Should you get the American Express Gold Card or the Platinum card first? The scenario varies depending on if you’re currently an American Express customer or not.
Scenario 1: Existing American Express customer
If you are currently an American Express customer, someone who has a Membership Rewards point earning card or a co-branded Amex like the Marriott Bonvoy and Hilton cards, then it doesn’t matter which card you get first.
American Express often runs targeted offers for new customers as a user acquisition strategy. New prospects are typically targeted for the 100,000 point Amex Platinum offer via sites like CardMatch.
Scroll down to the end of the post to check CardMatch offers.
Existing American Express customers are not likely to get targeted for increased offers, so they can apply for either the Gold or Platinum card first based on their spending habits.
I suggest crunching your numbers into our “Worth It” calculators to see which card is best for you.
Scenario 2: Not an American Express customer
If you do not own any Amex cards, then I suggest applying for the Platinum card first if you’re targeted for the 100k offer.
New targeted offers are often sent out periodically, so if you’re not targeted now, check back at a later date.
To illustrate my point, you’re missing out on a potential 40,000 MR points by getting the Amex Gold card first:
1) Gold + Platinum:
= Gold offer + Plat (60,000 MR)
= Gold + 60,000 MR
2) Platinum + Gold:
= Platinum (targeted) (100,000 MR) + Gold offer
= 100,000 MR + Gold
What are 40,000 MR points worth?
What can you do with an extra 40,000 MR points? The value of points depends on how you plan to redeem them.
1) Cash out via Schwab Platinum:
1.25 CPP * 40,000 MR = $500
2) Transfer to partners for travel
2 CPP * 40,000 MR = $800
Example: With current 30% Virgin Atlantic promo, 40k is:
a) ~one-way First (West Coast to Tokyo)
b) ~one-way Business (East Coast to Tokyo)
Should you wait for the 100k offer?
If you don’t wait for the 100k offer, you’ll miss out on 40,000 points. To earn 40,000 MR points on the Amex Gold card, you’ll need to spend $10,000 on 4x categories.
TLDR: You’re recouping 40,000 MR in value. A few more scenarios…
If MR = 2 CPP (transfer partners)
If opportunity cost = 4%
“Breakeven” to recoup 40,000 MR = x spend...
40,000 * 2 CPP = (4x)(2 CPP)(spend) - (4%)(spend)
$800 = 0.08x - 0.04x
x = $20,000 spend within 4x categories
Cash out route:
MR = 1.25 CPP
40,000 * 1.25 CPP = (4x)(1.25 CPP)x - (4%)x
$500 = 0.05x - 0.04x
$500 / 0.01 = x
x = $50,000 spend within 4x categories
If you plan to cash out the points, you’ll need to spend $50,000 on the Amex Gold Card 4x categories to recoup the cost.
Put another way, if you’re drooling over 4X MR, an extra 40,000 MR is probably worth getting.
Exceptions: Who should get the Amex Gold Card first
The first exception for people who shouldn’t wait for the 100k offer is those who plan to spend $20,000 on U.S. restaurants and U.S. grocery stores in the next 12 months.
$20,000+ on 4x categories in next 12 months.
The second group of people who should get the Amex Gold Card first are people who get negative expected value from the Platinum card. Crunch your numbers here: http://bit.ly/2BEUufO
Amex Platinum is negative expected value (even with 100,000 MR)
In the first year, you’re effectively getting “paid” to have the card if you can utilize the intro bonus and all of the statement credits.
a) 100,000 MR * 1.25 CPP (Schwab) = $1,250
b) 2019 + 2020 Airline Incidental Credits = $400 DL/SW
c) 2019A + 2019B + 2020A Saks Credits = $150 Saks
d) $15 * 12 + $35 * 1 = $215 Uber/UberEats
No discount = Value statement credits at full value
= $1,250 + $400 + $150 + $215 - $550
= $1,465 expected value
50% discount = Don’t value statement credits at full value
= $1,250 + 0.5($400 + $150 + $215) - $550
= $1,250 + 0.5($765) - $550
= $1,082.50 expected value
As always, your mileage may vary, so get the card that best fits your lifestyle and spending habits.
Editorial Note: Opinions expressed here are the author's alone, not those of any bank, credit card issuer, airlines or hotel chain, vendors or companies, and have not been reviewed, approved, or otherwise endorsed by any of these entities.
UGC disclosure: These responses are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser's responsibility to ensure all posts and/or questions are answered.