|Big bonuses in popular categories. Get 3X points on airfare and 2X points at restaurants, grocery stores, and gas stations. (Restrictions apply.)
$100 travel credit. Each year you can get $100 in statement credits when you use your card to pay for checked bags, change fees, and in-flight purchases.
Transferable points. Membership Rewards has more transfer partners than any other bank card, making it easy to use your points for award travel.
|Large annual fee of $195. However, many people make purchases in bonus categories, and Amex Offers can help you offset the cost.
Few benefits. Some other expensive travel rewards cards include perks like insurance, lounge access, and checked bags. Not this one. It’s all about the points.
Is This Card Worth the $195 Annual Fee?
Cards with high annual fees aren’t automatically a bad deal, but you should be aware of how you plan to use the card and if you’ll earn enough rewards to make the fee worthwhile. In addition, consider other benefits like statement credits, discounts, and bonus points that let you earn rewards faster than with other cards. Not all points are worth the same: a cash back card might be simple to use, but miles and points are sometimes easier to leverage for great travel rewards.
The American Express Premier Rewards Gold card earns Membership Rewards points, much like other Amex cards not affiliated with a specific airline or hotel. You’ll get 3 Membership Rewards points per dollar spent on airfare (purchased directly from the airline); 2 points per dollar spent at restaurants, gas stations, and supermarkets in the U.S.; and 1 point per dollar on all other purchases.
Most cash back cards earn between 1-2% of the amount spent. When redeemed for travel, Membership Rewards points are usually worth about 1.5 cents each, which means you only need to spend a little over $1,000 a month to earn enough rewards to offset the $195 annual fee. If you’re also making purchases in categories that earn a bonus, you’ll come out well ahead.
Plus, be sure to log onto your account to view Amex Offers, which include discounts like $200 off a $1,000 purchase from Delta or $15 off a $50 purchase from Williams-Sonoma. These deals are constantly updated, and you can only use them if you have an American Express card. Sometimes, Amex Offers is worth paying the annual fee all by itself.
How Membership Rewards Points Work
You can redeem your Membership Rewards points directly through the Amex website to book almost any flight. However, this option only gives you about 1 cent per point in value. (If you have another eligible Amex card, there might be offers that let you get more value, since all of your Membership Rewards points will be pooled in one account.)
Transferring your Membership Rewards points to a partnering airline loyalty program might be better. Most airline loyalty programs have limited award inventory, but when you do find a flight you can usually get a better value. This is because the ticket probably costs a lot more relative to the miles you need to redeem.
An international first class award, for example, would probably cost about 120,000 miles round trip or $10,000. That’s a value of 8.3 cents per mile. You can only get that value if you transfer to an airline loyalty program first and find an available award. (Pay attention to the transfer rate, since each airline is different.)
Booking through the Amex website would let you pick almost any flight for sale, but a $10,000 ticket would cost 1,000,000 points. It’s a trade-off between convenience and value. The difference is less extreme for business class, and not always relevant for economy class.
Participating Airline Loyalty Programs
Current transfer partners for Membership Rewards include:
- Air Canada (Aeroplan)
- British Airways (Avios)
- Cathay Pacific (Asia Miles)
- Delta Air Lines
- El Al
- Air France/KLM (Flying Blue)
- Hawaiian Airlines
- Singapore Airlines
- Virgin Atlantic
You will be asked to pay a tax of $0.0006 per point, up to a maximum of $99, when you transfer Membership Rewards to a U.S. frequent flyer program. For example, a $60 charge applies if you transfer 100,000 points to Delta Air Lines. This offsets certain taxes. No tax applies to other transfer partners.
Membership Rewards points can also be transferred to a couple of hotel loyalty programs, including Hilton Honors and Starwood Preferred Guest. However, these transfer rates are generally a poor value and not something I recommend.
Other Redemption Options
You can also redeem your Membership Rewards points for a statement credit, or a discount off purchases at Amazon.com. However, these are rarely a good value. Avoid these options if at all possible.
Earning Membership Rewards Points
In addition to the points you earn from a promotional sign-up bonus and on-going purchases, you may be provided with a chance to earn more Membership Rewards points through exclusive offers. For example, some Amex Offers include a few thousand points when you make a purchase, rather than giving you a statement credit. You might also receive a targeted email offering you some points if you refer a friend or if you accept paperless billing.
Keep in mind that once you transfer Membership Rewards points to an external loyalty program, it is impossible to get them back. All transfers are one-way.
Sharing and Combining Points
If you already have another card from American Express that earns Membership Rewards points, you will likely find that all of your points are consolidated in a single Membership Rewards account. This is good news because it makes it easier to earn (and redeem) a large number of points for bigger rewards. Also, if you happen to cancel one card the points will still be available as long as you have another Membership Rewards-earning card still open.
However, you cannot directly share your Membership Rewards points with another person. What you can do is add an authorized user to your card (the first five are free). When transferring points to an external airline loyalty program, you have the option to transfer them to your program account or the account of an authorized user. This might be helpful if that person already has a large number of miles with a particular airline. Again, more miles or points in one account usually makes it easier to use them for big rewards.
Other Travel Benefits
Lounge Access: Although this card does not include complimentary lounge access, it does provide the option to pay $50 for one-time access to the American Express Centurion Lounges at select airports.
Elite Status: No elite status is provided.
Car Rental Insurance: When you use this card to pay for a car rental, you’ll get secondary insurance with a limit of $50,000 on rentals under 30 days. You may choose to enroll in a separate program that offers primary coverage with a limit of $100,000 on rentals under 42 days. This costs $25 per rental and will apply automatically to every rental once you enroll.
Trip Cancellation/Delay Insurance: No coverage is provided.