American Express has just introduced two new rewards credit cards called the AmEx Everyday and AmEx Everyday Preferred. Note that these are NOT the same as the Blue Cash Everyday and Blue Cash Preferred cards. They are worth a look as they offer a unique rewards structure, although it can be a bit tricky to maximize their value. Here is my review and comparison with similar cards.
Both are credit cards that let you carry a balance, as opposed to charge cards that make you pay in full each month. However, they both earn “real” Membership Rewards points just like the traditional Gold or Platinum charge cards. This means the points can be transferred to 17 different airlines including British Airways, Delta, and Hawaiian Airlines and 5 hotel loyalty programs. Otherwise, you can get about 1 cent per point when used with their “Pay with Points” feature or if converted to gift cards (Home Depot, Gap/OldNavy/Banana, Zappos, etc). Here’s how they differ:
- Sign-up bonus: 10,000 Membership Rewards points after you use your new Card to make $1,000 in purchases within the first 3 months.
- 2x Membership Rewards points at US supermarkets (up to $6k in purchases per year), 1x points on other purchases..
- Possible 20% bonus on points earned. Use your Card 20 or more times on purchases in a billing period and get 20% more points on those purchases (less returns and credits).
- No annual fee. No annual fee for additional cards.
- Sign-up bonus: 15,000 Membership Rewards points after you use your new Card to make $1,000 in purchases within the first 3 months.
- 3x Membership Rewards points at US supermarkets (up to $6k in purchases per year), 2x points at US gas stations, 1x points on other purchases.
- Possible 50% bonus on points earned. Use your Card 30 or more times on purchases in a billing period and get 20% more points on those purchases (less returns and credits).
- $95 annual fee. No annual fee for additional cards.
In order to maximize your rewards earned, you’ll need to makes 20 purchases on the no annual fee version or 30 for the Preferred version. For most people, that means this card has to be your primary card. Otherwise, you may have to work a little to meet that hurdle. You might buy some small Amazon.com gift codes, take a few extra trips in that self-checkout line, spend some extra time pumping gas, or pay your cell phone bill in small chunks. The good news is that you can track your purchase count easily with the AmEx mobile app designed to work with this card.
Both cards also have a EMV smart chip, but unfortunately foreign transaction fees are not waived. I’m guessing that is because this is an “everyday spending” card and not a “travel rewards” card.
The problem is that in order to maximize the total value of this card, you’ll have to get more than 1 cent of value out of a Membership Rewards point. Because even with the boosts, at 1 cent per point the most value you could earn with the is 2.4% back on groceries (Everyday no annual fee) or 4.5% back on groceries and 3% back on gas (Everyday Preferred $95 annual fee). Yet the existing Blue Cash Everyday card already gets you 3% cash back on groceries and 2% cash back on gas with no annual fee, and the Blue Cash Preferred gets you 6% back on gas and 3% back on gas with a $75 annual fee.
However, if you can get around 1.5 cents of of value out of a Membership Rewards point by converting it to airline miles, this card becomes better than the Blue Cash cards. The numbers then work out to 3.6% back and 6.75% back on groceries, respectively. That’s pretty solid. (Break-even value is 1.25-1.33 cents per point.) So while it is not marketed as a travel rewards card, it is really only best for people who can redeem their points efficiently via airline miles. Make sense?