Why I Dumped My American Express Platinum Card
I remember deliberating whether to get the American Express (AXP) Platinum card for over a year. What drew me to the card was access to most U.S.-based airport lounges, but I couldn't get over the mental hump of shelling out a $450 annual fee for a credit card. Still, after working through the economics, I got the card in 2011. Three years later, I've decided to drop the card and its hefty bill, and here's why.
What Lounge Access?
Access to airport lounges with the Platinum card is not nearly as good as when I signed up. I used to be able to use the American Airlines (AAL), Delta Air Lines (DAL) and US Airways airport lounges. However, within the past year, Platinum cardholders lost access to the American and US Airways lounges and are no longer able to bring complementary guests into Delta lounges. While the Platinum card still gives cardholders Priority Pass lounge access, in my three years as a cardholder, I never was able to use this benefit. American Express claims to be building its own airport lounges with free access for Platinum cardholders, but the only Centurion Lounges so far are in Las Vegas and Dallas.
Subpar Rewards Program
I never did like the Membership Rewards program. First, on the Platinum card, you're only able to earn one Membership Rewards point per dollar spent, which is less than many other credit cards (like the Chase (JPM) Sapphire Preferred card). In addition, I found the redemption value of each Membership Rewards point to be around one cent -- also less than other programs, such as the Starwood (HOT) Preferred Guest or Chase Ultimate Rewards programs.
As a result, during my time with the card, I never used my Platinum card for everyday purchases. It seemed weird to pay $450 for a credit card and not use it (or even carry it around), but it didn't make economic sense for me to use since I could pull out other credit cards and earn two points per dollar spent on most purchases.
$200 Airline Fee Hassle
Each year, the Platinum card agrees to reimburse cardholders up to $200 for incidentals and fees incurred on one airline. Example fees include checked bag fees and food purchases on flights. Because I don't regularly make these types of purchases, I took advantage of this benefit by buying four $50 airline gift cards a year, which I could use on flights that I would have purchased anyway. That was one of the big selling points that allowed me to initially make the card economics work. The problem: Toward the end of my relationship with the Platinum card, I found it to be a pain to track all the airline gift cards that I had accumulated, the balances of the various cards and the rules and restrictions for each airline.
No More Benefits to Reap
Over the last three years, I've basically sucked out all of the benefits that I could from the American Express Platinum card. I registered for Global Entry in my first year and got American Express to reimburse me the $100 signup fee. I've used the $200 airline fee credit each year to buy airline gift cards, and before I canceled the card, I enrolled in the Extended Payment Program to get 10,000 Membership Rewards points. There are really no other big benefits or signup bonuses that I'm eligible for, so all that I see staring in my face is the huge $450 annual fee and worsening benefits.
My Next Steps
Having canceled my American Express Platinum card, I'm going to rely more on my Chase Sapphire Preferred card and American Express Starwood card.
%VIRTUAL-article-sponsoredlinks%The Chase Sapphire Preferred card allows me to earn two points per dollar spent on restaurants, travel and transportation, which is where I spend most of my money. In addition, the card has no foreign transaction fees, so I can feel free to use it anywhere in the world that accepts Visa (V). The American Express Starwood card allows me to earn one point per dollar spent for most transactions and many more at Starwood properties. In addition, I've found each Starwood point to be worth at least two cents.
Both cards come with annual fees -- the Chase Sapphire Preferred is $95 a year and the American Express Starwood is $65. However, the total is around a third as much as the Platinum card fee of $450, and both cards essentially allow me to earn 2 percent rewards on most purchases. Now that's rich.
Roger Ma is a digital media professional, personal finance expert, and licensed real estate salesperson. He is the founder of lifelaidout, a personal finance blog that helps others identify value and save time, money, and energy in their everyday lives.