TPG reader credit card question: What premium credit card should I use for all spending?

Mar 9, 2020

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Editor’s note: This article is part of a column to answer your toughest credit card questions. If you would like to ask us a question, tweet us at @thepointsguy, message us on Facebook or email us at info@thepointsguy.com. 

It’s almost time for spring cleaning. That probably entails purging your closet (unless you’re a bit of a clothes hoarder like me), dusting for the first time in weeks (er, months?) and deep-cleaning the kitchen. For many TPGers, it also means taking a hard look at the credit cards we use for everyday spending to decide what’s worth keeping and how we should adjust our spending on each card. Reader Dominick S. has a question along these lines:

If you were to choose just one premium card to put all spending on which would it be?

I am trying to simplify my life and having to remember which card to use is becoming a hassle.

Thanks for the help!

DOMINICK S.

First, let’s define “premium card.” Most of the time, we are referring to cards with high-end perks and annual fees over $400. For this question, I’m going to extend the definition to include any card with an annual fee of $250+ because there are a few cards with mid-level annual fees that offer premium perks.

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In This Post

Now, let’s look at your premium card options with annual fees ranging from $250 – $550:

Card Earning structure (% return based on TPG valuations) Annual fee
The Platinum Card® from American Express 5x Membership Rewards on airfare booked directly with the airline or through Amex Travel (10% return on spending)

5x Membership Rewards on prepaid hotels booked through Amex Travel (10% return on spending)

1 Membership Reward per dollar spent on everything else (2% return on spending)

Terms Apply

$550
(see rates and fees)
Chase Sapphire Reserve 10x Ultimate Rewards points on Lyft (20% return on spending)

3x Ultimate Rewards points on dining (6% return on spending)

3x Ultimate Rewards points on travel (6% return on spending)

1 point per dollar spent on everything else (2% return on spending)

$550
Citi Prestige® Card 5x ThankYou points on air travel (8.5% return on spending)

5x ThankYou points at restaurants (8.5% return on spending)

3x ThankYou points on hotels (5.1% return on spending)

3x ThankYou points on cruise lines (5.1% return on spending)

1 point per dollar spent on everything else (1.7% return on spending)

$495
American Express® Gold Card 4x Membership Rewards points on restaurants worldwide (8% return on spending)

4x Membership Rewards points at U.S. supermarkets on up to $25,000 per year; then 1 point per dollar spent (8% return on spending)

3x Membership Rewards points on flights booked directly with airlines or on amextravel.com (6% return on spending)

1 point per dollar spent on everything else (2% return on spending)

Terms Apply

$250 (see rates and fees)

The information for the Citi Prestige has been collected independently by The Points Guy. The card details on this page have not been reviewed or provided by the card issuer.

As you can see, some premium cards offer better rewards on spending across several categories.

You’ll notice that I left out airline credit cards and hotel credit cards. To keep it simple, I’m going to focus on the cards that earn transferable currencies. Cobranded credit cards earn points and miles that are almost always less valuable when it comes to everyday spending. They are great for travelers loyal to a specific travel brand, but I’m focusing on stand-alone credit cards for all spending.

Let’s take a deeper dive to figure out which premium card might be the best option for Dominick.

The Platinum Card® from American Express

(Photo by Wyatt Smith/The Points Guy)
(Photo by Wyatt Smith/The Points Guy)

 

Although The Platinum Card® from American Express is definitely one of the top travel credit cards (and the winner of TPG’s most recent battle of the premium credit cards), it falls short in the area of earning rewards on everyday spending. You’re getting a nice welcome bonus of 60,000 points after you spend $5,000 in the first three months — worth $1,200 according to TPG valuations — to start with.

The 5x bonus on airfare booked directly or through Amex Travel makes the earning potential on this card pretty limited beyond that.

There is a scenario where having only The Platinum Card® from American Express still makes sense despite the limited bonus categories: The value you get out of the card’s perks and benefits outweighs the value of the rewards you’d get by charging your spending to another card.

Here’s a rundown of TPG’s estimated value of a few of the Amex Platinum’s benefits:

That’s over $3,500 in annual value, not even including the current welcome bonus or perks that are harder to quantify, such as Centurion Lounge access, access to Amex Fine Hotels & Resorts and Uber VIP status. If you don’t think you’d get that much in value from other credit cards with broader spending categories, this is still a great option.

Related reading: Amex Platinum review

Citi Prestige® Card

Unless you spend a ton on travel purchases aside from airfare, hotels and cruises -- or make a lot of entertainment purchases -- the Prestige is likely a better option.
(Photo by The Points Guy)

The Citi Prestige® offers a nice return across an array of spending categories and, with an annual fee of $495 per year, it’s one of the only “ultra-premium” credit cards that hasn’t increased its fee to $550+.

If the majority of your spending is on travel and restaurants, you can rack up a ton of ThankYou points with this card. Those are the only spending categories you have at your disposal, but that can potentially stack up over the course of a year.

According to U.S. Bureau of Labor Statistics data, the average American expects to spend approximately $300 on dining per month. Additionally, Bankrate’s 2019 Summer Vacation survey claimed the average American expected to spend almost $2,000 on vacations.

Going off that information, let’s say you spend approximately $1,000 on airfare per year, an additional $1,000 on hotels and/or cruises and $3,500 on dining. Assuming you’re spending $1,000 monthly on non-bonus spending, that would total $12,000 per year on non-bonus spending.

At the end of the year, you’d earn 37,500 ThankYou points, worth about $637 according to TPG valuations.

Keep in mind that the Citi Prestige is one of the cards affected by devaluations over the past year, which lessens its appeal to many frequent travelers.

Related reading: Citi Prestige Review

Chase Sapphire Reserve®

(Photo by Wyatt Smith)
(Photo by Wyatt Smith/The Points Guy)

The Chase Sapphire Reserve® starts by offering 50,000 points after you spend $4,000 on purchases in the first three months of account opening, worth $1,000 according to TPG valuations. On spending, you’ll get 3x on travel and dining purchases worldwide. That may not sound like much, but remember that Chase defines both travel and dining broadly, so you’re getting a 6% return on far more than just airfare and hotels.

Using a similar example as the Citi Prestige, let’s say you’re spending $4,500 on airfare and dining each year, $1,000 on hotels or cruises and $12,000 on non-bonus spending. That’s 37,500 Ultimate Rewards points per year, worth about $750.

Similar to the Amex Platinum, you also need to consider the value of the perks you get with the card — Priority Pass lounge access, an easy-to-use $300 travel annual credit and amazing travel protections that can save you real money in the event of travel delays or cancellations. These benefits make a compelling argument for using this card for all of your spending — even if there are technically cards out there that could earn more points. 

To put it in context, The Points Guy himself, Brian Kelly, says that the one premium card he’d choose for all spending is the Chase Sapphire Reserve®.

Related reading: Chase Sapphire Reserve review

American Express® Gold Card

(Photo by Isabelle Raphael)
(Photo by Isabelle Raphael/The Points Guy)

Last but not least is the American Express® Gold Card. This card is sometimes overlooked because it doesn’t quite fit in with the high-end cards with $400 annual fees or the mid-tier cards that hover at around $95.

But there is a lot to love about it. You’re getting a great 8% return on spending with 4x points at U.S. supermarkets (up to $25,000 per year; then 1x) and 4x on dining worldwide. Plus there’s a nice 6% return on airfare (at 3 points per dollar spent) booked directly with the airline or Amex Travel.

I use my American Express® Gold Card for a solid portion of my own monthly spending. The U.S. Bureau of Labor and Statistics reports that the average American spends approximately $375 on groceries each month. Let’s say you’re spending $4,500 per year at U.S. supermarkets, $3,500 on dining, $1,000 on airfare, and $9,000 on non-bonus spending. That means 44,000 Membership Rewards points over the course of a year, which is worth $880 according to TPG valuations.

Plus you still get to take advantage of Amex Offers (which can help you earn rewards and save money on some non-bonus expenses) and earn valuable Membership Rewards without paying a super high annual fee.

The card even comes with a few premium benefits like up to $120 per year in dining credits (which I easily use on my own card) and an up to $100 airline fee credit. It’s actually the one card that I couldn’t live without and worth strong consideration if you are downsizing your wallet.

Related reading: American Express® Gold Card review

Bottom line

Asking credit card enthusiasts which premium card they would put all of their spending on sometimes feels like asking us to pick a favorite child. It really comes down to your spending habits and what you’re looking for.

Personally, I’ll sacrifice some of the more luxury perks in order to maximize as much of my spending as possible for earning rewards. That’s why I love my American Express® Gold Card. However, some people are willing to give up higher earning rates for benefits like complimentary elite status or lounge access.

This should be a good start in helping Dominick narrow down options and figure out which premium card is the best choice for him.

Featured image by The Points Guy

For rates and fees of the Amex Platinum Card, please click here.
For rates and fees of the Amex Gold Card, please click here.

American Express® Gold Card

With some great bonus categories, the American Express Gold Card has a lot going for it. The card offers 4x points at restaurants worldwide, at U.S. supermarkets (up to $25,000 per calendar year; then 1x), and 3x points on flights booked directly with airlines or through amextravel.com.

Apply Now
More Things to Know
  • Earn 35,000 Membership Rewards® points after you spend $4,000 on eligible purchases with your new Card within the first 3 months.
  • Earn 4X Membership Rewards® Points on Restaurants worldwide, including takeout and delivery.
  • Earn 4X Membership Rewards® points at U.S. supermarkets (on up to $25,000 per calendar year in purchases, then 1X).
  • Earn 3X Membership Rewards® points on flights booked directly with airlines or on amextravel.com.
  • $120 Dining Credit: Earn up to a total of $10 in statement credits monthly when you pay with the Gold Card at Grubhub, Seamless, The Cheesecake Factory, Ruth's Chris Steak House, Boxed, and participating Shake Shack locations. This can be an annual savings of up to $120. Enrollment required.
  • $100 Airline Fee Credit: up to $100 in statement credits per calendar year for incidental fees at one selected qualifying airline.
  • No Foreign Transaction Fees.
  • Annual Fee is $250.
  • Terms Apply.
  • See Rates & Fees
Intro APR on Purchases
N/A
Regular APR
See Pay Over Time APR
Annual Fee
$250
Balance Transfer Fee
N/A
Recommended Credit
Excellent/Good
Terms and restrictions apply. See rates & fees.

Editorial Disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

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