The new American Express Gold Card. Amex is finally updating one of its most popular products. Cause for celebration for some and dismay for others, they appear to be doing what many competitors are, millenializing it. Today I’ve got the rundown on all the card’s new features and their associated valuations.
New American Express Gold Card Basics
First up we’ve got the annual fee. Their kicking the new Gold Card off with a $250 one. This is up from the old card’s 195. Sadly, there doesn’t appear to be a first-year fee waiver as was the case on the now discontinued product. This is inline with premium cards, like the $450 Sapphire Reserve or $550 Amex Platinum, but odd for a semi-premium one.
To get the product moving, American Express is offering new cardmembers 25,000 Membership Reward points to new Gold Card customers. Based on my most recent valuations, Membership Rewards are worth 2.26¢ a piece. Running the math and this valuation makes 25,000 of them worth $565. I’ve seen worse, but also a lot better. Back when the Chase Sapphire Reserve launched, it came with 100,000 Ultimate Rewards worth roughly $2,000. That was a monster and got everyone in the points and miles game all hot and bothered. Most will find the new Gold Card’s signup bonus disappointing.
Though 25,000 is the standard, public offer, a 50,000 point signup bonus is frequently available. Most commonly, one can acquire this offer via a personal referral link. That is, when an existing American Express cardmember refers a new one. For anyone interested, as of 11/6/2018, this offer is currently available here http://refer.amex.us/AARONWwWOF. If approved, both you and I will receive rewards.
The Switch to Travel and Dining Bonuses
So far, we’re not off to a good start. A lack of a fee-waiver and a kinda-sad public signup bonus aren’t likely to generate much excitement. But, from here on out things generally take a turn for the better, sans a couple detours. I said before this card has been millenialized, even the marketing material reflects this. That aside, the biggest evidence of millenialization is the transition to primarily travel and dinning related benefits. Apparently, that’s the only thing that card issuers think we do. Pretty much all banks are making this switch. Finally, if there was any doubt left. The new American Express Gold Card is being offered in both gold gold and rose gold. Apparently that matters.
Earning with the Amex Gold Card
On the earn-side, we’ve got a fantastic 4 points per dollar on restaurants and supermarkets. Restaurant earn bonuses are pretty common. It’s the bonus on supermarkets that really stands out to me. From everything I’ve read so far, it honestly could be the most compelling reason to hold this card. It’s just kind of unique. At 2.26¢ each, that means you’re effectively earning 9% back on supermarket and restaurant spend. That’s quite exceptional. You’d be hard-pressed to find any card, premium or not, that could do better.
|4x||Restaurants and supermarkets|
|3x||Airfare and travel booked via Amex|
Along the same lines, we’ve also got a $120 annual dining credit that’s not really worth $120. Let me explain. This dining credit is only good at participating partners. At this moment in time, that means Grubhub, Seamless, Shake Shack, The Cheesecake Factory and Ruth’s Chris Steak House. If you’re pretty sure that you’d spend $120 a year at some combination of those restaurants or delivery services then I guess it is worth $120. I’m not, so I say less.
Last mention in the dining category is a limited time, 20% rebate on US dining purchases made on your new American Express Gold Card. This is capped at $100.
Next up we’ve got 3 points per dollar on flights booked directly with airlines or via American Express travel. This is just ok, I much prefer Chase’s far broader travel category that includes everything from 3rd party airfare to hotels, subways and Uber’s, regardless of how its booked.
New American Express Gold Cardholder’s will receive a $100 airline fee credit that, like the dining credit, I don’t believe is actually worth $100. I only believe something is worth it’s full value if I’m almost guaranteed to spend that money anyway. Now, for someone that fly’s a couple times a year, doesn’t hold any co-branded airline credit cards and doesn’t fly Southwest, that $100 will likely cover some bag fees and thus could be said to be worth the full $100. But for someone like me, that $100 would likely be spent on things that I wouldn’t buy otherwise. Let me explain. I currently hold the Southwest Companion Pass, thus, I’ll likely fly them with and their free bags domestically. Internationally, baggage is usually included regardless of carrier. Assuming it’s not a low-cost one. Then, there is in-flight food. I don’t buy it, it’s gross and overpriced. To add a real-world, personal example, I currently hold the Platinum Card from American Express, and, going into the end of the year, still have $250 out of $250 left on my annual airline fee credit. By comparison, my annual $300 travel credit I get with my Sapphire Reserve is generally used up within first month of the new year. So that’s why I say a $100 airline fee credit isn’t really worth $100.
That said, there is an alternative method by which one may seek to redeem their American Express Gold Card airline fee credit. Gift cards. Though not officially sanctioned by Amex, in fact, it’s specifically excluded, many real-word data points suggest success. So YMMV, but consider it an option.
Rounding things out, we’ve got pretty typical semi-premium card benefits, these include foreign transaction fee waivers, purchase protection, rental car coverage, etc.
How Much is it WORTH?
Now that we’ve got the benefits laid out, let’s try and figure out exactly how much value one would expect to glean from the card. As I’ve done in several other card comparisons, I’m going to use my own 2017 spending pattern as the basis, and apply those percentages to a hypothetical $18,000 annual card spend. Our comparison card will be the Chase Sapphire Preferred. From this card’s price-point, it doesn’t really have a direct competitor, so I am going a little down-market.
The first thing to notice, is that not all bonus categories match up to their respective bonus earns exactly. This is because some, like travel and entertainment, are a mix of normal and bonus earn. So, I usually just go in the middle. Right out of the gate, and we see the new American Express Gold Card generating $274 more in value than the Chase Sapphire Preferred. This is not exactly unexpected. Those monster 4 point per dollar bonus categories all but guaranteed a win here.
New Amex Gold vs Chase Sapphire Preferred – Year One
Starting with the value of the intro bonuses, we’ve got $565 for the new Amex Gold Card and $1,095 for the Sapphire Preferred. Taking those year one earn on spend values from a minute ago and dropping them here and we’ve got $752 for the Amex and 447 for the Chase. The 20% intro dining rebate, annual dining credit and airline fee reimbursements come in next. The last two are discounted, as they’re not even guaranteed to be useful. 90 and 75 bucks to the Amex Gold. And finally, I like to use a generic $50 for misc purchase protections and insurances. For premium cards, like the Platinum or Sapphire Reserve I go 100. The cost of the card is a big liability for Amex. We’re getting charged $250 while Chase waives this in year one for the Sapphire Preferred. So, now we can see our net value for year one is $1,382 for the new American Express Gold Card and $1,622 for the Chase Sapphire Preferred.
New Amex Gold vs Chase Sapphire Preferred – Second Year and Beyond
Moving on to year two and beyond and those intro bonuses go away. Almost everything else stays. Big difference now, is that we’re paying $95 for the Sapphire Preferred, whereas last year it was free. This leave us with a net value of $717 for the new American Express Gold Card and $432 for the Chase Sapphire Preferred.
In year one, the Sapphire Preferred is worth $240 more than the new Amex Gold. In year two and beyond, the Amex opens up a $284 annual lead. Based on these numbers, I know which one I’d pick, the Chase Sapphire Preferred. Here’s why. First, I don’t have to outlay any money right off the bat. Basically, I’m gleaning value before actually giving Chase any money. I like that. Next, it takes the new Amex Gold Card nearly 2 years to catch up to the Chase Sapphire Preferred. That’s too long, an eternity in terms of credit card products. Card issuers are constantly one-upping each other, and a few years down the road, who knows what will be offered. Finally, I don’t like the price point of the American Express Gold Card. $250 is a weird number. It’s over the $100’ish of most semi-premium cards, but doesn’t offer any of the really good stuff premium cards do. For $200 more, you could open a Chase Sapphire Reserve, with that, you’ll be getting big, usable, broad-category travel credits, lounge access and better purchase protection. Honestly, the big draw for the new American Express Gold Card is the 4 point per dollar bonus earn on supermarket purchases. A benefit not really duplicated elsewhere. To me, that would be the only reason to open this card and that’s simply not enough.