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In mid-November last year (2018) – American Express announced the biggest devaluation to the points-earning program that we have ever seen. It essentially meant that points were being devalued by around 50% this year on the 15thApril thus making it twice as hard to earn points to redeem for premium cabins. 

Also to add to insult was the devaluation of Krisflyer (24thJanuary, 2019) – it costs approximately 10% more to fly on business class.

After more than two months of digesting the changes and analyzing my options - I will explain what is occurring in my opinion to the main cards for Amex and my recommendations going forward. 

American Express Platinum Edge

The Platinum Edge is a constant staple for points-earning enthusiast with the current points earning rate of 3 Amex points per dollar spent at supermarkets, 2 points per dollar at petrol stations and 1 points for everything else. But be wary of government charges that will only award you 0.5 points per dollar. Each Amex point is equivalent to one frequent flyer point

This card allows you to transfer points to several different frequent flyer programs including Singapore Airlines Krisflyer, Virgin Australia’s Velocity and Cathay Pacific’s Asia Miles. But note that this card does not transfer to the Qantas Frequent Flyer program.

On April 15th– the rates will reduce to 1.5 frequent flyer per dollar at supermarkets & petrol stations and 0.5 points for all other spend. Now comparatively – this is still better than 99% of other cards out on the market earning points. I would recommend keeping this card as most people will go and shop for groceries (this excludes Aldi Supermarkets) and fill up at petrol stations.

The annual fee is $195 but is offset by a $200 annual Amex Travel Credit.

If you apply through the referral link below you will also receive 10K Amex points – compared to if you were just to go and apply at the Amex website direct which currently does not give you any signup bonuses (as of 28thJanuary 2019). 

http://amex.com.au/refer/lindatG5Dq

Note:You will only receive the sign-up bonus if you have not held an American Express card in the last 18 months (as the primary card holder). Bank Issued Amex cards do not count to the criteria (e.g. Westpac-WBC, CBA). Also I may receive a referral bonus as well if you sign up through this card.

American Express Explorer Card

This Amex card was introduced in 2016 and has been beneficial to most cardholders. This card essentially awards you equivalent to 1.5 Amex/frequent flyer points per dollar spend on majority of purchases. If you were to own just one Amex card – then this would be the one I would recommend as you would not have to think about which card to use when shopping or paying for bills.  

As of April 15th, 2019 though – this rate will be reduced to 1 Amex point (or equivalent to 1 frequent flyer point).  This is a 33% reduction – but is actually still better than other credit cards out there. It has the same transfer airlines as the Amex Platinum Edge card. Yes there are other Visa/Mastercards out there which still give you 1 frequent flyer point per dollar – but this is up to $1000 or $2000 – but then reduces to 0.5 frequent flyer points per dollar after you have spent that amount for the month. The Amex Explorer card does not have a cap on the points you can earn.

Plus the Amex Explorer card can transfer to the Krisflyer program which provides the best Business Class award availability in my opinion exiting out of Australia to Asia. Once you are in Asia – then you can use other frequent flyer programs (or even still use the Krisflyer program as well) to fly to other continents/cities around the world.

The annual fee is $395 but this is offset by $400 Amex Travel Credit. 

Currently the Explorer card uses the “Gateway” points program. This means the conversion ratio is 4:3. So transferring 40K Amex Gateway points will equate to 30K Velocity points or 30K Krisflyer points. The calculations above I have all calculated is in normal Ascent points. 

Below is a referral link for the Amex Explorer Card. If you sign up through this link – you will receive 60K Amex Gateway Points (equivalent to 45K Amex Ascent/normal) points. If you sign-up directly to the website – then you will only receive 50K Amex Gateway points (equivalent to 37.5 Amex Ascent/normal points). 

http://amex.com.au/refer/yiuhoh5XLM

Note:You will only receive the sign-up bonus if you have not held an American Express card in the last 18 months (as the primary card holder). Bank Issued Amex cards do not count to the criteria (e.g. Westpac-WBC, CBA). Also I may receive a referral bonus as well if you sign up through this card.

American Express Platinum Charge Card

This card has recently increased the annual fee from $1200 to $1450 which has made it much harder for the normal spenders to justify keeping this card.

It has increased the annual Amex Travel Credit from $300 to $450 and has re-introduced the Accor Plus program (worth around $400). So this is providing $550 more value then the increase of $250 to the annual fee.

Currently you will earn 3 Amex points per dollar spend at restaurants/cafes, 2 points per dollar on travel/overseas transactions and 1 point for everything else (government charges are 0.5 points per dollar earned).

As of 15thApril 2019 – this will all reduce to 1.125 frequent flyer points per dollar spent. To people who have used this card to maximize points earned at restaurants, travel and overseas transactions – this is a big drop – up to 62.5% drop for restaurants. But it will earn you slightly more points per dollars for other spend.

I have outlined the other benefits of the Platinum Charge card in my previous post (http://www.flyingfirst.com.au/14-credit-card/129-2017-credit-card-strategy-updated.html) so will not outline them here. 

Below is a referral link for the Platinum Charge card. You will receive 90K Amex points on sign-up(need to spend $3000 in the first 3 months). If you were to sign up to Amex website directly – you will only receive 80K Amex points

http://amex.com.au/refer/yiuhohNR9k

Note:You will only receive the sign-up bonus if you have not held an American Express card in the last 18 months (as the primary card holder). Bank Issued Amex cards do not count to the criteria (e.g. Westpac-WBC, CBA). Also I may receive a referral bonus as well if you sign up through this card.

Amex Card Conclusion

There is no way around it – the devaluation is a huge detriment to anyone trying to accumulate their points to redeem flights. My recommendation though would still be for people to use their Amex cards to earn and stack their points as this is still better than any of the Visa/Mastercards out there on the market. The range of frequent flyer programs that you can transfer to is still much better than being able to transfer to Qantas or Velocity only.

For majority of people after post-devaluation– I would recommend a combination of the Explorer card and Platinum Edgecard for their American Express spend. Yes the Amex Platinum Charge card has an earn rate of 1.125 frequent flyer points compared to the Explorer card which only earns you 1 point – but the difference in the annual fee of $1450 to $400 is too great to justify for most people.

This would mean with the Explorer/Edge Card Combination – I can mostly get 1 point per dollar and then 1.5 points per dollar for supermarkets/petrol. 

If you only wanted 1 Amex card – then my recommendation is the Amex Explorer card – this is pre and post-devaluation. This is still the card that I believe most people will benefit on as it will net them 1 point per dollar on most transactions – thus not having to think about which card to use. 

Tips for increasing your points pre-devaluation to prepare for post-devaluation

  1. Remember to transfer your points out of your Amex account to your nominated frequent flyer program before the 15thApril!!!! Otherwise you will lose half the value of your points. Unless you are on the Platinum Charge card where they will double your points (so keeping the value) or if you have received a letter stating that your points will double on a particular date – thus retaining your value again. Please note the conditions of the frequent flyer program that you are transferring to as there is a deadline of when the points will expire if not used. Krisflyer for example has a deadline of 3 years for the points to be redeemed.
  2. Look at purchasing Woolworths or Coles egift/gift cards with your Amex Platinum Edge to earn 3 points per dollar before the devaluation. Possibly a week before 15thApril – look at purchasing enough gift cards for at least 3 months for groceries – this will net you triple points. Look at your own spending habits to determine personally how much you should buy ahead. Consider how much you are willing to spend ahead of time compared to if you had this amount in your own savings offset account to save on interest.
  3. Look at paying off your council rates, water bills, insurance before the 15thApril. So look at the bills that are potentially coming in the 3 months after the devaluation date – this will earn you the points on the current pay. Look for bills that allows you to use Postbillpay which you can then pay via Paypal. Paypal allows you to link your Amex cards. If you link your Amex Explorer card – then you will possibly earn 1.5 frequent flyer points per dollar pre-devaluation. 
  4. Go to Woolworths and Coles – have a scan through the gift card section. If you are looking for a new washing machine or TV for example – look at the cards that provide this. This could be JB Hifi or The Good Guys. If you purchase these gift cards – then it will net you triple points on Amex Plat Edge – compared to only 1.5 points per dollar post-devaluation.
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