Credit Card Review: American Express Everyday Preferred

Over the last couple of years, I have opened roughly 20 credit cards between myself and Kristin. It’s gotten us lots of points to travel for very little out of pocket and that’s the point, right? Kristin puts up with my antics of cycling cards in and out of her wallet, but I want to consolidate the amount of cards we have/use. I also have been learning more about Membership Reward points and since I think these can be a great value for us, I opened the American Express Everyday Preferred and I think this is going to be my new work horse! 

Credit Score Needed:
I would advise against playing this game if you have a credit score less than 700. There are cards to help you improve your credit score, if you are below 700.

Credit Karma list the average credit score for an American Express Everyday Preferred user at 715, with the typical low of 650. 

Not the best bonus in the world
Not the best bonus in the world

Sign Up Bonus:
This is where American Express really needs to step up on this card. The bonus on this card is lousy, but I’ll explain later why you should look past this bonus.

You ‘ll receive 15,000 Membership Reward points after spending $1,000 in the first 90 days, that’s a piece of cake.

**When this card first came out, Kristin had a targeted offer for 25,000 Membership Reward points and I thought it wasn’t worth my time. Well how wrong I was and now I get the card with only a 15,000 point bonus.**

Base earning rate
Base earning rate

Earning Rate:
This is where the card really starts to shine and I think makes it the best for earning Membership Rewards. The base earning rate for the Everyday Preferred is 3 points per dollar on grocery (up to $6,000 in a year), 2 points per dollar on gas and 1 point per dollar on everything else. 

That might not sound great at first, BUT once you hit 30 transactions in a month, you will receive a 50% bonus on your points! Their mobile app even has a transaction tracker to show you how close you are to reaching 30 transactions. Even better, if you make a purchase and have to make a return, that will not reduce your transaction total for the month. You won’t earn points on that transaction, which is expected.

That makes your earning rate 4.5 points per dollar on grocery (up to $6,000 in a year), 3 points per dollar on gas and 1.5 points on everything else.  Those are great earning rates!

I have been valuing Membership Rewards at 1.5 cents per point, but that is quite low for them. I now value Membership Reward points at 1.7 cents per point and that could still be a low value for them!

That means you’ll be earning 7.65% on groceries, 5.1% on gas and 2.55% on all other categories. 

Let’s look at the amount of points you could earn, according to the Bureau of Labor Statistic, on average American spending:

Category Yearly Spend without 50% bonus with 50% bonus
Gas $2,400 4,800 7,200
Entertainment $2,500 2,500 3,750
Groceries $4,000 12,000 18,000
Dining Out $2,600 2,600 3,900
Apparel $1,600 1,600 2,400
Transporation/Travel $6,600 6,600 9,900
Healthcare Expenses $3,600 3,600 5,400
All other expenditures $3,300 3,300 4,950
Total Points $26,600 37,000 points ( if you include the bonus it is 52,000 in year 1) 55,500 ( if you inlcude the bonus it is 70,500 in year 1)

If you were able to maximize the grocery category, you’d earn 27,000 points per year! This card was made for people who want to earn rewards and also want to not clutter their wallets with a bunch of cards to earn a lot of points.

For us this card makes sense, we drive up to 60 miles each way for work and we fill up with gas a few times per week. Our other largest expense is groceries and once we hit the 30 transactions per month (which is very easy for us), earning 1.5 points for non-bonus spend isn’t bad either!

Annual Fee:
The annual fee on this card is $95 and IS NOT waived the first year. This also does not go toward your spending requirement. There is a fee free version which earns 20% more points after hitting 20 transactions per month. The annual fee on the card is worth it if you can hit 30 transactions per month.

Foreign Transaction Fees:
Unfortunately, this card does come with foreign transaction fees and should stay at home if you go out of the US. American Express has slowly changed a few more cards to have no foreign transaction fees.

I think if they really want to this to be an “Everyday” card, they should really remove the foreign transaction fee.

Amex Offers:
This is probably one of my favorite perks of having American Express cards. These are a great way to save money on normal purchases or gift cards. So far this year, these have saved me close to $300 on items I was going to purchase anyway!

Amex Offers are offers that you can load onto your American Express card and when you make a purchase as described by the offer, you’ll receive a credit statement. This is an example of one I made a few months ago at Soap.com.

Some of these offers you can stack with shopping portals and make your savings even more!

Reward Program:
Using Membership Rewards for travel can be very valuable, American Express offers other redemption options but they aren’t that great of an option. You can use your points against charges, credit statements and booking hotels with their travel site, but you get about 0.6 cents per point.

If you redeem your Membership Reward points for gift cards you will redeem at 1 cent per points, occasionally they offer transfer bonuses. The exception is when you redeem for American Express gift cards, it is 0.5 cents per point (terrbile!). The only gift card that I am interest in is Airbnb, although I only receive 1 cent per point, it helps reduce my cost when booking with Aribnb.

If you were to book airfare through their travel site, you would redeem your Membership Rewards for 1 cent per point.

The real value comes when you transfer to one of their 17 airlines transfer partners and possibly their 4 hotel programs.

Airline transfer parnters
Airline transfer parnters
Hotel transfer partners
Hotel transfer partners

Not all their points transfer at 1:1 though:

  • 250 MR points = 200 Jet Blue points (5:4 ratio)
  • On October 1, you’ll need to transfer 250 MR points for 200 British Avios, (5:4 ratio), it is currently still 1:1.
  • 1,000 MR points = 20 El Al Israel Airlines miles.
  • Iberia Avios will be following the same British Avios starting on October 1. 250 MR points = 200 Iberia  Avios. (5:4 ratio)
  • 200 MR points = 100 Virgin American miles (2:1)
  • 1,000 MR points = 1,500 Hilton HHonor points. Redeeming for 1:1.5 ratio sounds appealing, but Hilton points are inflated and it might not be the best option. Still something to consider.
  • 1,000 MR points = 333 SPG points.

Occasionally American Express will have transfer bonus offers for their program. So, you should keep an eye our for those. They can be a great way to save points on your trips.

Other Benefits:

  • Extended Warranty
  • Travel Accident Insurance
  • Baggage Insurance
  • Purchase Protection
  • Road Side Assistance
  • Car Rental Insurance- secondary

Conclusion:
This card is great for people/families who don’t want to juggle many different cards to earn flexible travel rewards. If you spend more money at the grocery store and on gas this card could would be a great option for you. When you start adding in the extra perks of Amex Offers and the extra benefits American Express offers, the savings can really add up.

The American Express Everyday Preferred has moved into our wallets for the long term. For our spending habits, this card offers great earning potential. As I learn more about American Express transfer partners, I realize they offer more value than I previously thought.

Have you considered the Everyday Preferred? What’s your favorite American Express card?

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