American Express Membership Rewards - New Amex: No annual fee, 5% cash back

American Express Launches Cash Rebate Card Providing Up to 5% Cash Back for Purchases On the Card
Card Offers No Annual Fee, Competitive Rates And Up to 5% Cash Rebate
NEW YORK--(BUSINESS WIRE)--July 29, 2002--American Express (NYSE:AXP - News) today announced the introduction of the American Express® Cash Rebate Card which offers a cash rebate of up to 5%.

The cash reward is based on a Cardmember's annual spending and payment activity.

The Card combines the valuable benefits and services provided by American Express with the ability to earn cash back for purchases made on the Card.

"Consumers want to get something back for the money they are spending on their credit cards. With this Card, we've made earning cash rewards easy and more valuable since you earn more rewards for the things you buy every day," said Larry Sharnak, senior vice president of consumer lending at American Express. "The Card is a great deal for consumers and shows American Express' intent to lead the market in cash rewards."

The benefits of the Cash Rebate Card include:

No annual fee
0% introductory APR for six months*
Cash Rebate of up to 5% -- The cash reward is based on customer spending and payment behaviors. The annual cash reward for purchases is up to 3%. There is an additional rebate of up to 2% for purchases in months in which the account carries a balance. An account is eligible for a rebate applied to a maximum of $50,000 of eligible annual spending.
Additional American Express Card benefits include: Purchase Protection Plan, which insures covered items purchased with the Card from accidental damage or theft; Buyer's Assurance, which extends a manufacturer's warranty for up to one additional year on U.S. warranties of five years or less*, the ability to check and pay bills online and American Express customer service.

http://www66.americanexpress.com/cards/Fmacfservlet?csi=66/20/b/3/0/210091459232/0/n

And the fine print:

Your annual cash reward for everyday purchases at stand-alone U.S. supermarkets, drugstores, gas stations and home improvement stores is up to 3%. Your annual cash reward for all other purchases is up to 1.5%. You will receive an additional rebate of up to 2% for purchases in months in which your account carries a balance. Your cash rewards are limited to $50,000 of eligible spending.

is this the same old cash back card? from Amex web site, this seemed to be the only cash back card now.

[This message has been edited by bellwilliam (edited 07-29-2002).]

I wonder if the additional 2% rebate for months when you carry a balance include within those first 6 months with 0% interest.

If yes, then this is a great card for purchasing savings bonds.

.

[This message has been edited by mileageman (edited 07-30-2002).]

What the hell do they mean "up to" 1.5%? Like it's up to them how much rebate they actually give you?

I also don't like the "up to" in front of the rebate percentage. They should give the full percentage back. The "up to" usually means there is a minimum amount you have to charge to get the full percentage. Anything less than this and you'll still get some cashback, but less than 1%.

IMHO, the Chase Stockback card is much better because you get a full 1% back on all purchases (no minimum required) and you can get up to 10% back at some merchants (no minimum required).

I just applied for the card...i like the 3% for groceries and other stuffs..

Anyone here applied?

Read over the Terms and Rules of the Cash Rebate apparently, one will only get .05% rebate for everyday purchases and .025% for non everyday purchases $2000 after $2000 For the next $4000,one will receive 1% on everyday purchases and .5% for non everyday purchases. After $6k one will finally receive the full 3% for everyday purchases.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by bellwilliam:
is this the same old cash back card? from Amex web site, this seemed to be the only cash back card now.

[This message has been edited by bellwilliam (edited 07-29-2002).]</font>

I checked with Amex and they said you have to reapply if you want the new card benefits http://www.flyertalk.com/forum/rolleyes.gif

Was at the Jewelry store and the guy asked me what kind of American express card is this? I told him that it was new..he said that this card is the coolest designed card that he has ever seen.

Then...he went on and on about seeing a customer from the Middle East carrying the "black card"...

[This message has been edited by afang (edited 10-14-2002).]

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by afang:
Read over the Terms and Rules of the Cash Rebate apparently, one will only get .05% rebate for everyday purchases and .025% for non everyday purchases $2000 after $2000 For the next $4000,one will receive 1% on everyday purchases and .5% for non everyday purchases. After $6k one will finally receive the full 3% for everyday purchases.</font>

Since the card is offering the first 6 month interest free, you can just buy $6000 savings bond first and enjoy the full benefit - rebate at 1.5/3%, or is it really 3.5/5% since you are carrying the balance?

As I value a mile at 1.3c, this cash rebate card with no annual fee may be the best card out there for everyday purchase (except during the 2x/3x promotional period http://www.flyertalk.com/forum/smile.gif for the Delta AmEx.)

OTOH, I value a HH pt at 0.67c, the HHonors AmEx rebates a flat 2.0% in hotel points. But the card doesn't have everyday 2x bonus. So, I think HH AmEx should be the card to use for non-everyday purchase. Also, during the 2x promotional period (like upcoming Jan 03), HH AmEx should be the card to use for all purpose.

One other favorite card that preferred by FT'ers is the Starwood AmEx which costs $30 a year. Given that this card give bonus miles for mileage conversion, I value a starwood point at 1.6c. But this card never runs any 2x promotion though. Actually, this card never appeals to me at all. (Yeah, for the flexibility of transfer to almost all FF program... but if you don't transfer 20000 pts at a shot, you don't get the bonus. Besides, I have never redeemed a single mile for flight in my life.)

So this new cash rebate card can be a good alternative to airline mileage card if/when you got too many miles...

Just me 2c.

[This message has been edited by FT wannabe (edited 11-30-2002).]

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by FT wannabe:
So this new cash rebate card can be a good alternative to airline mileage card if/when you got too many miles...
</font>

Too many miles? Heaven forbid!

I remember looking at this card recently and what turned me away was the fine print: You get the high cash back in months when you carry a balance. Does anyone know if you can carry a nominal balance, like a buck, and pay off the rest? Otherwise, the interest cost may totally outweigh any cash back benefit.

My logic is this -

Miles are only valuable when you use them for last minute flight, upgrades, or B/F ticket award. If you already have some 6 digits miles in your account, it doesn't make much sense to get many more. Given all the restriction to redeem an award and air tickets can be had for cheap these days, a mile is worth &lt; 1.5c if you plan to redeem the miles for coach class ticket. Besides, your miles won't earn you interest! So, instead of keeping a mileage based card (such as a Skymiles AmEx), you could have carried this new cash back card. It doesn't have annual fee; you can play the game by charging $6000 on bonds early in the year and get the maximum 1.5/3% rebate the rest of the year. (The annual cap is $50000 charge though.)

The 3.5/5% rebate applies only when you carry a balance. And I think AmEx eliminate your grace period even if you have a $1 carryover balance. So, you will only lose money by carrying even a small balance.

Again, only my 2c.

I've been carrying this card for a few months now.

See my post in the Southwest forum (yeah, odd, i know) for my analysis of the details, but to address the question that came up earlier here,

The 0% 6 month initial period DOES count as carrying a balance.

I'm into month 4 I think, and haven't paid off the card yet (but putting the money aside each month in a 2% money market for a little added bonus). Of course, when month 6 hits, I will pay off the card.

In the meantime, I'm building up to the highest spending tier, which will be 1.5% cash back on most purchases and 3% on the specials. In this initial period, you earn .25% for first 2k, .5% for next 6k, 1.5% for everything else PLUS a .5% bonus for the carry-balance months.

So yes, combined with the fact that it's a fee-free card, if you're willing to wait the year + 2 months for your rebate to post, it's a pretty good deal.

I just applied for this card. Aside from carrying the balance the first six months, do you think it's worth carrying the card from that point forward? I applied because I was looking for a card that gave me cash back/points/miles, because we are no longer allowed to earn MR Points on our Corporate AMEX. Saw this one, thought it might be a decent deal.

I just applied for this card. But after I got approved, I read the fine-print

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">The rebate is an annual rebate equal to the following percentages of your annual level of purchases: for the portion of total annual purchases that qualifies as everyday spend, you will receive a rebate of 0.50% for the first $2,000, 1.0% for the next $4,000 and 3.0 % for purchases in excess of $6,000. For the portion of total annual purchases that is non-everyday spend, you will receive a rebate of 0.25% for the first $2,000, 0.50% for the next $4,000 and 1.50% for purchases in excess of $6,000. An additional 2.0% rebate will be added for qualified everyday spend and an additional 0.50% will be added for non-everyday spend in any billing period in which your account carries a balance. Everyday spend offer applies to purchases at qualifying U.S. stand-alone supermarkets, drugstores, gas stations, and home improvement stores; non-everyday spend relates to all other purchases. In each year of Cardmembership, your Cash Rebate rewards are limited to $50,000 of eligible spending. </font>

Does that mean I have to charge $6000 on everyday purchase to earn the maximum 3% rebate and another $6000 separately on non-everyday purchase to earn the 1.5% max rebate for that type of charges? If this is the case, there are simply way too many hoops to jump for this card.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by FT wannabe:
I just applied for this card. But after I got approved, I read the fine-print

Does that mean I have to charge $6000 on everyday purchase to earn the maximum 3% rebate and another $6000 separately on non-everyday purchase to earn the 1.5% max rebate for that type of charges? If this is the case, there are simply way too many hoops to jump for this card.</font>

It actually means you have to spend more than $6000 on everyday to get 3% - you only get the 3% on the amount over $6k. That's a lot of groceries and gas.

The only problem with the card is the laughable $2000 credit line I got approved for. How can I charge enough to ever generate some reasonable rebate with such a low annual limit 12x$2000 = $24000. This card is useless unless they increase my credit line.

I wonder whether I can shift my credit line from my DL Gold AmEx...

You can ask to increase the credit line.
They often say you cannot increase the credit line for first 6 months, but if you have already had higher credit line with other Amex, they may consider.
I asked to increase the credit line for rebate card after a few months and it was approved right away. They asked me how much credit line I wanted and they gave me the line one digit higher.

Okay, just to make sure I understand ... if I get the card and a big enough limit, I could buy $6,000 in savings bonds and earn a rebate of $25 ($2000 at 0.25% and $4000 at 0.5%). Since the first six months of card membership is at 0%, I carry a balance for several months, making only the minimum payments). Then, at say the four month mark, I pay off the remaining balance except for one dollar, and once my line of credit has been restored, buy another six thousand dollars in savings bonds, this time earning a rebate of $120 ($6,000 at 2%). I then cash in the first $6000 in bonds at the six-month mark, earning three months of interest in the process, and use that money to pay off the $6,000 I have owing on the credit card just before the 0% interest period ends. (I can see where timing this might be problematic depending on when the bonds become eligible for redemption vs. when the credit card's billing cycle runs.)

Assuming that I have six thousand dollars to play with at the start (to cover the period until the second set of bonds become redeemable) it seems like I can get $145 plus some bond interest at little or no cost to myself, plus I will have primed the pump for the credit card to get the maximum non-balance carrying reward during the remainder of the year.

Assuming that I am correct in all of the above assumptions, and correct me if I am not, for the remainder of the year, would I get the maximum rebate on just the "non-everyday purchases" or on the "everyday purchases" also. In other words, in order to get to the highest rebate percentage, does it take $6000 in "everyday" spending AND an additional $6000 in "non-everyday" spending, or just $6000 in combined spending? It seems like from the portion of the terms and conditions that have been posted, that the totals are not cumulative, and that it would in fact take $12,000 in spending to get to the top in both.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by amanuensis:
Assuming that I am correct in all of the above assumptions, and correct me if I am not, for the remainder of the year, would I get the maximum rebate on just the "non-everyday purchases" or on the "everyday purchases" also. In other words, in order to get to the highest rebate percentage, does it take $6000 in "everyday" spending AND an additional $6000 in "non-everyday" spending, or just $6000 in combined spending? It seems like from the portion of the terms and conditions that have been posted, that the totals are not cumulative, and that it would in fact take $12,000 in spending to get to the top in both.</font>

I am still eagerly waiting to receive the card. But I have decided that if they don't move my credit line from my DL AmEx, I will have to cancel the card. From their wording, it does seems everyday and non-everyday expenses are two different category with individual qualifying threshold for the maximum rebate. I don't project to incur more than $6000 in groceries/gasoline in any single year. So, I'll only use the rebate card for non-everyday expenses (including bonds).

I will need to have a $6000 credit line to play the bonds turnover game - but I only got approved for $2000 initially. Will see what they say when I call them after I got the card.

umm... the amex representitive i talked to told me a different story. she told me that the cash rebate is calculated at the end of your usage year (every 12 billing cycles). if your total (everyday and non-everyday) purchases is between 6001-50000, you get 1.5% on ALL the non-everyday purchases and 3% on ALL everyday purchases. it's NOT 0.25/0.5% for the first 2000, 0.5/1%for the next 4000, and 1.5-3% thereafter.

who is correct?

[This message has been edited by mystara (edited 12-17-2002).]

I think the phone rep was wrong, based on what FT Wannabe quoted from the Terms & Conditions. I will bold what I think are the key words.

"The rebate is an annual rebate equal to the following percentages of your annual level of purchases: for the portion of total annual purchases that qualifies as everyday spend, you will receive a rebate of 0.50% for the first $2,000,1.0% for the next $4,000 and 3.0 % for purchases in excess of $6,000. For the portion of total annual purchases that is non-everyday spend, you will receive a rebate of 0.25% for the first $2,000, 0.50% for the next $4,000 and 1.50% for purchases in excess of $6,000."

From this, it appears clear to me that the rebate is calculated only once per year, and that if you have spend more than $6000 in either category, you only get the highest rebate on that portion that is in excess of the $6000. However, since it is calculated annually, how does AMEX determine which spending qualifies for the higher, carrying a balance, rebate? I understand from the terms and conditions that it is calculated based on each billing cycle rather than annually. But then this contradicts the language that says that the amount of rebate you get is based on annual purchases.

I have no confidence in getting this question accurately answered by front-line customer service reps at AMEX. It seems like all credit card companies have trouble finding reps who can accurately answer questions that are more complicated than "what is my balance?" The rep that Mystara spoke with misunderstood the terms and conditions of one AMEX's own products.


[This message has been edited by amanuensis (edited 12-17-2002).]

OK. I talked to the customer service rep and after some holdings, it's confirmed that the 2 reps at the application center were wrong (and there were sooooo sure too http://www.flyertalk.com/forum/tongue.gif). NOW this card sux. I will stay with the Delta Amex for everyday purchases and HHonors Amex for other charges. http://www.flyertalk.com/forum/smile.gif

[This message has been edited by mystara (edited 12-17-2002).]

I finally received the card. And my request for transferring my credit line from my Delta AmEx is easily granted over the phone. Now I can charge $6000 on saving bonds to start the game.

Also, from the inserts of my packet, I found more relief about the rebate structure. It is the total charge at the year that counts. If your annual total charge is less than $6000, you are better off cutting the card now. The rebate after the first $6000 charge is at the 1.5%/3% rate (more if I carry a balance...) In other words, I don't need to have $6000 charge in everyday expenses and another $6000 charge in non-everyday expenses to get to the top rebate tiers.

Saving bonds here I come.

That's great news, FT Wannabe! Would you mind taking the time to transcribe the text from the insert you referred to?

Okay, it's time to pay my dues to the the board. Quoting from the inserts...

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">...You will receive an annual rebate on the amount of your Purchases (net of credit for Purchases) made during the previous year ("Annual Purchases") based on the following structure:

For the first $2,000 in Annual Purchases, you will receive a rebate of 0.50% for "Everyday Purchases" and 0.25% for "Non-Everyday Purchases". For the next $4,000 in Annual Purchases you will receive a rebate of 1.0% for Everyday Purchases and .50% for Non-Everyday Purchases. You will receive an additional 2.0% rebate for Everyday Purchases and an additional 0.5% rebate for Non-Everyday Purchases posted to your account in any billing period for which you do not pay in full the undisputed outstanding balance on your Account for that billing period provided your Account is not in default...

...Your rebate will be calculated for each billing cycle in accordance with the timing of your Purchases; provided, however, that if a Non-Everyday Purchase item and an Everyday Purchases item are purchased on the same day, the Non-Everyday Purchase item will be added first to determine your rebate tier level so that you will receive the highest rebate percentage in accordance with the rebate structure described above...

...You will receive the rebate in the form of credit to your Account two months after your anniversary date. To receive the rebate in any year, your Account must be active (not cancelled) in the month of your anniversary date... A rebate will not be awarded for the amount of Annual Purchases in excess of $50,000.</font>

To me, it is clear that I don't need to charge $6000 worth of gas in order to start earning the highest rebate. $6000 of savings bonds should do the trick.

FT Wannabe:
http://www.flyertalk.com/forum/thumbsup.gif http://www.flyertalk.com/forum/thumbsup.gif http://www.flyertalk.com/forum/thumbsup.gif

Is there anyway to get Membership Rewards for all purchases using this card?

If you can, what is the best way to sign up with the card (ie least expensive)?

My thoughts are that I have resisted switching from Amex Delta Skymiles to this card if you get: 1) Rebate 2) No annual Fee and 3) Membership rewards which are applicable to any airline.

Please let me know.

Thanks

Anthony

Guys,

I think I am going to apply for this card. Can somebody tell me briefly, what savings bonds I should buy? I have 6000$ cash to play around with this CC, but no info. on what type of savings bonds I should buy, so that I can cash them out in 3 months...
Please help me out here!

Thanks in advance!

-RG

atwnsw2: no. this card is not qualified for membership reward program.

gya007: i bond or ee/e bond. ee/e is a better choice right now since the interest rate on it is higher than i bond. you can cash out in 6 months, or 5 if you plan carefully.

Thanks mystara!
-RG

Just an alert that the government is going to increase the minimum saving bonds holding period from 6 months to 12 months (http://www.flyertalk.com/forum/Forum1/HTML/008208.html).

Although the method of charging up with bonds will still work, it becomes a little less attractive.

Before: 1st 6 months: $2000*0.25% + $4000*0.5%(on CC) + $6000*1%(interest less penalty on bonds) = $85 return.
2nd 6 months: $6000*1.5%(on CC) + $6000*1%(on bonds) = $150 return.
A total of $235, or 3.9% on your investment of $6000. (Well, for the first year, that $235 is free since no interest is charged during the first six months.) If timing is right, the bonds can be "flipped" more than twice a year...

Now: Have to hold it for 12 months: $2000*0.25% + $4000*0.5%(on CC) + $6000*3%(on bonds) = $205 return, or 3.4% on the investment.

Just something to think about.

Many of the questions posted to this thread are answered and discussed in the following Fatwallet thread: http://www.fatwallet.com/forums/messageview.cfm?catid=52&threadid=100210

Cheers, Dave