Doctor of Credit recently put up a really good post wherein he asked a bunch of bloggers (including yours truly) to name the most undervalued credit card. There was a wide variety of responses and some good discussion for those of you who are into discussing credit cards, and I recommend you go check it out.
One response, from Chuck Sithe, had an interesting nomination for most undervalued:
Fee-free Amex cards in general. Some of them may not have much value to use for regular spend, but they’re great for Amex Offers. If you have a couple authorized-users to add, you can get real value from them. I’m also constantly on the search for fee-free Amex cards from third-party issuers, which are eligible for Amex Offers via Twitter. For example, there’s a Macy’s American Express card that most people never heard of.
Amex has had some great deals lately. I’m sure you’ve heard about the Staples and AT&T offers, and Frequent Miler just had a nice post on the DirecTV offer. Small Business Saturday was worth $30 per Amex this past year.
Which brings me to the title of the post: how much are those deals worth? Is it worth signing up for a no-annual-fee card from a non-Amex bank just to get in on the deals?
Everybody has their sweet spot for what a sign-up bonus ought to be worth–maybe it’s $100, maybe it’s $500. If the expected revenue stream from Amex offers exceeds that number, then an Amex card would be worth it. But of course there is a lot of uncertainty around those Amex offers, plus you have to take into account the hassle factor of getting the deals. Maybe they won’t be as good in the future, or maybe Amex will stop them completely.
I have a few sock-drawered no-fee Amexes right now. I take them out for Small Business Saturday and for a very occasional Amex offer (and for Costco trips), but aside from that they stay in the sock drawer. For me personally, Amex deals aren’t enough to get me to sign up for a card, but they are an incentive not to cancel a card. As always, your mileage may vary.