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Should You Upgrade Your American Express Card?
Does it make sense to upgrade your American Express card when you receive an offer? In this post, we are going to use the American Express Gold® Card as an example.
A few American Express Gold Card cardholders received an offer to upgrade to The Platinum Card® from American Express. The offer is to spend $1,000 to receive a 25,000 point upgrade bonus.
On the surface, it seems like a good deal, but it's more complicated because American Express limits your ability to get a intro bonus if you already had the product.
This means that if you take the upgrade bonus, you will not be eligible for a Platinum Card intro bonus in the future because you already have the card.
Why does this matter? We’ve seen Platinum Card intro bonuses range from 60,000-125,000 Membership Rewards points. By taking the upgrade offer, you’re effectively setting 35,000+ points on fire.
On the other hand, if you were not planning on applying for the Platinum Card in the future OR you previously had the Platinum Card, then taking the upgrade offer might be the optimal strategy.
TLDR: Don’t take an upgrade offer unless you previously earned an intro bonus for the card you’re upgrading to. You disqualify yourself from future intro bonuses (for the card you’re upgrading to) due to the “once in a lifetime rule” if you have or had the card, regardless of if you received a bonus.
Optimal Strategy
Scenario A (1 Card)
- Signup for the American Express Gold Card and get the intro bonus
- Wait until you receive an upgrade offer from Amex to upgrade the American Express Gold Card to the Platinum Card
Scenario B (2 Cards)
- Signup for the American Express Gold Card and earn the intro bonus (either cancel or keep for step 3)
- Signup for the Platinum Card and get the intro bonus
- Wait until you receive an upgrade offer from Amex to upgrade the Gold Card to Platinum bonus
- You can downgrade one or both = Amex Gold Card/The Platinum Card OR Amex Gold Card/Amex Gold Card
- You can also cancel one or both if they don't make sense to keep
The main difference between the two scenarios is one intro bonus. I wouldn't recommend going through the hassle unless it’s a high value bonus, but I think it's important to understand the game theory since this is technically a min-max problem.
These scenarios also apply to downgrades.
When you request a downgrade, you also disqualify yourself from receiving an intro bonus from the respective card.
Bottom Line
It's not optimal to upgrade your card unless you don't plan on getting the respective card in the future because it will disqualify you from receiving an intro bonus in the future.
For other credit card issuers, these scenarios aren't applicable because they're more forgiving than American Express. With Chase, you can receive an intro bonus for a product once every 24 months.
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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.
