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American Express Gold Card Review: $125 Annual Fee vs Perks
Read more about American Express® Gold Card
American Express has long been known for its superior service and perks. But whether the annual fee is worth the investment for you ultimately depends on your spending habits and lifestyle. You probably wouldn’t tap into all of the card’s benefits. We've crunched the numbers below so you can see if the benefits you would actually use can cover the cost of the annual fee.
Pros and Cons
Excellent rewards card for cardholders who pay in full
The American Express Gold Card has an annual fee of $125, which is waived for the first year. This introductory period is a great opportunity to test out the card and see how many of its benefits you use.
American Express has been ranked highest in customer satisfaction in a nationwide study by J.D. Power and Associates. In fact, the issuer has held the #1 spot every year since the survey started five years ago.
The company offers sophisticated customer service through its website and mobile app, as well as great phone-based support. The ease of dealing with American Express is likely its biggest selling point – and one that’s hard to put a price on!
This card does come with some great benefits, including rewards programs, travel benefits, access to Gold Card Events, and more. Here is a breakdown of these benefits, along with their estimated dollar value:
Points can be redeemed for a number of rewards, including gift cards, merchandise, airfare, and other travel purchases. There are no blackout dates or travel restrictions, making rewards convenient for cardholders who travel often. The points do not expire.
You can also transfer your Gold Card rewards points to more than 20 frequent flyer and frequent guest programs, which means you can consolidate your points and redeem rewards sooner.
If you use your card for purchases totaling $1,000 each month, you will earn 12,000 membership rewards points annually. This number of points can be redeemed for $120 worth of gift cards to a number of popular retailers, such as Barnes & Noble, Lands End, and Groupon. You can even redeem your points for FarmVille credit! Be aware that if you want to redeem your points for a credit toward your account, you need twice as many points for the same dollar value.
Insurance through a car rental company can run $10 to $30 per day, so a week of car rental insurance can put you back $70 to $210. Before you factor in American Express' benefit for saving you this cost, check to see if you have rental coverage through your primary vehicle's insurance.
Membership in roadside assistance programs can run $50 to $100 annually. Prices for bundled baggage and travel accident insurance vary, but run approximately 4% to 8% of the cost of a trip.
Paying the $125 annual fee is a far better deal (and much easier) than buying all of these travel protections separately. But if you’re a traveler who doesn’t need or want these services, or if you rarely travel at all, these benefits won’t be a cost savings.
Gold Card Events
It’s difficult to calculate the dollar value of these benefits. To determine how much they are worth to you, ask yourself how much you would pay for them.
The Gold Card also comes with a purchase protection program. If you buy a product that is defective, stolen, or accidentally damaged, you can be covered for up to $1,000 per item.
The extended warranty program extends a manufacturer’s warranty for up to one extra year on eligible products. The value of this benefit depends on the product.
So, is it worth the fee?
To have the $125 annual fee be a wise investment, you will need to charge more than $1,050 to your card each month and redeem your points for gift cards or charge less and use some of the other benefits.
The Gold Card is an especially good fit for people looking for affordable and simple travel protections or access to big-name events. With the introductory no annual fee offer for the first year ($0 introductory annual fee for the first year, then $125), you’ll be able to see for yourself whether the Gold Card is right for you.
(Editing by Erin K)
Disclaimer: This content is not provided or commissioned by the company whose products are featured on this site. Any opinions, analyses, reviews or evaluations provided here are those of the author's alone, and have not been reviewed, approved or otherwise endorsed by the Advertiser. This site may be compensated through the Advertiser's affiliate programs.
Disclaimer: This content was first published on July 30, 2011. This content may have been updated on March 22, 2013. Information including APR, terms and benefits may vary, be out of date, or not applicable to you. Information is provided without warranty. Please check American Express website for updated information.
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