Benefits of the American Express Platinum Card
Usually around here, I'll take my Wednesday piece to break down a key financial topic or help you understand the financial world around you, breaking down things like "why stock markets crash" or "why Bitcoin might hit $5 million in a few years." However, it has become really clear to me that many people, especially Millennials and Gen-Z, just don't understand credit cards.
We usually fall into two buckets: no credit cards, or way too much credit card debt, and both are extremely unfortunate. Today, I'm going to give a quick primer on why you need a credit card, why you should have a credit card tailored to how you spend, and then review one of the most prestigious consumer credit cards on the market: The Platinum Card from American Express. Let's go.
What is a Credit Score?
Credit is effectively your measure as a person, provided as a score that's set on a scale of 300-850. Like the SAT, you do get a certain amount of credit for just showing up and signing your name. However, unlike the SAT, you don't get to superscore, and credit scores can directly affect pretty much everything in your life.
To most people under the age of 40, "credit" is an extremely dirty word. We've grown up around the media telling us we have too much debt, especially on our credit cards where the interest rates can hit over 20%. You use the card, overspend and then don't pay everything back on time. In return, you get charged an interest rate, which continues to compound until you declare bankruptcy or fake your own death.
In truth, credit cards are actually extremely helpful tools, if you use them correctly. Why? Because they give you credit! And that's not the boneheaded statement you think it is. Do you have a credit score of 300? Congratulations! You're either legally dead, or you have some anti-establishment bent that's prevented you from functioning like a normal human being.
Do you have an 850? That means that your spreadsheets have spreadsheets, and you read so many credit reports that "bankruptcy" is now your safe word with your partner. But what does it actually mean to have a "good" or a "bad" score?
Like I mentioned above, a credit score is basically your trustworthiness to financial institutions. Through a complex formula made up of payment history, credit utilization (total amount you owe on all of your credit accounts), length of your credit history and new credit lines, you're assigned a number. That number indicates to financial institutions like banks or credit card companies how trusting they can be with you.
The lower your score, the typically higher interest rate you'll receive because you're viewed as "higher risk" to the institution. The higher your score, the more favorable the interest rate you'll likely receive, because you're viewed as a lower risk to pay the money back. This credit score is used across any line of credit you look to open, from a new credit card to a mortgage or car loan. The longer you have open lines of credit and paying back your loans on time, the more likely you are to qualify for lower rates and better loan products, which could also mean you qualify for greater rewards.
How To Use A Credit Card
Why would you use a credit card over something like a debit card, then? Because credit cards offer huge rewards for using them. Each company has their own system of rewards, whether that's company-exclusive points, points with a partner company or just straight cash back into your account. Credit card companies offer these points as incentives to use the cards, because the companies stand to gain fees when you use them. Even if you're someone that pays your cards back on time and never assess an interest charge, the simple use of your card at a merchant will initiate a transaction fee on the seller side, generating revenue for the credit card company. While you're earning points and rewards, you're also effectively acting as a walking, talking revenue driver for a company like Capital One or American Express.
However, just because you're making money for the credit card companies doesn't mean that the rewards are just a token offer of appreciation from the institutions. When used properly, credit card rewards can be extremely powerful tools for the everyday person. Using the right mix of cards in your daily spending habits can quickly accrue big-time rewards that can turn into things like taking your dream vacation for free, or getting a huge chunk of cash back to pay for holiday presents. Whole industries, like this author's favorite "The Points Guy," have been created to help you maximize your credit card rewards. The most popular use of these points, however, is for travel, with premium travel cards slowly taking over the industry. Today, let's look at the most popular premium travel card that you only qualify for with a credit score of over 700, but can score you big rewards in exchange for big spending. This is the Platinum Card.
The Platinum Card from American Express
What Is The American Express Platinum Card?
The Platinum Card is the consumer creme-de-la-creme of the travel credit card industry. It's the highest non-invite only card from American Express, and is aimed at frequent travelers around the world.
Initially debuting in 1984, it was originally meant to be the travel card for the upper class and the frequent business traveler, offering benefits that helped offset business travel costs. However, over the years it has transitioned into being the travel card for credit card eggheads that tend to be airline agnostic and want a refined travel experience.
Offering a slew of benefits, the card is really meant to turn your travel spending into more travel points, which in turn leads to more travel spending and points. However, it does offer some other pretty sweet benefits which we'll get into.
American Express Platinum Card Benefits
Here are the main perks you get with this card:
Up to a $200 annual hotel credit, in the form of a statement credit, on prepaid Amex Fine Hotels and Resorts or The Hotel Collection bookings with Amex Travel when you pay with your Amex Platinum.
Up to $179 annual Clear credit to cover your annual membership.
Up to $240 annual digital entertainment credit, in the form of $20 in monthly statement credits when you pay for eligible purchases with the Amex Platinum at eligible partners.
Up to $300 annual Equinox credit, in the form of $25 in monthly statement credits on select Equinox memberships of Equinox+ app.*
Up to $200 in statement credits annually for incidental fees charged by one airline you select.*
Uber VIP status and up to $200 in Uber Cash, split into monthly $15 credits for U.S. rides plus a $20 bonus in December.*
Up to a $100 statement credit for Global Entry every four years or an $85 fee credit for TSA PreCheck every 4 1/2 years (depending on which application fee is charged to your card first).
Up to a $100 Saks credit, split into two $50 statement credits between January and June then July through December.*
Access to the American Express Global Lounge Collection, including Centurion Lounges, Priority Pass lounges, Airspace lounges, Escape lounges and Delta Sky Clubs (when traveling on same-day Delta flights).*
Complimentary Gold status with Hilton Honors and Marriott Bonvoy.
Complimentary memberships in Hertz Gold Plus Rewards, Avis Preferred and National Car Rental Emerald Club Executive.
Access to Amex Fine Hotels and Resorts and The Hotel Collection.
If your trip is delayed by more than six hours because of a covered reason, you may be eligible to be reimbursed up to $500 per covered trip for reasonable additional expenses.
If you need to cancel or interrupt your trip because of a covered reason, you may be eligible for reimbursement of up to $10,000 per covered trip.
Extended warranty benefit extends eligible manufacturer’s warranties of five years or less by up to one additional year.
Purchase protection protects recent purchases against theft, accidental damage or loss for up to 90 days from the purchase date.
Return protection on eligible items within 90 days from the purchase date if the merchant won’t take the item back.
To add to all of this, there's also a temporary 10x point bonus on restaurant and small business spending for the first 6 months after you sign-up for a new card, up to $25,000, meaning you could technically receive 350,000 bonus points after your 6 month new sign-up window. Of everything I just covered, there are three huge benefits I want to cover in a little bit more detail.
Amex Platinum Concierge
The Amex Concierge is a unique feature for the Platinum and Centurion Card holders that I think bears fleshing out. If you hold one of these cards, you gain access to the Amex Concierge service, which can help you out at any time, pretty much anywhere, with pretty much any request (within reason). Need reservations to that hard to book restaurant? Your concierge can handle that through their partnership with Rezzy and alleged first name basis with many popular restaurants. Need flowers and balloons at the last minute for your partner's birthday? They can handle all of that, charging it to your card for the same price it would have been if you handled the logistics yourself.
If you're a Platinum Card holder, then you get access to the concierge service, but you'll likely get a different person each time you hop into the service. If you're a Centurion Card holder, you actually get your own individual concierge who you can chat to at any time. While this might sound a little superfluous for just owning a credit card, it can come in handy, even during life or death situations. As mentioned in my piece about the Centurion Card, Brian Kelly's Centurion concierge got him out of Bali during a volcanic eruption.
Amex Fine Hotels and Resorts
This is a little known perk to people outside of the credit card travel world, and one that should be in every traveler's back pocket. The Amex Fine Hotels and Resorts (FHR) program is an online portal only accessible to Platinum or Centurion Card holders that allows members to access exclusive hotel benefits with partner hotel chains. Things like late-checkouts, free nights, resort fee credits and complementary breakfasts at high-end hotels around the world are standard for this program. Not to mention that booking this through the portal gives you the 5x points bonus on your card, leading to potentially cheaper, or even free, travel in the future.
American Express Centurion Lounge Access
While this one sounds like one of those perks reserved exclusively for douches, it's actually a life-saver when you travel enough to justify owning this card. Whether you misjudged the security line and you're at the airport three hours early, or you have an extended layover in some far-flung country, an airport lounge can be an awesome way to find some peace, quiet and booze while you wait. I can personally attest to the Delta Sky Clubs, which are included with this card and are excellent. However, the chief perk here is the access to the new Amex Centurion Lounges, which are starting to crop up across the United States. These lounges contain top-class amenities for the cost of entry, including food, booze, spa services and work stations. Some also include child play areas, hopefully cutting down on the screaming you have to deal with if you're traveling with your family.
Notably, Centurion Lounges are also beginning to appear in non-airport settings. This year, Amex opened a pop-up Centurion Lounge at the U.S Open tennis major in New York, giving cardholders access to an exclusive observation deck of some of the biggest tennis matches.
The Downsides of the American Express Platinum Card
It isn't all sunshine and rainbows with this card. While the above perks sound awesome, there are some big hurdles to clear with this card. Most notable of all is the annual fee. Typically credit card annual fees range anywhere from $99-$250 per year, with some higher end cards getting over $300. The Platinum Card? That just recently received a bump in its annual fee, bringing the total to $695. That's eye-watering. That right there is enough to make you throw up your hands and walk away from the card. But wait, there's more.
That $695 annual fee is designed to be offset by the annual statement credits you receive through the different programs and partnerships Amex has that you can apply. While some are incredibly useful (the monthly Uber credits spring to mind), some of them are so niche that they may as well not exist for 99% of us. Unless you live in New York or L.A, you probably won't be using that Equinox credit, valued at $300 per year. The other fitness credit that doesn't make a lot of sense is the SoulCycle at-home bike, which Amex is offering $300 back in the form of a statement credit. However, the bike itself is $2,500 and it requires enrollment in the Equinox+ membership to qualify, leaving you deep in the hole on that one.
Finally, there's the general usability of a travel card in the current environment. Thanks to COVID, travel has been remarkably difficult, especially from the U.S. Many popular countries in Asia and Europe have included the U.S on different forms of travel lists, either limiting or outright banning visitors with a U.S origin. While some of these are gradually rolling back, the spread of the delta variant could see travel bans re-imposed at a moment's notice, effectively killing the main advantages of owning this card. If this happens, this card becomes a very shiny piece of dead weight that costs you $700 a year.
Is The Amex Platinum Card Worth It?
The Platinum Card is an absolute winner, but it's certainly not for everyone, including myself. Last year, I assessed my spending and decided I needed to take better advantage of the cards on the market. The Platinum Card was certainly on my list, but I instead opted for the American Express Platinum Delta Card, which is a co-branded card with Delta Airlines that offers more targeted perks for that specific airline.
Since I'm Atlanta-based, this card made a lot more sense for my personal situation. That being said, I'd like to revisit The Platinum Card when the pandemic begins to wane and travel opens back up. I'd like access to the Amex Fine Hotels and Resorts program to take advantage of the hotel status and perks, because that's just added value. I'd also like the concierge service, because life logistics taken off my plate sounds worth its weight in gold.
The main point here is: assess your own situation. Do you spend enough on travel to justify the hefty annual fee? Are travel perks more important to you than status with one specific airline or cash back each month? Do Amex's travel and hotel partners line up with your preferred carriers? And, most importantly, can you afford that hefty $695 per year annual fee?