I’m one of those oddballs who gets by with one debit card and one credit card. I’ve never signed up for a store card. And I’ve always stayed clear of loyalty programs — I might be tempted to spend money I don’t have just to rack up points.
But lately, I’ve been wondering if I’m actually leaving money on the table by not participating. (Plus, if one more acquaintance shows me their Instagram story of the amazing holiday they subsidized through rewards points, I might just crack.)
So, I’ve been wondering: which travel points credit cards are good for risk-averse newbies like me?
American Express cards are often ranked highly when it comes to travel rewards. So that’s where I decided to start my credit card journey. I quickly found that American Express offers a surprisingly utilitarian travel rewards card for entry-level users such as myself: the American Express Air Miles Credit Card.
I took a deep dive to find out how well this card works when stacked up against the other options out there.
Here’s a rundown of the card’s features:
- There’s no annual fee
- It has a monthly interest rate of 19.9%
- New cardholders can earn a signup bonus of 500 Air Miles
- On top of that, referring a friend earns you an additional 200 Air Miles points
- You can transfer the balance from another credit card to your American Express account and pay only 1.99% in interest for six months — and there’s no fee for doing so
- As a cardholder, you’re entitled up to $100,000 in travel insurance coverage
- Plus, American Express will insure that hotel reservations made with the card are not lost if your check-in is delayed
Some other cool stuff they’ve thrown in:
- Apple Pay is now available with American Express
- Through its Front Of The Line program, cardholders can buy tickets to “sought-after events” before they go on sale to the general public
- In case you miss the cutoff for any pre-sales, American Express reserves blocks of tickets for cardholders. Events include live music, theatre, restaurants and comedy shows
Every $20 you spend earns you one mile. But, if you shop at a retailer that’s an Air Miles sponsor, you earn a point for every $15 spent; this way, you accumulate Air Miles faster.
How it stacks up against the competition
One of the closest comparable cards to the American Express Air Miles Credit Card is the BMO Student Travel Air Miles MasterCard. They’re similar in that there’s no annual fee and you earn Air Miles at basically the same rate (one point for every $20 spent).
BMO advertises its partnerships with grocery and gas chains as a major selling point. American Express also has partnerships with a wide array of merchants. However, many of these partners are high-end retailers. If your idea of a good time is a night out at Hy’s Steakhouse or a shopping spree at Williams-Sonoma, knock yourself out — you can earn double the Air Miles points by shopping at these establishments.
On the other hand, the perks available to holders of the American Express Air Miles Credit Card are simply anemic compared to other cards in the same family. Take the American Express Air Miles Platinum Credit Card: it’s just one level up, and for $65 annually, offers 2,000 Air Miles points for signing up, as well as expanded insurance coverage (it covers travel and rental car insurance).
This card also has a lower earn rate than competitors. You get one mile for every $20 spent, whereas competitors like the BMO Air Miles World Elite card will get you one mile for every $10 spent. The difference can be substantial: spending $2,000 a month on the BMO card will earn you 2,400 Air Miles a year. For this card, it’s 1,200 points a year.
When looking at the Air Miles flight map, 1,200 points will get you a free flight anywhere in Ontario. But once you move up to 2,500 points, you suddenly have access eight provinces and a dozen states.
Of course, where the American Express Air Miles card wins out is in accessibility. There is no fee to hold it and the minimum income requirement is just $15,000 a year: the BMO card, by comparison, requires you to earn at least $80,000 a year individually or $150,000 a year as a household. Plus there’s an annual fee of $120.
To pocket the bonus 500 Air Miles, you must spend at least $500 on the card within the first three months.
Because of its high “swipe fees,” there are still retailers who don’t accept American Express — a common gripe in online forums is the fact that neither Loblaw’s nor No Frills take AMEX — so you’ll need a backup VISA or MasterCard.
There’s definitely some truth to AMEX’s baller status.
Some criticisms that aren’t specific to American Express: the Air Miles point-redemption fiasco of 2016 still looms large in the minds of many consumers. Five years ago, the company introduced a new program that would see points expire after a period of five years. Air Miles killed that policy after huge pushback from consumers who argued they weren’t sufficiently warned. However, a class action lawsuit against the company is still pending and complaints about difficulty redeeming points keep rolling in.
Who’s this card for?
Given that you only need an annual income of $15,000 to qualify, this card’s probably a good fit for a person who’s still early in their career, who aspires to travel (its travel insurance policy is likely one of the most competitive in the market) and has a tendency to shop at premium retailers (your best rewards rate comes from shopping at high-end stores).
Tim Hortons started accepting AMEX a few years ago, so if you want to dazzle your friends by paying for coffees using your Apple Watch, you can do that too: the card syncs to Apple Pay.
The American Express Air Miles Credit Card is a good travel rewards card for the beginner. The barrier to entry is very low: there’s no annual fee and a low income requirement.
If you’re working part time in school or are freshly graduated, this is a great card to begin your rewards points journey. But if you’re more established and can qualify for premium cards, there are better products that allow you to collect Air Miles or equivalent loyalty points quickly.
See all of your options by comparing the best rewards credit cards using our comparison tool.Compare cards