Is the Amex Platinum Card Still Worth It? My Experience with the Annual Fee Increase

Every few months, I have what I call “Look At Money Time.” It’s when I check my credit cards and bank accounts to see what’s happening financially. I ponder which subscriptions may have slipped my mind, how I’m doing with retirement, and whether I’ve overindulged on food delivery. Lately, my main concern has been my American Express Platinum card. Last year, I wrote about the allure of Amex for Gen Z, and now, I find myself swayed despite its hefty annual fee of $895—a $200 increase that transforms my reflection into a financial anxiety fest.

The Amex Platinum card, launched in 1984, is known as one of the most luxurious credit cards, rivaled only by the Chase Sapphire Reserve. Both offer perks that feel high-end, yet come with significant costs. According to Ted Rossman, a senior analyst at Bankrate, “These cards are at the high end for the mass market.” This raises the question: Is it still a mass-market product?

As society becomes more divided economically, high-reward credit cards symbolize status. They provide exclusive perks that can sometimes feel more like a noose than a luxury, especially for those not keen on counting points. Is access to a crowded airport lounge worth 1% of the U.S. median income? I’ve enjoyed my Amex experience, but I have my reservations.

Traditionally, Amex was the card for wealthier folks. It had a stigma, often not accepted by many merchants. But times have changed. Today, young consumers, especially Millennials and Gen Z, make up 60% of Amex’s new clients globally. The company is banking on this demographic’s loyalty, even with the fee hike.

To justify the increased cost, Amex is introducing new benefits valued at up to $3,500. These include $400 worth of credits for dining through Resy and other perks with popular brands like Lululemon and Uber. They’ve added another $300 credit for digital streaming services like YouTubeTV and Paramount+. While these improvements make the card more appealing, I still have my doubts.

Nick Ewen from The Points Guy notes, “Those benefits can easily outweigh the increased annual fee — the key word being ‘can.’” I read through all the added benefits and initially feel compelled to keep my card. But after a week of scrutinizing my usage, I realize how unorganized I am. I’ve utilized the Walmart+ credit, but haven’t shopped there. I enrolled in streaming services but forgot to apply my Platinum card for discounts. I even purchased a less-than-desirable item from Saks just to use my $50 credit—evidence of Amex pressure.

Michael Miller, a Morningstar analyst, describes the Amex Platinum card as a “high-end coupon book.” In other words, users need to adapt their spending habits to make the most out of their memberships. While Amex maintains a 98% retention rate among Platinum customers, it’s a delicate dance. Ewen expresses curiosity about how high these annual fees can go, questioning whether we’ve reached a ceiling yet.

Interestingly, Amex’s executive VP said customers are willing to pay for the benefits they receive. However, if some users choose to walk away, Amex has alternative plans. Their partnerships with businesses can draw high-income customers even if they lose some cardholders. This strategy allows merchants to engage affluent Amex clientele, with partners covering over 25% of the reward costs.

Rossman points out that this shift focuses on attracting a luxury audience. “If they lose some customers, that could actually be beneficial,” he states. With new lounge openings and a shift toward a more lifestyle-oriented card, Amex is working to sustain its high-value offering while creating an ecosystem for affluent users.

However, I’ve received mixed feedback from other cardholders. Jim Hennessy, a long-time member, shares his hesitations about the crowded lounges, voicing concern over the card’s exclusivity fading. Meanwhile, Amex continues to invest in lounge expansions worldwide to enhance user experiences. Despite the negative feedback surrounding overcrowding, Rossman insists that cash-back cards are still the most popular choice among Americans, highlighting the diversity in consumer tastes.

As I weigh the financial implications of keeping my Amex, the pressure builds. Friends have varied opinions; some are die-hard fans, while others are contemplating cheaper alternatives. For many, the cost becomes too much, especially if circumstances change. A positive aspect is the new app functionality that tracks benefits usage, although it requires manual enrollment for many perks. For now, I’m fortunate enough to pay off my balance monthly. Yet, the reality remains that rewards cards often represent wealth transfers from the less affluent to the more affluent.

Ultimately, I have a bit of time to decide on my Amex situation before the fee hike kicks in. My indecision hints I might be better off canceling, but there’s a part of me that hopes I can become more organized with my spending. After all, navigating the complex benefits of the Platinum card requires effort that not everyone is eager to invest. As Miller puts it, “You do have to kind of go along with the game here.”

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