American Express: Should You Upgrade From The Cobalt Card To The Gold Card?

American Express – Cobalt to Gold Card Upgrade Offer

Presently, American Express Canada is offering select American Express Cobalt^® Cardmembers the opportunity to upgrade to the American Express^® Gold Rewards Card.

Upgrade to a Gold Card now and you could earn 40,000 bonus Membership Rewards points by making $3,000 in purchases on your Card within the first three months of membership + you could earn 10,000 points by making a purchase between the 14th and 17th months of membership.

Let’s quickly compare the benefits of the American Express Cobalt^® Card and the American Express^® Gold Rewards Card.

American Express – Cobalt Card: Best for Points Accumulation

The American Express Cobalt^® Card is unbeatable when it comes to accumulating points: you can earn between 1 and 5 points per dollar.

This represents an average return of 1.7% to 8.5% on all these purchases, according to Milesopedia’s valuation of a Membership Reward point.

Just like the American Express^MD Gold Rewards Card, you can easily use these points as statement credit towards your everyday or travel purchases. The value is the same: 1,000 points = $10.

Or you can transfer them into Aeroplan points, Avios (British Airways, Qatar Airways and Finnair), Flying Blue, Marriott Bonvoy, Hilton Honors or ALL Accor.

The American Express Cobalt^® Card has monthly fees of $15.99 or $191.88 per year.

American Express – Gold Card: Best for Benefits and Travel

The American Express^MD Gold Rewards Card is not as generous when it comes to accumulating points: you can earn between 1 and 2 points per dollar.

This represents an average return of 1.7% to 3.4% on all these purchases.

Just like the American Express Cobalt^MD Card, you can easily use these points as Statement credit for your everyday or travel purchases. The value is the same: 1,000 points = $10.

Or you can transfer them into Aeroplan points, Avios (British Airways, Qatar Airways and Finnair), Flying Blue, Marriott Bonvoy, Hilton Honors or ALL Accor.

The American Express^® Gold Rewards Card has an annual fee of $250. This is about $60 more than the American Express Cobalt^® Card.

With a higher annual fee, this Card offers several benefits for travel:

• $100 Annual Travel Credit
• Priority Pass membership and four free visits per year to Canada’s Plaza Premium lounges
• Statement credit of $50 every 4 years for NEXUS application or renewal fees
• Gold or Rose Gold stainless steel metal options for your Card

By using the $100 travel credit each year, it’s as if the card only cost you $150, which is cheaper than the American Express Cobalt^® Card. In addition, you get 4 free accesses to Plaza Premium lounges in Canada (including the Air France Montreal-Trudeau YUL lounge).

On October 8, 2024, the earning rate for travel expenses on the American Express Cobalt^® Card changed from 2X to 1X points. Therefore, if you have a lot of expenses for hotels, airline tickets, train tickets, cruises, or other things, it may be advantageous to switch to the American Express^® Gold Rewards Card.

American Express – Gold or Cobalt cards: beware of abuse

With an offer to upgrade from the American Express Cobalt^MD Card to the American Express^MD Gold Rewards Card like this, you might be tempted to accept the offer and then sign up for the American Express Cobalt^MD Card again.

However, American Express has made provision for this case in the conditions relating to this upgrade offer:

Current or former Cardmembers with this Card are not eligible for this offer. If we determine you have engaged in any abuse related to the offer and/or program and/or you are not eligible for the offer, we reserve the right to forgo issuing the welcome bonus, deduct it from your account, and/or cancel your Card account(s) and you will not be eligible for a fee refund. Misuse may include applying for multiple Cards to earn points, applying for a new Cobalt Card or switching to a new Cobalt Card after upgrading, terminating or downgrading your Card account within 14 months of acquiring your Card, and cancelling or returning purchases made to earn points. Please refer to the Membership Rewards Program Terms and Conditions (americanexpress.com/en-ca/rewards/membership-rewards/terms) for additional examples of program abuse, as well as further information on the consequences of program abuse.

So don’t play with fire, or you’ll find your account audited and your future card applications rejected or even cancelled.

Bottom Line

So? What should you do if you are an American Express Cobalt^MD Card holder and American Express Canada suggests you upgrade to the American Express^MD Gold Rewards Card?

Start by analyzing your spending in 5-point purchase categories (grocery stores, restaurants, convenience stores, food delivery). And don’t forget the gift cards you can buy in grocery stores.

For example, if you spend $1,000 per month on groceries, restaurants and food delivery, you’ll earn 5,000 points or $50 cash back per month. That’s 60,000 points or $600 cash back per year with this card for this category of purchases!

By upgrading to the American Express^MD Gold Rewards Card, you will now earn only 2 points per dollar for groceries and only 1 point per dollar for restaurants, convenience stores and food delivery.

Truth be told, the purchase categories where the American Express^MD Gold Rewards Card stands out is in travel and pharmacy, offering 2 points per dollar (versus just 1 point for the American Express Cobalt^MD Card).

However, if you don’t have a lot of spending in the 5 points-per-dollar categories (or have another American Express Cobalt^MD Card in your household), upgrading from the American Express Cobalt^MD Card to the American Express^MD Gold Rewards Card may be worth considering to benefit from:

• The Welcome Bonus Offer
• The travel benefits

Personally, having received this offer myself (and being a holder of both Cards) I’m not going to accept it. Even if the offer seems tempting, I don’t want to part with the American Express Cobalt^MD Card, which I still consider to be one of the best credit cards in Canada.

It’s a card I renew year after year (and we’ll explain why here).

View this post on Instagram

A post shared by Milesopedia (@milesopedia)

Go further with American Express Membership Rewards

To maximize your Membership Rewards earning, check our complete American Express Membership Rewards program guide and our best American Express Membership Rewards credit cards ranking, updated monthly by the Milesopedia team.