If you cancel Amex Platinum to save the fee, the Amex Rewards Credit Card will keep your Membership Rewards points alive

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The second biggest topic in my inbox at the moment, after airlines not refunding payments, is the cancellation of fee-charging American Express cards.

Most of these relate to American Express Platinum.  This comes with a chunky £575 annual fee, but many HFP readers can make the numbers work because of the strong benefits package.  This includes:

travel insurance for you and your family, plus up to five supplementary cardholders and their families

car hire insurance

2 x Priority Pass airport lounge access cards, each of which allows a free guest on each visit (so a family of four is covered)

mid-tier status in Hilton Honors (Gold), Marriott Bonvoy (Gold Elite), Shangi-La Golden Circle (Jade), Radisson Rewards (Gold) and MeliaRewards (Gold)

£10 per month of Addison Lee taxi credit

Eurostar lounge access

…… and lots of other bits and bobs.  My full review of American Express Platinum is here.  The application form is here (and comes with 30,000 Membership Rewards points).

But there’s a snag …..

Paying almost £50 per month for these benefits works out well for many readers.  However, paying £50 per month for The Platinum Card when you’re not travelling is clearly NOT great value.

Many readers have asked me about American Express pausing the annual fee, or offering partial refunds.  To date, no-one has reported getting any financial concessions from them.

However, if you cancel, you receive a pro-rata fee refund.  This could put a few hundred pounds back in your pocket in these tricky times.

(One caveat: if you cancel, you will have no travel insurance if you have no other cover.  If you have non-refundable trips booked for well in the future, ensure you have coverage as you could fall ill at any time.)

There is no annual bonus on The Platinum Card

Many American Express cards offer an annual bonus when you hit a certain spend target:

The British Airways Premium Plus American Express card offers a 2-4-1 companion voucher for Avios redemptions when you spend £10,000 per year (BA Amex review here)

The Marriott Bonvoy American Express card offers Gold Elite status when you spend £15,000 per year and a (very restrictive) free night voucher when you spend £25,000 per year (Marriott Amex review)

American Express Preferred Rewards Gold offers 10,000 Membership Rewards points when you spend £15,000 per year (Amex Gold review)

On these three cards, it may make sense to continue paying the annual fee during these low-spending, no-travelling months in order to ensure you hit your annual spend target.

The Platinum Card does NOT have any annual spend bonus.  If you cancel now and reapply in 3, 4 or 6 months time when your travelling starts to pick up again, you haven’t lost anything.

The only risk is losing your Membership Rewards points

The only short-term downsides of cancelling your American Express Platinum charge card is that you are required to empty out your Membership Rewards points account.

Because Amex points can be transferred to many different airline and hotel partners, they are more valuable than airline or hotel points.  You shouldn’t convert them until you need them.

If you are forced to transfer them because you close your card down, you may regret it later.  American Express isn’t going bankrupt any time soon.  We can’t say that about many Membership Rewards transfer partners at the moment, especially the airlines.  The safest place for your points is with American Express.

Since late 2017, there has been a solution that:

lets you keep your Membership Rewards points account open, and

allows you to stop paying an annual fee for either the Gold credit or Platinum charge card

We very rarely write about it on HFP so I thought I would run through it again today.  This card is the answer:

Amex Rewards Credit Card

You can apply for the little-known American Express Rewards Credit CardFull details are here.

This card has NO ANNUAL FEE and lets you collect Membership Rewards points.

For simplicity, I will occasionally refer to this card as ARCC as ‘American Express Rewards Credit Card’ is a  bit of a mouthful.

What is the American Express Rewards Credit Card?

ARCC is a standard Amex-branded credit card.  It has no annual fee and no substantial benefits, except for the ability to collect Membership Rewards points at 1 point per £1 spent.

There used to be three versions of this card, but in Autumn 2019 they were consolidated to jut one.

The version which remains has a 5,000 Membership Rewards points bonus and a representative APR of 22.9% variable (click here).   You need to spend £2,000 within three months to receive the bonus.

It is unlikely that many (any?!) Head for Points readers will qualify for the bonus because you cannot have held any personal American Express card in the previous 24 months.  That’s not why you’re applying though.

Once your American Express Rewards Credit Card is active, you can cancel your Platinum charge card in the knowledge that your Membership Rewards points balance is safe.

You will be saving roughly £50 per month on your Platinum card.  Once your travelling starts to pick up, you can re-apply for The Platinum Card and start getting all the insurance, lounge and status benefits again.

You can apply for the FREE American Express Rewards Credit Card here.

PS.  If you have the free version of the British Airways American Express credit card but do not spend £20,000 on it generate the 2-4-1 voucher, you should dump it.  This card is better for you.  This HFP article explains why the Amex Rewards Credit Card is better than the free British Airways American Express card.

Disclaimer: Head for Points is a journalistic website. Nothing here should be construed as financial advice, and it is your own responsibility to ensure that any product is right for your circumstances. Recommendations are based primarily on the ability to earn miles and points and do not consider interest rates, service levels or any impact on your credit history.  By recommending financial products on this site, I am – technically – acting as a credit broker.  Robert Burgess, trading as Head for Points, is regulated and authorised by the Financial Conduct Authority to act as a credit broker.

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Comments

  1. Do you know if I will get credit checked when downgrading from an existing Platinum charge card to Gold or Green charge cards?

    • bouncingkiwi says:

      Downgraded this morning.

      Didn’t hear anything explicit about a new credit agreement or check (presumably the one for plat card and their current data would satisfy?) during the mandatory speal.

      Curiously, did get asked for my current annual salary, so….??

  2. bouncingkiwi says:

    Rang this morning,

    Downgraded to gold, no fee 1st year. MR and account maintained, completed in 10mins.

    Hope to step back up after things clear

  3. Christopher Bretnall says:

    Amex offered me to downgrade to Gold and all MR transferred and pro-rata refund to come on the Plat card. Took about 20mins. Was told to call again when I wanted to go back to Plat.

  4. Hamza Jamil says:

    Great timing. My Amex Plat renewal is this month! Thanks.

  5. Justin says:

    Great article! I have an Amex Plat and will cancel / switch to Gold soon.
    I have had this card 10 months (and received the sign up bonus). Can I cancel this soon, or do you have to stay for the full first year?

  6. Which of the loyalty programmes who provide status to Amex Platinum holders have a soft landing ?
    And which will, regardless of soft landing or dumping you to a zero, move you into a status level whereby points can now expire ?

    I have just been clobbered with the £575 fee and truly see no advantage in it for me for 12 months. This has also become, sadly, a significant sum of money to me right now.

  7. Is there a detailed explanation of what happens to each membership provided by the Platinum crd when you cancel / drop down to Gold / free ?
    Interested to know what will happen to status’ but more importantly any points built up in those programmes in terms of expiry changing due to drop in status.

    • It is all up in the air anyway because most hotel schemes are rolling everyone over into 2021. I would expect someone who cancelled Plat today to, for eg, keep their Bonvoy status until March 2022. No promises though.

  8. Have read that some Germn AMEX Platy holders are being offered ~42k MR points to retain.

  9. AmexShamex says:

    I am waiting for Axa to.accept a travel insurance claim and I may also lodge a claim in the future for a past trip, if my other travel insurance declines it. Do you think downgrading to Gold will affect my ability to make the future claim (in respect of a past incidence) or my current pending claim?

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