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American Express is getting creative with its latest offer for the Premier Rewards Gold Card. The new (targeted) offer is for 40,000 Membership Rewards for $2,000 spend and an additional 25,000 Membership Rewards when you spend $2,000 between July 15th and October 15th of 2017. Here’s what you should know about this offer.
You’ll need to pay the annual fee
This offer requires you to hold on to the card for at least one year. Recall, the $195 annual fee is waived the first year but if you’re trying to obtain this bonus you’ll have to hold on to the card for over a year and will thus be hit with the $195 annual fee.
American Express is changing its refund policy for annual fees so that they will no longer allow for prorated refunds. According to the terms set to be put in effect, you should still be able to get a refund if you canceled “within 30 days of the Closing Date of the billing statement on which that fee appears.”
Thus, if you applied for this offer next month (assuming it’s still available), I’d venture to guess that you would have time to meet the $2,000 spend in July of 2017 and still cancel within 30 days of the closing date of the billing statement that will have your $195 fee. That should also be enough time for your additional 25,000 Membership Rewards to hit. Personally, I like the Premier Rewards Gold Card enough not to cancel it but for those who are adverse to paying annual fees, this might be an option.
Compare this offer to other offers
The standard Premier Rewards Gold Card offer is for 25,000 Membership Rewards but there are targeted offers for 50,000 Membership Rewards that you can often get to show up with Google Chrome Incognito. The best offer which I took advantage of was for 50,000 Membership Rewards for $1,000 worth of spend. There’s also a 75,000 offer but that is extremely targeted and unless you’re okay with potentially waiting years for it to pop up, I don’t think you should consider it.
Thus, the new sign-up bonus offers 15,000 more Membership Rewards than the best reasonably obtainable offer but requires you to pay the annual fee of $195.
Retention offers factored in
With an offer like this you’ve got to factor in retention offers. The standard retention offers for the Premier Rewards Gold card are usually these two options:
- $50 statement credit plus an additional $50 when you spend $500
- 2,500 Membership Rewards plus an additional 5,000 when you spend $1,000
You can get retention offers for much more but those higher offers are typically given to more established customers with higher spend put on their credit card.
So let’s say you jumped on the 50,000 Membership Reward offer for spending $1,000 and then a year later you gained an additional 7,500 Membership Rewards with a retention offer.
That means your earning would be 57,500 Membership Rewards for $2,000 worth of spend and you’d be paying the $195 annual fee.
The way that this new 65,000 offer is designed, it seems like it might be difficult to get a retention offer after the first year because American Express will already be granting an additional 25,000 Membership Rewards for $2,000 spend. It seems odd that they might offer a retention offer in addition to the second part of the bonus (that mirrors some previous retention offers) but you never know.
Let’s assume that you won’t get a retention offer and your earnings with the new offer would be 65,000 Membership Rewards for $4,000 worth of spend and you’d be paying the $195 annual fee.
So that comes down to 57,500 Membership Rewards for $2,000 worth of spend vs 65,000 Membership Rewards for $4,000 worth of spend. Of course, this assumes you are offered a retention offer with the 50,000 offer and not given one for the 65,000 offer so the result could be quite different.
Assuming things do work out this way, I’m not sure that the additional 7,500 points are that much better to warrant waiting a full year to obtain them. I don’t think the new offer is a bad offer at all, it’s just not so good that I’d be telling everyone to jump on it ASAP.
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Daniel Gillaspia is the Founder of UponArriving.com and creator of the credit card app, WalletFlo. He is a former attorney turned full-time credit card rewards/travel expert and has earned and redeemed millions of miles to travel the globe. His content has been featured in major publications such as National Geographic, Smithsonian Magazine, Forbes, CNBC, US News, and Business Insider. Find his full bio here.