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Avoid These 7 American Express Missteps in 2024

Applying for an American Express card can be a great way to earn rewards and enjoy various benefits. However, making the wrong moves can cost you hundreds or even thousands of dollars. Today, we’re going to explore some of the biggest mistakes you can make with American Express cards. Some mistakes might seem obvious, while others come from learned experience. Plus, a lot has changed in recent years, so you might be surprised. If you find this useful, please hit the like button to help with the algorithm, allowing more people to avoid the same pitfalls. If you’re new here, consider subscribing!

Mistake 1: Applying for Cards in the Wrong Order

One of the first mistakes to avoid is applying for American Express cards in the wrong order. This is about optimal strategy and maximizing the value you get. American Express offers a variety of cards, including the Green, Gold, and several Platinum cards (e.g., Platinum for Morgan Stanley and Platinum for Charles Schwab).

Here’s what you need to know:

  • Green Card: You are not eligible for a welcome offer if you have or have had this card.
  • Gold Card: You are not eligible for a welcome offer if you have or have had this card or any of the three Platinum cards.
  • Platinum Cards: You are not eligible for a welcome offer if you have or have had this card or any of the other Platinum cards.

To maximize value, apply for the Green card first, then the Gold, and finally a Platinum card. Skipping a step can be acceptable in some cases, but generally, following this order prevents leaving money on the table.

Mistake 2: Mistiming Upgrades

Another related mistake is mistiming your card upgrades. When upgrading from, say, the Green to the Gold or the Gold to the Platinum, you might either get nothing or receive an upgrade bonus. Ideally, you want to get the upgrade bonus, but there’s a hidden cost.

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For example, if you upgrade to the Platinum card, the “lifetime language” applies. This means you won’t be eligible for the welcome offer in the future because you have or have had the card, regardless of whether you received the bonus. To avoid this, apply for the card to get the welcome bonus first and then upgrade later to get the upgrade bonus.

Mistake 3: Not Waiting for Elevated Offers

Since you can only get the welcome offer once, make sure it’s a good one. If you’re not in immediate need of a card, wait for elevated offers. Use tools like CardMatch to see if you’re pre-qualified for elevated bonuses. For instance, many people report seeing a 90,000-point offer for the Gold card and a 150,000-point offer for the Platinum card, which are among the highest offers available.

Mistake 4: Ignoring Other Issuers’ Rules

Don’t overlook rules from other issuers like Chase. For example, Chase uses a 24- or 48-month clock for welcome bonuses:

  • Chase Sapphire Preferred: Not available if you are a current card member of any Sapphire card or have received a bonus in the last 48 months.
  • Chase World of Hyatt Card: Not available if you are a current card member or have received a new card member bonus in the last 24 months.

The best strategy might be to start with Chase, enjoy their cards, and then move to American Express, returning to Chase when you are eligible again.

Mistake 5: Underestimating Card Issuer Algorithms

Card issuer algorithms, like Chase’s 5/24 rule, can affect your approval odds. If you have five or more new cards in the past 24 months, you’re likely to be rejected. Capital One is also known for rejecting high-velocity applicants, even with excellent credit scores. The ideal path is to start with Chase due to the 5/24 rule, then move to Capital One, and finally to American Express.

Mistake 6: Overvaluing Credits

Overvaluing credits, like the Uber credit, can be a mistake. For example, if you rarely use Uber, the credit might not be valuable to you. Some people find credits more stressful than beneficial. Evaluate whether the credits fit your lifestyle. If they don’t, discount their value or even ignore them when calculating a card’s worth.

Conclusion

American Express cards offer numerous benefits, but avoiding common mistakes is crucial to maximizing value. Remember to:

  1. Apply for cards in the optimal order.
  2. Time your upgrades wisely.
  3. Wait for elevated offers.
  4. Consider rules from other issuers.
  5. Be aware of card issuer algorithms.
  6. Evaluate credits realistically.

For more details on card strategies and offers, check out Ask Sebby. If you found this helpful, hit the like button, and subscribe for more tips!

Questions for the Community:

  1. Have you made any American Express mistakes?
  2. What’s your favorite American Express card?
  3. What’s your favorite non-American Express card?

Share your thoughts in the comments below!