Five reasons why you should keep your Amex Gold card after the free first year
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Last week I did a piece for This Is Money about the American Express Preferred Rewards Gold credit card, to help a reader who was unsure whether he should retain the card after the free first year.
You can read the This Is Money article here but I thought I would run through the key points here for the benefit of HfP readers in the same boat.
With the 2019 changes to the American Express sign-up rules, which mean that you can no longer cancel your Gold card and reapply six months later (you now need to wait 24 months to get a fresh sign-up bonus), it is worth thinking about whether holding the card long term is a better approach.
What are the benefits of signing up for Amex Gold?
The package you get for the first year of holding this card is excellent. You can’t deny that. Among the benefits are:
You don’t pay a fee for your first year
You receive 10,000 American Express Membership Rewards points after you spend £3,000 in your first three months. These convert into 10000 Avios, 10000 Virgin / Emirates / Etihad / Flying Blue etc miles, 20000 Hilton Honors points, 15000 Marriott Bonvoy points, 30000 Radisson Rewards points or many other things.
You get two free passes to get into selected airport lounges – the directory is here
Full details of the card, and the application form, are on the American Express website here.
In order to qualify for the sign up bonus, you cannot have held any personal American Express cards in the past 24 months. Cards issued by MBNA or Lloyds Bank do not count.
Note the interest rate information below:
Sign-up bonus and earnings rate:
- Get 20,000 Membership Rewards points when you spend £3,000 within 90 days
- Earn 1 Membership Rewards point per £1 spent
- Get a 10,000 points bonus if you spend £15,000 in a card year
- Earn double points on all airline and overseas spend
- Points transfer at 1:1 into Avios, Virgin and other airline schemes
Other information:
- Amex Gold is our recommended ‘first card’ for a miles and points beginner
- Get two free airport lounge passes when you sign up, and a further two each year
- After your two free passes, you can visit further lounges for a small fee
- You receive £120 of Deliveroo credit each year (24 x £5 credits)
- Annual fee: Free for the first year, £140 from Year 2
Representative 59.9% APR variable. Annual fee applies after the first year.
You will receive 20,000 American Express Membership Rewards points as a sign-up bonus on the American Express Preferred Rewards Gold card if you spend £3,000 within 90 days of signing up.
Membership Rewards points are hugely flexible, which is why we recommend this as the best choice for your first miles and points card. You can transfer them into Avios, Virgin Flying Club or other airlines (at 1:1) or into various hotels schemes, into Club Eurostar or use them for shopping vouchers.
To qualify for the bonus, you must NOT, currently or in the previous 24 months, have held any other personal American Express card.
You are OK if you had a supplementary card on someone else’s American Express account.
You are OK if, currently or in the previous 24 months, you have held a Business American Express card.
For clarity, you can still apply for the American Express Preferred Rewards Gold card even if you do not qualify for the bonus. You would still benefit from the two free airport lounge passes and the ‘no fee in Year 1’ offer.
American Express Preferred Rewards Gold comes with two free airport lounge passes. These allow either you and a friend, or yourself twice, to visit any lounge in the Priority Pass network. You make additional lounge visits for £20 per person. You receive an additional two free passes each year.
You earn double Membership Rewards points on all airline spend (made directly on an airline website) and all spend made outside the UK.
If you spend over £15,000 in a card year, you will receive an additional 10,000 Membership Rewards points when you renew.
Starting in May 2021, you receive £120 of Deliveroo credit each year. Amex will repay you £5 for the first two Deliveroo orders charged to your Gold card each month.
Other benefits include a 10% discount on Hertz car rentals and special deals at 350 selected hotels worldwide, where Preferred Rewards Gold cardholders receive a $75 in-hotel credit per stay.
What happens after Year 1?
After the first year, you need to make a decision about whether to keep the card or not.
Many people baulk at the idea of paying the £140 fee, especially if they are not used to paying fees for credit or charge cards. Whilst the easy answer to those readers who contact me would be ‘cancel’, it is worth looking objectively at the ongoing package – especially if you are not the sort of person who likes to churn his or her card portfolio regularly.
Good reasons to keep Amex Gold beyond Year 1
Reason 1: the annual bonus of 10,000 Membership Rewards points
If you spend £15,000 on the card in your membership year, you will receive a bonus of 10,000 Membership Rewards points about four weeks after you renew. In the most extreme case (ie you spend exactly £15,000 per year) this makes your earning rate on the card 1.6 Membership Rewards points per £1, made up of 15,000 base points and the 10,000 bonus points. This is an impressive earning rate – in fact, it would be the best earning rate of ANY travel rewards credit card.
Even if you are determined to cancel the card, it would be madness – if you had spent £15,000 – not to wait a month until the bonus arrives. You will get a pro-rata refund of the 2nd year fee when you cancel, which will only be about £12 by that point.
Reason 2: two more free Lounge Club airport lounge passes
You receive another two airport lounge passes when you renew. These are worth around £40. It would be odd to cancel your card at renewal if you knew you were travelling in the next month or so and could use the Lounge Club cards. Roll your Amex Gold over – you still have the option of cancelling later after your lounge visit.
Reason 3: you don’t need to empty your Membership Rewards points account
You keep your Membership Rewards points alive. If you cancel your Amex Gold, you will need to transfer your Membership Rewards points out. This gets rid of the main benefit of Membership Rewards points – flexibility. Keeping your Gold card means you can keep your Membership Rewards points account open and so keep all of your options for the points open. (One option to get around this is to open a FREE Amex Rewards Credit Card instead – I explain how to save your Membership Rewards points in this article.)
Reason 4: you retain access to the Amex Gold hotel programme
You retain access to the other, often forgotten, Amex Gold benefits. The most interesting is ‘The Hotel Collection’ programme – details here. This gives you an upgrade and up to $100 equivalent credit when booking a 2+ night stay at participating upscale hotels. Chains taking part include Radisson Blu, Omni, Kimpton, Hilton, Sofitel and many more. There is also a 10% Amex Gold Hertz discount, although I admit this can probably be matched by other deals you can access.
Reason 5: if you have no other Amex, you retain access to Amex’s valuable cashback deals
If Preferred Rewards Gold is your only American Express card, you retain access to the wide range of Amex cashback deals which are permanently available. Even if you do have other Amex cards, you can double up on deals which interest you if you have multiple cards available.
There are other smaller benefits too:
You retain access to the refer-a-friend programme which earns you 6,000 Membership Rewards points for each new American Express cardholder you sign up. You will receive the referral bonus even if the person you refer does not qualify for a sign-up bonus.
If you spend a lot on flights, the ‘double points on all airline spend’ benefit will add up. You don’t need to book via Amex Travel to get this, it is automatic for spending on all airlines.
There are other ways of accessing some of the benefits above, of course. The Amex Rewards Credit Card ……
Sign-up bonus and earnings rate:
- Get 5,000 Membership Rewards points when you spend £2,000 within 90 days
- Earn 1 Membership Rewards point per £1 spent
- Points transfer at 1:1 into Avios, Virgin and other airline schemes
Other information:
- Your best choice if you want a ‘free for life’ card which earns Membership Rewards points
- A good choice if you want to close a Gold or Platinum card but keep your points intact
- Annual fee: Free
Representative 24.5% APR variable
You will receive 5,000 American Express Membership Rewards points as a sign-up bonus on the American Express Rewards card if you spend £2,000 within 90 days of signing up.
Membership Rewards points are hugely flexible. You can transfer them into Avios, Virgin Flying Club or other airlines (at 1:1) or into various hotels schemes, into Club Eurostar or use them for shopping vouchers.
To qualify for the bonus, you must NOT, currently or in the previous 24 months, have held any other personal American Express card.
You are OK if you had a supplementary card on someone else’s American Express account.
You are OK if, currently or in the previous 24 months, you have held a Business American Express card.
For clarity, you can still apply for the American Express Rewards card even if you do not qualify for the bonus. You may want to do this if you are thinking of swapping your Preferred Rewards Gold or Platinum card for a free alternative, and would prefer to keep your existing Membership Rewards points balance alive.
American Express Rewards is the only ‘free for life’ American Express card which lets you collect Membership Rewards points.
We do NOT recommend this card if you would also qualify for the sign-up bonus on American Express Preferred Rewards Gold. The Gold card is free for the first year, comes with two free airport lounge passes and has a higher sign-up bonus of 10,000 points.
The best reason to get American Express Rewards is if you are coming to the end of your free first year with American Express Preferred Rewards Gold, or no longer want to pay the fee on The Platinum Card, but want to keep your Membership Rewards points intact.
…….. will keep your Membership Rewards points alive. I also accept that, if you don’t spend £15,000 per year to trigger the 10,000 bonus points, the maths probably doesn’t work unless you use ‘The Hotel Collection’ programme and the airport lounge passes.
If you do spend £15,000 to trigger the annual 10,000 Membership Rewards point bonus, however, there ARE merits for keeping your Amex Gold card open long term.
You can apply for American Express Preferred Rewards Gold here.
Want to earn more points from credit cards? – December 2021 update
If you are looking to apply for a new credit or charge card, here are our November 2021 recommendations based on the current sign-up bonus.
You can see our full directory of all UK cards which earn airline or hotel points here. Here are the top current deals:
British Airways American Express
5,000 Avios for signing up, no annual fee and an Economy 2-4-1 voucher for spending ….. Read our full review
British Airways American Express Premium Plus
25,000 Avios and the UK’s most valuable credit card perk – the 2-4-1 companion voucher Read our full review
American Express Preferred Rewards Gold
Your best beginner’s card – 20,000 points, FREE for a year & two airport lounge passes Read our full review
The Platinum Card from American Express
30,000 points and an unbeatable set of travel benefits – for a fee Read our full review
Earning miles and points from small business cards
If you are a sole trader or run a small company, you may also want to check out these offers.
American Express Business Gold
20,000 points sign-up bonus and free for a year Read our full review
American Express Business Platinum
40,000 points sign-up bonus and a long list of travel benefits Read our full review
British Airways Accelerating Business American Express
30,000 Avios sign-up bonus – plus annual bonuses of up to 30,000 Avios Read our full review
Capital On Tap Business Rewards Visa
The most generous Avios Visa or Mastercard for a limited company Read our full review
For a non-American Express option, we also recommend the Barclaycard Select Cashback card for sole traders and small businesses. It is FREE and you receive 1% cashback on your spending:
Barclaycard Select Cashback Credit Card
1% cashback and no annual fee Read our full review
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