is NOT possible to downgrade into one of these Everyday cards. So if you want one, you’ll have to sign up for it directly (which is good, because I want the signup bonus anyways!!!)
The Straight Dope
I knew that we definitely wanted one of these cards as a way to keep Carolyn’s Membership Rewards points active while not paying the $175 annual fee on the Gold card. I went back and forth about whether to pay the $95 fee for the Preferred version.
We definitely spend more than $500 a month in groceries, though a good chunk of our spending is at stores (Aldi, Sams Club) that don’t take American Express (Aldi doesn’t actually take credit cards at all). So let’s say $300 a month in groceries, and $200 a month in other spending. We’ll say that we meet the transaction criteria (20 or 30 in a month) in 8 out of the 12 months.
So with the Everyday we’d get 300*2 + 200 or 800 points a month, multiplied by 20% in 8 of the 12 months, for a total of 10880 Membership Rewards, or 20,880 with the signup bonus.
With the Everyday preferred we’d get 300*3 + 300 or 1100 points a month, multiplied by 50% (550 MR) in 8 of the 12 months. That’s 17,600 MR, plus 15K signup bonus, for a total of 32,600.
With the Preferred, the $95 fee gets us an additional 11,720 Membership Rewards points, or paying .81 cents per point. Not a super amazing deal, but I would rate Amex MRs as worth more than that. Your calculation will depend on your spending levels.
What about you? Would you prefer the Everyday card, or Everyday Preferred (or none of the above!)