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American Express EveryDay Card: A Great Choice for Frequent Users

By Matthew Frankel, CFP® – May 26, 2015 at 11:10AM

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The American Express EveryDay Card has some unique bonus programs that don't just reward big spenders

The American Express (AXP -0.06%) EveryDay Card comes in two varieties -- the EveryDay credit card and the EveryDay Preferred card. Both offer similar features and benefits, and can be great choices for consumers who use their cards frequently, or who find American Express' Membership Rewards program valuable.

Good rewards rate, unique bonus opportunities
Both versions of the EveryDay card have rather generous reward rates, and accumulate rewards in Membership Rewards points, which can be redeemed in a variety of ways, such as travel, car rental, gift cards, statement credits, Uber rides, and more.

The EveryDay card accumulates double rewards points -- two points per dollar -- at supermarkets, up to the first $6,000 in purchases per year, and earns one point per dollar on all other purchases. New cardholders also receive a 10,000 point welcome bonus after spending $1,000 on the card within the first three months.

The EveryDay Preferred card has a more generous supermarket bonus -- triple reward points -- plus offers double reward points at U.S. gas stations. And the welcome bonus is sweeter, at 15,000 points after $1,000 in spending within three months.

One of the unique features of the card is a monthly point bonus not based on the amount spent, but on transaction volume. The EveryDay card offers a 20% bonus on points earned after 20 transactions are made during the billing period, and the Preferred card has a 50% bonus after 30 transactions.

In other words, it doesn't matter how large or small your transactions are, just that you're using the card frequently. Both cards come with a mobile app to help track the number of purchases, so cardholders can tell how many more purchases they need for a bonus.

Finally, both cards come with an assortment of American Express benefits, such as:

  • "Entertainment Access" -- access to ticket presales and Amex-exclusive events
  • Car rental insurance
  • Travel accident insurance
  • Roadside assistance hotline
  • Global assist hotline
  • Purchase protection -- protects items purchased with the card from accidental damage and theft for 90 days
  • Extended warranties on products purchased
  • Return protection -- if the merchant won't take an eligible item back during the first 90 days, Amex may refund your money

How much does it cost?
The EveryDay card has no annual fee, and the Preferred version has a $95 annual fee because of the more generous rewards rate. Other than that, both cards have the same fee structure.

Both come with a 0% introductory APR for 15 months on purchases and balance transfers, and have variable APRs between 12.99% and 21.99%, depending on the borrower's creditworthiness. Balance transfers are assessed a fee of $5 or 3% of the transfer amount, whichever is greater.

One fee that might turn off some prospective cardholders is the 2.7% foreign transaction fee, so consumers who travel internationally often may be better off with one of the many cards without such a fee.

Who should get the EveryDay Preferred card?
Whether you should get the regular EveryDay card or the Preferred version depends on how much you plan on using the card. Depending on how you redeem them -- and who you ask -- Membership Rewards points are worth between $0.01 and $0.02 apiece. So using the low-end to be conservative, let's say that you would need to earn 9,500 extra points per year with the Preferred card to make the annual fee worth it.

Just as a simplified example, if a Preferred cardholder planned to spend $5,000 at supermarkets and another $5,000 at gas stations during the course of a year, that would produce a difference of 10,000 Membership Rewards points over the regular card, and therefore would make the annual fee worth it. Of course, this doesn't include the value of the additional welcome bonus; but since it's a one-time bonus, we shouldn't consider it in our long-term decision of which card to get. And the additional bonus for using the card often -- 20% vs. 50% -- should also play a role in the decision for people who plan to use their cards often enough to qualify.

Is it right for you?
In short, the American Express EveryDay card is an excellent product for consumers who charge purchases often, or who want the opportunity to earn and redeem American Express' Membership Rewards points. The card that's best for you depends on how much you plan to spend, and how often you plan to use it.

Matthew Frankel owns shares of American Express. The Motley Fool recommends American Express. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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