The American Express Cash Magnet Credit Card Review
American Express launched a new card yesterday, the American Express Cash Magnet. I have to say I am pretty underwhelmed by it. The card looks beautiful, I just wish the functionality matched the design. Having said that let’s take a look under the hood and see if you agree with my sentiment.
Current Sign Up Bonus
The sign up bonus is a tiered bonus where you can end up snagging $300 in statement credits when it is all said and done. The breakdown is as follows:
- Earn $150 back after you spend $1,000 or more in purchases with your new Card within the first 3 months of Card Membership.
- Earn an additional $100 back after you spend an additional $6,500 in purchases within your first 12 months.
Since this is the first offering for the American Express Cash Magnet it sets the bar as the all time high bonus. I would imagine the offer will drop below this once the limited time offer ends.
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Bonus Restrictions
Note that American Express currently has a “one bonus per product per lifetime” policy and you are only eligible for this bonus if you have not had this card before. This shouldn’t be an issue since this is a brand new card.
American Express will only approve 1 credit card every 5 days. They will also only approve 2 credit cards in a rolling 90 day period. American Express only allows people to have 4 or 5 credit cards at one time as well (the number varies by person). These numbers do not include charge cards.
These rules may come into play if you have recently applied for an American Express card or two. Charge cards, like the American Express Platinum, do not come into play with these figures, only credit cards.
Earning Structure
The American Express Cash Magnet card is about as straightforward as it gets. You earn the following:
- 1.5% cash back on every single purchase.
Cardmember Perks
There are not a lot of perks for this card since it is an entry level card. The card’s perks are as follows:
- Access to Amex Offers
- 0% APR for the first 15 months
- Car rental loss and damage insurance (secondary coverage)
- Extended Warranty
- The length of your warranty can be matched for up to 1 additional year when you use your American Express card for eligible purchases that come with an original U.S. manufacturer’s warranty of 5 years or less.
- Phone insurance
- Up to 90 days and $1,000 per occurrence, $50,000 per calendar year.
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Fees
The American Express Cash Magnet card has no annual fee.
Sign Up Bonus Value – $250
The sign up bonus has a total value of $250 and since there is no annual fee you get the full amount.
Summary
The American Express Cash Magnet is a peculiar offering from American Express. It is a straightforward 1.5% cash back card in the vein of the Capital One Quicksilver. That is a card that has been around since 2013. Why wait until now to release a competitor?
If the Cash Magnet is supposed to compete with the Chase Freedom Unlimited (more likely) then why not have it earn Membership Rewards points. The Freedom Unlimited’s rewards are two fold because it earns cash back but the Ultimate Rewards points are transferable with a premium Chase product. It offers the best of both worlds.
Getting past that portion of it, overall, the card isn’t all that exciting. 1.5% is a thing of the past. Especially since 2% cash back cards, like the Citi Double Cash, are easily available.
The sign up bonus, $250, is better than most no annual fee cards but it comes with a huge amount of spend. The true bonus, $150 after $1000 in spend is actually worse than most that offer $200 after $500 in spend.
There just really isn’t a whole lot to like about this card outside of the beautiful design of the actual card. It is tempting just for that :)!
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Long Term Keep or Cancel
Since the card has no annual fee it is hard to say it isn’t a long term keeper. It will still bring valuable Amex Offers. But it will be taking up one of the 4 or 5 very valuable American Express credit card slots. Some people may end up canceling the card down the road because of that.
Conclusion
The American Express Cash Magnet is a card that feels like it joined the party 5 years too late. The rewards set up isn’t all that compelling when 2% cash back cards are readily available with the same terms. The sign up bonus is above average for a no fee card but it also comes with a minimum spend requirement that is 15 times more than the norm. It is hard to see who this card would benefit.
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Yes
I will suggest that this card isn’t designed for the travel/MS crowd. I realize that I am in the minority among readers here, but I am more interested in cash rewards/discounts.
The suggestion of MR points as a reward wouldn’t work for non-travel redemption. MR points are cumbersome and less valuable than TY or UR points (or even SYWR, Plenti, BR or Discover).
Access to Amex offers with no annual fee sounds great for those of us under the limit. I’ll sign up for the 16.5% back plus another 3.8% back.
Not trying to sway you, just explaining that there are other motivations for some readers. As a reseller, most of my spend is organic and every little bit of discount helps. I follow the travel spend blogs for the great deals.
Keep up the great work!
Dave you have to be the only person I have ever seen say SYWR or Plenti points are more valuable to MR points, much less ThankYou points :). But everyone values points differently.
Most people, who are looking for cashback, would be better off getting a Blue Cash ($200 after $1000 in spend…much better than $300 after $7500) or Blue Cash Preferred.
The majority of people who sign up for this will be because they don’t really know better. A simple 2% card would better. Or if they are bonus hunting go for a $200 Chase AARP or BOA MLB card…40% return on $500 in spend.
You and I have disagreed before on MR points in other posts (on the Blue Business Plus). I can never get less than a penny of value from most points, MR are the exception. For cash or merchant spending you get less. I usually cash them in for G/C but never seem to even get those occasional discounted redemptions. TY points are closer to MR in their deficiencies, so I use them for SYWR.
I have the two major 2% cards and the old Blue Cash Preferred as well as the pointless F/U (product change from a long-held card). I would consider some of the cards you mention but I don’t churn cards and can’t see a reason to hold those. This card is one I would hang on to, if just for the Amex offers. My Blue Cash and Simply Cash earn just 1% when taking advantage of the offers by comparison.
It’s not that the store points systems are wonderful but you can stack, use G/C and coupons.
This is why they make 31 flavors of ice cream!
Looked it up. Yep. Weird.
Yeah I copied the terms from their offer – very weird indeed. I am sure some people will try to abuse it.
$50K/year in phone insurance?