Long-time MDJ readers will know that I typically don’t write about credit cards. I don’t have anything against them (in fact I definitely cash in thousands in credit card perks each year) it’s just that I like to focus more on investing money than on investing in credit cards!
When I do write about credit cards, I focus on no fee cards. Interestingly enough, my post on the Top Free Cash Back Credit Cards in Canada generated a lot of interest and discussion so it’s clear that many of you are using credit cards to your advantage.
I’ve had a lot of readers reach out to me about travel credit cards, but that’s not really my specialty (I prefer cash back) so I reached out to personal finance and travel expert, Barry Choi over at moneywehave.com for his take on the best travel card. I was shocked to hear that he recommends the Amex Platinum Canada Card that comes with a hefty $699 fee!
I would never spend that kind of money on a credit card, but Barry makes a pretty compelling case in today’s guest post from him.
If you read my American Express Platinum Canada Review, it’s easily my top pick when it comes to the best travel credit cards in Canada. You rarely see this card on other lists because it comes with an annual fee of $699, but when you look at the benefits it comes with, it’s clearly aimed at travellers.
Here’s the thing, if you’re a frequent traveller like me (I took more than 30 flights in 2020), then a credit card that comes with a lot of travel benefits is what you’re looking for. A sign up bonus of $250 plus 4-6 lounge passes just doesn’t cut it.
Whenever I’m on the road, I want to feel like a VIP and I believe the American Express Platinum Card gives frequent travellers that experience. Although the annual fee is high, when you break it down, you’ll realize that you can easily get way more value than $699. Still not convinced? Let me break it down for you.
American Express Platinum Benefits
- 60,000 American Express Membership Rewards points when you spend $5,000 in the first three months
- Earn 3 points per dollar spent on dining, 2 points per dollar spent on travel and 1 point per dollar spent on all other purchases
- CAD$200 annual travel credit
- Complimentary access to over 1,200 airport lounges across 130 countries
- Benefits at Toronto Pearson International Airport
- Hotel Status Benefit
- Fine Hotels & Resorts benefits
- Global Dining Collection benefits
- Travel insurance
- Buyer’s assurance
- Purchase protection
Some people will look at this list of benefits that come with the American Express Platinum card and will say they won’t use them so the $699 fee isn’t worth it. I don’t doubt that to be the case for many people, but there are a lot of frequent travellers who will look at this and see that all the benefits included are meant to give them a better travel experience. You’re basically paying for travel perks.
There’s no denying the $699 fee is high, but let’s breakdown the value of each individual benefit. You might be surprised to find out how much value there really is with the card.
Amex Platinum Welcome Bonus
The standard offer with the Amex Platinum card is 50,000 points when you spend $3,000 in the first three months of card membership. However, if you sign up with a referral link, you’ll get 60,000 points on a $5,000 spend.
With American Express Membership Rewards (MR), the base value of 60,000 points is worth $600. You also have the option to transfer your points to Aeroplan at a 1:1 ratio or to Marriott Bonvoy at a 1:1.2 ratio. That would give you 60,000 or 72,000 points in each respective program.
60,000 Aeroplan points are enough for two round trip tickets to anywhere within Canada and the continental U.S. while 72,000 points will get you up to 5 free nights at a category 3 Marriott owned property during standard times. Both of those options can easily be worth $1,000 or more.
Welcome bonus value = $600 – $1,000
Annual Travel Credit
As soon as you get the American Express Platinum Card, you’re given a travel credit of $200 which can be used immediately. This credit can only be used when making a travel purchase through the Amex travel portal, but since this credit is given to you annually on your anniversary, you’re effectively saving $200 a year. In other words, your annual fee is actually just $499 a year.
Annual travel credit value = $200
Unlimited lounge access
The American Express Platinum Card is the only credit card in Canada that gives you unlimited lounge access. Officially, you’ll get access to over 1,200 airport lounges across 130 countries. The network of lounges you get access to include Priority Pass Lounges, Centurion lounges and Amex international lounges, Delta Sky Club lounges (when flying on Delta), Plaza Premium Lounges, AirSpace and Escape lounges. That’s a lot of lounges so you’re pretty much covered regardless of where you’re in the world!
Let’s assume you’re going to visit a lounge 16 times this year. Since the Amex Platinum allows you to bring in a guest to the lounges, 16 visits work out to 4 round-trip flights. That’s not exactly a lot, frequent travellers will easily exceed that. Heck, casual travellers could easily make 16 visits in a year.
If you had to pay for those 16 visits, it would cost you a fair amount. A Priority Pass Membership is US$99 and then you need to pay $US32 per visit. That works out to about CAD$800. Of course, Priority Pass does have an unlimited lounge visit option, but that’s still USD$429 or CAD$560.
Even if we used 4 visits as a reference point since that’s what some other credit cards offer, that’s still worth at least CAD$300.
I understand that some people would never pay for lounge access, but many people (including me) swear by it. A good lounge makes the travel experience that much better.
Unlimited lounge access value = $560
American Express Platinum Travel Insurance
If you’re travelling, you need to have travel insurance so it’s a good thing that the Amex Platinum Card has you covered. If you’re under the age of 65, you get 15 days of travel medical coverage up to $5,000,000. This isn’t bad, but some would argue that 15 days isn’t enough and if you’re over 65, you get no coverage at all. Remember, with travel medical insurance, you’re covered no matter what.
When it comes to your additional travel insurance including trip cancellation, flight delay, baggage delay, car rental theft, hotel/motel burglary etc. you do need to charge the entire amount of the travel expenses to your Amex Platinum card for the insurance to be valid.
Non premium cash back credit cards, including no fee cards typically have no travel insurance included. That means you would either have to purchase an insurance policy every time you take a trip or get a multi-trip policy that would cover you for the year.
Travel insurance value = $300
Hotel Status Benefit
Another thing that will interest frequent travellers is the included hotel status benefits which give you the following:
- Hilton Honors Gold Status
- Shangri-La Golden Circle Jade membership
- Marriott Bonvoy Gold Elite status
- Radisson Rewards Gold Status
These benefits have no monetary value, but having hotel status does may give you extra benefits such as early check-in/late check-out, free WiFi, free breakfast, room upgrades and more. You might even get an increased earn rate on your points with status so maybe there is some extra value here.
Fine Hotels & Resorts Global Dining Collection
If you go to the American Express website, they say that the Fine Hotels & Resorts has an average total value of USD$550 at over 1,000 extraordinary properties worldwide. I don’t know how they calculated that number, but I do know that if you book one of these hotels, you get complimentary breakfast for two and a unique property benefit valued at $100 (usually a food or beverage credit). I conservatively value this benefit at about $150. However, since there’s no guarantee I’ll book an FH&R every year, I don’t assign it an actual value.
With the Global Dining Collection, you get exclusive reservation access and in-restaurant experiences which can be handy if you want to book a popular restaurant when you’re travelling, but it has no cash value.
Although these extra benefits may have no actual value, they do enhance the travel experience. You won’t get that with other credit cards.
American Express Platinum Value
When you add everything up, that’s about $1,660 – $2,060 in value you’re getting in the first year and I’m not even counting the points you would earn from your regular earn rate. Even after you subtract the $600 – $1,000 you get from the welcome bonus once you hit year #2, you’re still getting a yearly value of $1,060 which is still incredible.
Remember, you get the maximum value when you use a referral link since you get an additional 10,000 points after you meet the minimum spend. With those points, you’re going to come out ahead in year #1 no matter what. If you get the card and then find you’re not getting that much value, then cancel it before your annual fee kicks in for the second year.
The American Express Platinum Card isn’t for everyone, but there’s no denying the value. Casual travellers will likely be content with another travel credit card, but if you’re a frequent traveller, the Amex Platinum card should be on your radar.