I have had my American Express gold card for nearly two years and after
carrying it with me every single day I've uncovered some hidden quirks so
today let's take a refreshed look at the American Express gold card because
I'll tell you right now that my opinion on this product has definitely changed
I have had my American Express gold card for nearly two years and after
carrying this card with me every single day I've uncovered some hidden quirks so today
let's take a refreshed look at the American Express gold card because I'll tell you now
that my opinion on this product has definitely changed. what is going on
everyone I hope you are all having a fantastic day. So I've made a ton of videos on the American
Express gold card and from the start I'll tell you that of the many many cards that I have,
the gold card is one of just two products that I carry with me every single day. I love the $120
in Uber cash credits as well as the $120 dining credit that can be used at select locations and if
you're able to use those two credits alone then your effective annual fee drops from $250 per
year to just $10 per year. But while that sounds great on paper, that perfect world example has not
been my real world experience. We'll circle back to those credits in a seconds but the
gold card also offers four points at restaurants worldwide including takeout and delivery services,
four points at us supermarkets on up to $25,000 per year, three points on flights booked
directly with airlines or through the American Express travel site and one point on all other
purchases and just for the sake of simplicity let's establish from the start that one point
equates to one cent of value meaning four points per dollar is the equivalent of 4% cash back at a
bare minimum redemption value. So those are decent point multipliers and as someone who spends a ton
of money on dining, four points per dollar on restaurants worldwide has been absolutely
amazing especially considering this card has no foreign transaction fee and I spent three months
this past year traveling abroad earning 4 points per dollar on restaurants every single day meaning
those points really started to add up. You of course have the other cookie cutter benefits
that come with most credit cards of this caliber nowadays like car rental loss damage insurance,
access to the American Express hotel collection, countless shopping benefits and discounts but a
bulk of the benefit and justification of that annual fee comes from the point multipliers and
the two credits that I mentioned earlier. Now the gold card of course offers a decent signup bonus
that is usually between 60 and 75,000 points depending on when you apply and what targeted
offer you're able to get but at a bare minimum you should be looking at 60,000 points if you spend
$4000 in the first six months and again at 1 cent per point that means 60,000 points is worth $600
when redeemed so that alone technically covers your $250 annual fee for the first two years. OK
but circling back to those 2 credits which again are $120 in Uber cash and $120 as a dining credit.
First of all let's clarify that these credits are given to you in the form of a $10 statement credit
towards applicable purchases each month meaning if you go on just one or two trips per year then
you're likely not going to be able to redeem the full value of those credits all at once and that's
where things start to fall apart for me. You see the only way to truly get a net benefit here is if
you are regularly using Uber or Uber eats every single month and therefore are able to put that
$10 monthly statement credit towards purchases that you would be making anyways. Same thing
applies to the dining credit which by the way is only applicable at Grubhub, cheesecake factory,
select Shake Shack locations and a few other restaurants but otherwise it doesnt apply.
So when looking at these high annual fee credit cards which I would definitely put the gold card
in that category at $250 per year, what you really need to calculate is what's called the effective
annual fee and this is simply the annual fee which in this case is $250 and subtracting the credits
that will replace purchases that you're already making. The reason that's important is if a
product gives you a $10 credit for Starbucks each monthbut you're like me and you wouldn't be caught
dead at a Starbucks otherwise then even if you go and are able to redeem that $10 credit for
free coffee, it's not actually replacing anything in your budget and therefore you're not getting a
net benefit out of that credit. So in the case of the gold card, if you are regularly ubering
one or two times each month then using that $10 monthly credit shouldn't be a problem but if
you're like me and you live in more of a suburb or rural area and you aren't using Uber on a regular
monthly basis then that credits is going to be difficult to effectively use. And when it comes to
the dining credit, again unless you regularly use Grubhub or you live near one of those applicable
establishments like cheesecake factory or Shake Shack then getting a net benefit out of that
credits is gonna be next to impossible. In fact in the two years that I have had my gold card,
if you remove the welcome bonus that I got in the first year, my effective annual fee each year was
well over $150 because I am not able to use either of these credits in an effective way. Now I want
to be clear that that is strictly a case by case situation and in my case because of where I live
and my lifestyle I'm not able to take advantage of these credits and therefore the gold card is
becoming increasingly more difficult to justify without getting some kind of retention offer. But
I’ll reiterate that if you regularly dine at any of those restaurants I had mentioned or regularly
use Uber or Uber eats then you shouldn't have any issue using those credits to replace a cost
that you are likely going to incur no matter what. Additionally, I've gotten really good
at maximizing my point redemptions to the point that I usually am getting three to five cents per
point which is significantly more than the 1 cent per point that your average user is looking at.
During my recent travels abroad I paid for plane tickets to and from Europe for my wife and I,
multiple tickets between countries, multiple hotel stays and several other travel expenses
using nothing but American Express points but that took hours of planning and research and transfer
partners and point multipliers and quite honestly it took me years to learn how to maximize those
points which brings me to another argument that the gold card has a bit of an identity crisis.
It's obviously not a cash back credit card since it's giving you points but it's also not exactly a
travel credit card because it doesn't give you airport longe access or other premium travel
benefits that come with similar products. And because of that it's not really great at anything
yet you still have to deal with the complexities of redeeming your points and ensuring that you
are maximizing their value. Whereas your average user could just get a flat cash back credit card,
get a decent percentage back in certain spending categories and not have to deal with the headaches
of point multipliers and transfer partners and maximizing point values and all of that
nonsense that most users probably don't care about. And that's coming from a guy who loves
credit card points and knows how to use them really well. S that brings us to a decision that
may shock a lot of you but as of today I will be replacing my American Express gold card in
my wallet with a new product that I've alluded to several times in recent videos which is the
American Express blue cash preferred card. Now the purpose of today's video is not a
comparison between these two products and if that is something you'd like to see then let
me know down in the comments section but the blue cash preferred costs significantly less
at just $95 per year and is offering 6% cash back at US supermarkets and select streaming
services. Now the cap on the cash back is much lower at just $6000 per year however it's just
my wife and I for now and seeing that our monthly grocery budget is roughly $500, that would equate
to exactly $6000 per year which means we're looking at 6% cash back on all of our grocery
store purchases for the foreseeable future. The blue cash preferred also waives the lower
annual fee for the first year but most importantly it's simple. You don't have to worry about points
it's just cash back that goes directly towards a statement credit meaning this is essentially
6% off groceries and streaming services and 3% off gas. For us it's a no brainer and if I was able to
better use the gold cards credits then this would be a more difficult decision and that is something
that you will want to consider when looking at your credit card usage. Now full transparency
I will not be closing my gold card and the simple reason for that is they let you earn
55,000 points per year by referring friends so that alone is worth $550 per year to me because I
have this YouTube channel so I say that just to be fully transparent but that's obviously an anomaly
that isn't going to apply to your average user. So it's been a good two year run with the gold card
and while I will miss the flex of dropping a heavy gold card on the table at dinner, earning 6% cash
back at the grocery store feels a little bit better right now with food prices soaring. But
again this is a decision that makes sense for my credit card usage and this likely will look
slightly different for your financial situation. To learn more about the blue cash
preferred card you can check out this video or if you want to see the ultimate American Express
credit card tier list you can check out this video. As always thank you so much for your time
take it easy and I'll see you in the next one! okay