Amex Gold lost its shine (for me)

75

The Amex Gold Card has become relevant again now that it will offer 4X at restaurants worldwide as of June 6th (previously it offered 4X only in the US).  That’s a nice improvement to the extent that restaurants outside of the US accept Amex.

Last October I was pretty excited about the Amex Gold Card.  In the post “Is 4X worth $250 per year? How much are those Amex Gold 4X categories (grocery & dining) worth?” I wrote:

The new American Express® Gold Card offers an eye-popping 4 Membership Rewards points per dollar for spend at restaurants and grocery stores in the United States (grocery store 4X is limited to $25K spend per year).  That’s great.  Unfortunately, the card also offers a great big annual fee: $250.  Is 4X worth that fee?

First, consider that the card offers other valuable benefits:

  • $120 dining credit: $10 per month credit for spend at GrubHub, Seamless, The Cheesecake Factory, Ruth’s Chris Steakhouse, and Participating Shake Shack locations
  • $100 Airline Fee Credit: Get reimbursed for airline fees charged by your selected airline, up to $100 each calendar year.

If you already spend at least $10 per month with one of the dining credit merchants, then the dining credits should be nearly as good as cash back to you.  Otherwise, you will likely value this benefit far less than face value.

Similarly, the airline fee credit could be almost as good as cash if you know how to take full advantage of it (see: Amex Airline Fee Reimbursements. What still works?). Otherwise, you’ll probably value this benefit well below $100.

To determine whether the Amex Gold card was worth its high sticker price, I argued that the ability to earn 4X at US grocery stores (up to $25K, then 1X) was worth 2 cents per dollar above the best alternative, and the ability to earn 4X at US restaurants was worth 1 cent per dollar above the best alternative (see the original post for the logic behind these values).  With that info, I created this worksheet:

Your worksheet

Fill out these values to determine how much the Amex Gold card is worth to you:

  • $120 Dining Credit. If I could buy this as a membership, I’d pay: ____________
  • $100 Airline Fee Credit. If I could buy this as a membership, I’d pay: ____________
  • 4X at US Restaurants:
    • Weekly restaurant spend: ____________
    • X 52 =  ____________
    • X .01 = ____________
  • 4X at US Grocery Stores (up to $25K):
    • Weekly grocery spend: ____________
    • X 52 =  ____________
    • X .02 = ____________
  • Total annual value: ____________

If the total annual value is significantly more than the annual fee, then keeping the card each year makes sense.

And, in that same post, I filled out the worksheet based on my own situation at that time:

My worksheet (example)

Here are my values:

  • $120 Dining Credit. If I could buy this as a membership, I’d pay: $80
  • $100 Airline Fee Credit. If I could buy this as a membership, I’d pay: $80
  • 4X at US Restaurants:
    • Weekly restaurant spend: $150 (it’s probably much more than that actually)
    • X 52 =  $7,800
    • X .01 = $78
  • 4X at US Grocery Stores (up to $25K):
    • Weekly grocery spend: $200
    • X 52 =  $10,400
    • X .02 = $208
  • Total annual value: $80 + $80 + $78 + 208 = $446

$446 is significantly higher than the card’s $250 annual fee, so it’s definitely a keeper for me.

Things have massively changed

Since I posted the above worksheets in October 2018, a number of things have changed both in general and with my situation:

I haven’t been using the $10/month restaurant credits every month

I thought I’d easily earn $10 per month with the Amex Gold card thanks to regular Grubhub orders and occasional Ruth’s Chris happy hours.  And I have earned the $10 easily most months, but not every month.  That fact reduces the amount I value of the Gold card’s dining credits.

Citi Prestige now earns 5X at restaurants worldwide.

Prestige 4th Night Free

To me, I see 4X Membership Rewards and 5X Citi ThankYou points as being roughly equal.  But even though the Gold card will offer 4X at restaurants worldwide as of June 6, that doesn’t change the fact that Mastercard is accepted in far more places.  Regardless, since I have the Prestige card, I don’t value the Gold card’s 4X restaurant category above what I get with the Prestige card.

See: Prestige rocks my wallet for 2019.

I bought a Samsung watch.

When I combine this watch’s Samsung Pay capability with my US Bank Altitude Reserve card, I earn 3X (4.5%) everywhere.  This lowers the relative value of 4X Membership Rewards at grocery stores to only .5% compared to my best alternative.

See: 3X everywhere, on my wrist.

I signed up for the Ebates Visa.

One of the advantages of earning 4X Membership Rewards at grocery stores with the Amex Gold card rather than 3X with the US Bank Altitude Reserve is that there is less danger in getting shut down by Amex than by US Bank when buying gift cards at grocery stores.  With the Ebates Visa tied to a Membership Rewards Ebates account, I can earn 4X Membership Rewards buying gift cards from home.  That is way preferable to frequent trips to the grocery store.  Plus, there’s no need to worry about the Gold card’s $25K per year limit on 4X at grocery stores.

See: Ebates Visa with Membership Rewards. Everything you need to know.

My new Amex Gold worksheet

Here are my updated values:

  • $120 Dining Credit. If I could buy this as a membership, I’d pay: $80 now $60
  • $100 Airline Fee Credit. If I could buy this as a membership, I’d pay: $80 (unchanged)
  • 4X at Restaurants (worldwide as of June 6):
    • Weekly restaurant spend: $150 (it’s probably much more than that actually)
    • X 52 =  $7,800
    • X .01 = $78 now $0 (I earn more points with my Prestige card)
  • 4X at US Grocery Stores (up to $25K):
    • Weekly grocery spend: $200
    • X 52 =  $10,400
    • X .02 = $208
    • X 0.005 = now $52
  • Total annual value: $60 + $80 + $0 + $52 = $192

$192 is less than the card’s $250 annual fee, so the Amex Gold card is no longer a keeper for me.  When the next annual fee comes due I’ll call to cancel.  If they offer a retention deal worth significantly more than $58 ($250 annual fee – my $192 value estimate), then I’ll keep it another year.  Otherwise, bye bye Gold card.

Does the Amex Gold still shine for you?

Just because the Gold card has lost its spot in my wallet doesn’t mean that it’s wrong for you.  It is still the best card for US groceries if you spend more than $6K per year.  And it’s still one of the very best cards for restaurants (worldwide as of June 6).  To get an idea if it’s worth the $250 fee for you, fill out the worksheet below in order to estimate the card’s annual value.

  • $120 Dining Credit ($10 per month at various restaurants and food delivery services). If I could buy this as a membership, I’d pay: ____________
  • $100 Airline Fee Credit. If I could buy this as a membership, I’d pay: ____________
  • 4X at Restaurants (worldwide as of June 6):
    • Weekly restaurant spend: ____________
    • X 52 =  ____________
    • X .01 = ____________
  • 4X at US Grocery Stores (up to $25K):
    • Weekly grocery spend: ____________
    • X 52 =  ____________
    • X .02 = ____________
  • Total annual value: ____________

If the total annual value for the Amex Gold card exceeds $250 by a considerable margin, then you should consider getting this card, or keeping it long term if you already have it.

You can find more info about the Amex Gold Card here.

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