The Most Underrated Credit Card?

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Update: The Amazon Prime offer is expired.

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American Express is a DansDeals.com advertiser.

A few weeks ago a fellow blogger asked my opinion of what is the most underrated credit card.

It’s always tough to single one card out.

For card benefits I answered with the United Explorer. It’s no secret I’m a fan of the card as I wrote about in this post.

But for spending I wrote that it’s the Amex EveryDay Preferred Credit Card from American Express

Assuming you can make 30 transactions per month, it offers 1.5 points per dollar everywhere, 3 points per dollar on gas and Uber, and 4.5 points per dollar on groceries.

It’s really even more than that, as Membership Rewards often offers bonuses for point transfers. Currently there is a 35% bonus for transfers to Virgin America and more crucially, a 40% bonus for transfers to British Airways.  In the past transfer bonuses to BA have ranged between 20-50%.

With a 40% transfer bonus, you have effectively earned 2.1 BA Avios per dollar spent everywhere, 4.2 Avios per dollar spend on gas and Uber, and 6.3 Avios per dollar spent on groceries.

If you value BA Avios at 1.5 cents each that’s like getting 3.15% back everywhere, 6.3% back on gas and Uber, and 9.45% back on groceries.  It’s really easy to get that kind of value out of a BA award flight. If a paid one-way flight is $67 and you use Avios for it then you’ll have achieved this value.  If the paid flight is $134 then you can double those values in each of those categories. No close-in fees and $5.60 flight cancellations only sweeten the pot.

Spend $715 on groceries and you’ll get 3,218 points. Transfer them to BA during a 40% bonus and you’ll have enough Avios for a free flight. The grocery bonus is capped at $6,000/year (which would earn 27,000 points).

Fly one-way from NYC to Montreal or Detroit this week and a ticket on American will set you back up to $800. Or you can use 4.5K BA Avios. That means the points reward from buying $715 of groceries can be worth more than you paid for the groceries! And it’s why I love real miles over cashback cards because the cost of an award isn’t tied to the actual cost of the ticket. That applies even more so on business and first class awards where awards can also be very lucrative.

If you don’t have 30 transactions in any given month you’ll only get 1 point per dollar everywhere, 2 points per dollar on gas and Uber, and 3 points per dollar on groceries. Just have your statement close on the first of every month and set your calendar to remind you on the 29th of the month to check your account to see how many transactions you made that month.

Even if you return an item it doesn’t subtract the original transaction.

The EveryDay Preferred card has a $95 annual fee, but that’s low considering it’s the only card other than the $395/year United Club card that gives 1.5 real airline miles per dollar everywhere. (Yes Ink cards can potentially earn more, but you’d have to first buy gift cards and then use those gift cards everywhere which will wind up costing you valuable purchase protections that credit cards offer).

The fee is also negated by the fee-free additional user cards you can get that each qualify for AMEX promotions such as Small Business Saturday.

It also offers 0% intro APR on purchases and balance transfers for 15 months. After that, your APR will be a variable rate, currently 12.99% to 21.99%, based on your creditworthiness and other factors.

The signup bonus is 15K Membership Rewards points plus 1 year of Amazon Prime for spending $1,000 within 3 months.

The Amazon Prime offer is a limited time offer. It will come as a code sent to you via email after you meet the $1,000 spend threshold. If you already have Amazon Prime the code will extend your Prime membership by a year.

Don’t want to pay an annual fee? You can downgrade the card to the non-preferred version of the card or you can apply for the fee-free Amex EveryDay Credit Card from American Express.  However that card only earns 1.2 miles everywhere and 2.4 points per dollar on groceries and Uber. On the plus side it’s the only fee-free card that can transfer points into real airline miles without having to first transfer the points to a card with an annual fee.

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50 Comments on "The Most Underrated Credit Card?"

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Mark

If I currently cancel my amazon prime which I paid $99 will I get prorated money back?

Tom

Would amex switch the amazon prime on the EDP for a $99 statement credit ?

AD

Dan, I got a united card targeted offer for 50+5 K. Any idea if that’s the best they offer or will offer more if I hold out?

Amusch

1) Any idea when the Prime offer ends?
2) can you make 30 $1 payments on Serve?

bbm

Great read.

1) Just got the amex plat and spg last month. Is it to early to apply for more amex cc’s? Credit score shld be 750+/-

2) If not too early which other amex card(s) do you suggest I do at the same time.

TIA

Berele

Hey Dan I got the card on your recommendation and I love it. There’s one thing I don’t have clear. If I make a transaction before the statement closes ( for example, in your case on the 29th or 30th of the month) and its pending and only posts after the statement closes, does it count as one of the 30 transactions? Thanks

Anonymous

Love u dan man

Don

If I get the edp card and I get the bonus offer of 15,000 deposited into my mr account and turn I downgrade the card to avoid the annual fee 1) will they take the extra 5,000 points back 2) is the annual fee pro rated

NJmacman

Why is this Amex card better than the Barclay Arrival Plus that gives you back 2.20% on all purchases?

lucky luke

@NJmacman: 1.5 Membership Rewards points is worth more than 2.2 cashback

shlomie

Dan
what card to you recommend to maximize matmid points for ElAl

Jb

Doesn’t the capital one card give 1.5 percent back with no annual fee as well?

JustMe

Great post Dan! Why can’t you apply for a 2nd card after about 8-10 months and then cancel the 1st one. You should be able to do this in perpetuity and never pay the fee. Better than downgrading.

Dan

@Mark:
Yes.

@Tom:
No.
But you can sell the Amazon Prime code. There’s a DDF thread for that.

@AD:
The best is 55K+$50.

@Amusch:
1. Rumor is that may be ending soon.
2. I don’t see why not.

@bbm:
There’s no defined time limit, you should be fine.

@Berele:
Glad you’re enjoying your card!

“To count purchases for this benefit, we use the date of the purchase. For example, if you make a purchase on the last day in your January billing period, it might not post to your account until your February billing period. If this happens, the purchase still counts towards your January billing period. In rare instances, a purchase may not post to your account for several billing periods. For example, extreme weather or other business disruptions may delay a merchant in submitting transactions to us. If a purchase posts to your account more than four billing periods after the purchase date, we count it for the billing period in which it posts, and not the purchase date.”

@Don:
They will not take back points and they will prorate the fee.

@NJmacman:
Did you read the post?
1.5 MR points are worth much more than that.

@shlomie:
This is a great card for El Al.

@Jb:
Those points don’t transfer to miles.
That $800 flight which costs about 3,000 AMEX MR points will cost 80,000 Capital One points.
You do the math.

@JustMe:
The fee is not waived for the first year.

Berele

Btw Dan, it’s worth pointing out to whom it may concern, the extra 50% points only post to your account 4-6 weeks after the billing period, so for people like me who would want to use all my earned points for the 40% BA bonus, unfortunately this little quirk in the posting can be annoying… and reps aren’t to helpful with speeding up the points for the 50% bonus unfortunately…

BBM

if i’m applying for this card which other amex cc’s do you recommend? already have the plat and spg

chaim

Dan, i have a new EDP card and got an addn’l card for wife. Is the points bonus for 30 transactions for each individual card? or the entire account. I’m looking at my primary card and it seems to be counting only charges on my card.

ericmedschoolgd

dan u forgot to mention the fact that its UP TO 6k year. …. not as lucrative as portrayed…but yes 24k aint too shabby

yy

Am I correct in assuming that I can get the card in my name and use the Amazon Prime code to extend my wife’s Prime membership?

amex

have the Amex gold business card and they billed me $175 they do not seem to wanna waive it or even part of it (they offered to downgrade to free card) we do over 15K a year on it any ideas? does it pay to close and maybe reapply a year later but what do I do with my MR points, thanks for your help

Yoely

Hi, Your wrote that the United and the sapphire are the best for car insurance, is it better than Amex Premium insurance or the same?

Yossi

What’s the most overrated credit card ?

njmacman

Got it. Thanks, Dan. Avios are great.

iahphx

If you could count on the Avios bonus, I would sign up for the card. But how often have they offered it lately? Once in the last year, maybe? You can’t really buy gift cards with the card, either, because you only get the bonus on the first $6000/year.

Not worth the wallet space or application, IMO. If this is the most “under-rated card,” there aren’t too many good, obscure cards!

Ari

This is slightly off topic but does 3BM only work with same bank? Or different banks as well?

Anonymous

I’ve done the math, Dan, and seem to be missing your point. For those of us who don’t fly and use miles we rely on points to sell. The value of you go to a good points buyer of chase or amex points is about 1.4. To 1.5 cents each. If capital one is offering 1.5 percent cash back, wouldn’t that make more sense for non flyers?

Dan

@Berele:
True, but there will be more bonuses in the future.

@BBM:
Delta?
Premier Gold?

@chaim:
Entire account.
The 50% bonus doesn’t post together with the base points.

@ericmedschoolgd:
Actually I did mention that, you just forgot to read it 😉

@yy:
Sure!

@amex:
You can apply for a card like Everyday to keep your points alive when you close the gold card.

@Yoely:
AMEX Premium is better than Chase in most countries, but AMEX premium costs $20/rental.

@Yossi:
Centurion 😀

@iahphx:
There has never been a year without the BA transfer bonus.
Seems reliable to me.

Most people overlook that there’s a card where they can effectively earn 2 BA miles per dollar spent everywhere.

What other card can say that?

@Ari:
http://www.dansdeals.com/archives/53213

@Anonymous:
Oy.

You earn 1.5-4.5 points per dollar spent on this card.

1.5 points times 1.5 cents each is a lot more than a flat 1.5%. Even more so on gas, groceries, Uber, etc.
And even more so when there’s a transfer bonus that increases the value of your points.

Of course if you fly the sky is the limit, but even if you sell this is far better off.

Mendy

@Anonymous: capital ones 1.5 cents back is good but what about getting upto 3 points per dollar spent that’s 3 times 1.5 cents!!!! If your a math genius then you might be able to figure out this formula😆😆

ericmedschoolgnd

@Dan: wow dan .. my apologies.. i owe u a bracha .. one day at shallots 😉

Mendy2

@Mendy: Lol, seems like everyone around here is a math genius. 3 is 2 times 1.5….
You’re making Mendys look bad

SNOW

well written .and clear

Li Zhang

I read the other bloggers’ reasoning on their pick of the most underrated credit card, it’s really not a surprise that once again Dan produced the best piece!

Gary

@Dan I tried to apply for the AMEX card using your link and it stated that if I am currently an AMEX card holder I may not receive the offer. This actually happened to me when I applied for the Platinum card, I never received the bonus because of my gold card. Thoughts.

Dan

@SNOW:
Thanks.

@Li Zhang:
Glad you enjoyed 🙂

@Gary:
Platinum and Gold are part of the same family.

You’ll get the bonus for this even if you have both of those.

amex

but the everyday card still has an annual fee, what am I gaining?

Michael

My wife applied for and got the card 2 months ago- noticed Costco was not crediting properly. FYI – buried in T & C’s it states warehouse clubs not allowed. Huge bummer

Nate

Costco was not crediting for what? I assume costco, Target, etc wouldn’t count as groceries but they should at least get 1.5 points per dollar.

mh

or using avios for day before flight from Florida back to NYC with prices that were over $600-$700!

If not for Avios, I would not have taken the $32 JetBlue flights out since I could not get return flights booked.

I always did not bother with your Avios points posts but now I am hooked!

Kate

@michael. Are you sure? I have been assuming I was getting the 1.5′. I knew it didn’t count as a grocery store. Is that what you mean?

Kate

But you still get 1.5 at Costco right? With the 30 purchases…

Danfan

Is target categorized as grocery or is it 1.5 on this card?

Dan

@amex:
My AMEX cards have a an annual refund thanks to SBS.

@Michael:
Huh?
Costco isn’t a grocery store if that’s what you’re saying.

@Nate:
Correct.

@mh:
Easy to get hooked on Avios 😀

@Kate:
@Kate:
Yes.

@Danfan:
1.5

amz450

if I’m considering a 2 or 3bm which cards would you suggest? BA? Amex everyday? amex gold? any others? (I already have chase sp,ua and freedom)

Norm Kurnick

I have the United Credit Card and have it linked to my account. I am still not able to view the 12,500 mile awards for the non-stop flights from LAX-JFK on April 12th. What’s up ? There are seats available on the flight so shouldn’t the 12,500 level be offered ?

Thank you…..Norm Kurnick

danfan

@ dan just spoke to amex rep they claim only charge cards with mr can transfer to avios but you say otherwise i trust your word over theirs which amex cc’s with mr can transfer to avios
P.s. i have amex blue and that doesn’t transfer

Eli

Hi Dan,
After a few month of work, I was finally able to get myself backdated by becoming an AMEX AU.
Now, when I log in to the website, it says MS ’06.
What happens now? Will the ‘Account Date Opened’ on my report change the next time they report the card? (eg. reporting balance)

Dan

@amz450:
3bm from what bank?

@Norm Kurnick:
You get expanded saver awards, not every seat.

@danfan:
Only non charge cards that transfer are everyday and everyday preferred.

@Eli:
Yes.

Eli

@Dan:
Thanks man!
That should give me a nice boost. I’ll also be opening a bunch of new Amices 🙂
Next think: A loan. (For the account mix. All I have now is CCs)
Do you think it’s a good idea? If so, have any specific recommendation?

bzjaffe

And the free EveryDay card is a great place to “hold” your MR points if you need to cancel your Platinum card, like I do.

S. Entin

Are the rental insurance and purchase protection benefits as good and reliable on this as on the Platinum?

Thnaks

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