American Express Cobalt Card Review

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The newest credit card in Canada is the American Express Cobalt Card, launched just last month. Most American Express cards have great rewards, but this card takes it to a new level, with 5 points per dollar on dining and groceries.

American Express Cobalt Card

American Express Cobalt Card

Improved Offer for the American Express Cobalt Card

The current bonus for the American Express Cobalt Card is 40,000 American Express MR points, split two ways. First, you earn 2,500 bonus points per month when you spend $500 in that month. When you add up the monthly bonus, it’s 30,000 points in the first year. You earn an additional 10,000 points when you spend $3,000 in your first three months of card membership. The 10,000 points bonus ends Jan 31, 2018.

However, you can almost double the points you earn with grocery and dining transactions, which earn 5 points per dollar. If you do that, the bonus adds up as follows:

  • Months 1-3: Spend $1,000 – Total Bonus: 32,500
    • 10,000 Minimum Spend
    • 7,500 Monthly Spend (2,500 x 3)
    • 15,000 Bonus Spend (3,000 x 5)
  • Months 4-12: Spend $500 – Total Bonus: 45,000
    • 22,500 Monthly Spend (2,500 x 9)
    • 22,500 Bonus Spend (4,500 x 5)

The total points you can earn spending just in groceries and dining yields 77,500 American Express MR points, and the total minimum spend in the first year is $7,500. The bonus is phenomenal and so attainable. While you may not spend $500 on groceries, it is very easy to “increase” that amount. The trick is gift cards. At my local store, you can buy gift cards for any store – gas, electronics, retail, office supplies, you name it. You will still get 5x points since the transaction will show up as in the groceries category.

Earning with the AMEX Cobalt Card

The best part about the American Express Cobalt Card is the bonus points you can earn for select transactions. First, you earn 5x points on Groceries, Dining, and Food Delivery Services. This is equal to a 5%+ return. If you spend only $1,000 a month on this category, you earn 60,000 Membership Rewards points. Furthermore, you earn 2x points on Transit, Gas and Travel, equal to a 2%+ return. In comparison, most other credit cards earn at most 1-2 points for these transactions.

American Express Cobalt Bonus Categories

American Express Cobalt Bonus Categories

This is the only credit card in Canada with a bonus multipler on Food Delivery and Transit. The closest other card with these bonuses is the Scotiabank Gold American Express, which earns only 4x points on groceries and dining, with a $50,000 calendar year cap. The Cobalt Card becomes much more attractive relative to the Scotiabank Gold if you are spending more than $25,000 in bonus categories a year. The Cobalt card has no cap or annual limit on the bonus points you can earn. This is game changing and is a major reason to keep the card beyond the first year.

Unfortunately, all other spend is at one point per dollar, making it more worthwhile to use the American Express Platinum/Business Platinum Card or the MBNA Rewards World Elite that earn, respectively, 1.25 Membership Rewards points and 2% Cashback per dollar. Personally, I’ll only be using this card for purchases on dining and groceries. As I already have the Business Platinum Card, I will be using that for other everyday purchases that don’t earn a bonus with the Cobalt Card. I wouldn’t recommend using this card for non-bonused purchases.

American Express MR Select Tier

The American Express Cobalt Card earns Membership Rewards Select points. These are only slightly different from regular AMEX points earned from the Gold or Platinum cards. The primary difference is that the points earned from the Cobalt Card cannot transfer into airlines. These are Aeroplan (1:1), BA Avios (1:1.25 – Transfer Bonus), Asia Miles (1:0.75), Delta Skymiles (1:0.75), Etihad Guest (1:0.75). However, there are still three excellent redemptions that can be made with MR Select points.

1. Transfer to Hotels

Points with the Cobalt Card can be transferred to two hotels programs Hilton HHonors (1:1), and Starwood Preferred Guest (2:1). Hilton is poor value, so Starwood is the best option here. Starwood also transfers at a 1:3 ratio. With the 5x bonus on Groceries and Dining, you earn 2.5 SPG points or 7.5 Marriott points. I value Starwood points at 2.25 USD cents apiece, so you are getting a 7.1%+ return.

Westin Whistler - A Starwood Property

Westin Whistler – A Starwood Property

Additional Reading: Best SPG Redemptions

2. Fixed Points Travel Program

The American Express Fixed Points Travel Program was released last year. It lets you use a set amount of miles for a flight, which is determined by a zone-based chart. There is a maximum ticket price that the points will cover, but you can buy a ticket that exceeds the amount if by paying the difference.

American Express Fixed Points Travel Rewards Chart - Economy

American Express Fixed Points Travel Rewards Chart – Economy

Notice that the maximum price is the base fare price; this excludes airport taxes and other fees. Take for example, my flight to PointsU Calgary, which is in two weeks. A round-trip flight costs 15,000 points, with a maximum base ticket price of $300. The flights cost $431.


The base fare is $346.

In this case, I pay $131, $46 being the fare difference and the rest being taxes and fees. My AMEX points cover $300 of the base fare, which is 2 cpm. Given you earn 5x points on bonus categories, you can get up to a 10% return!

3. Travel Purchases

With MR Select points, you can offset travel charges on the card at a rate of 10,000 points for $100, a 1 cpm value. This isn’t great, but is a good option if there are no other ways to use your points. You can also use points to erase other charges, but that is at a poorer value of 0.7 cpm.

With the 5x bonus on groceries and dining, you still earn a 5% return redeeming your points this way.

American Express Cobalt Card – Other Benefits

Just like other premium competitors, the Cobalt Card also comes with travel and shopping protections. This includes insurance for flight delays, lost baggage, car rentals, and more, as well as purchase protection and extended warranty. See the full list of coverage here. Overall, the American Express Cobalt Card is one of the best cards out there to reward purchases on groceries and dining, with 5x points per dollar.

This card has the best bonus categories all-around, and the monthly fee of $10 is very innovative. It’s bold for a credit card issuer to go back to the drawing board and create such a stunning new product. I’m excited to get the card soon, and hope other financial issuers make an attempt to match the new competition.

Apply for the American Express Cobalt Card today, and earn up to 40,000 Points!

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Comments

  1. How many American Express cards am I allowed and is this considered a charge card or credit card? I have spg, gold and biz spg. Will they also let me have this card if I qualify or will I have to give up another card? Thanks

  2. I got this card exclusively to use for groceries and the first year bonus because the SPG earn rate is better than my SPG Amex. Very happy with the points accumulation so far but there is a big problem.

    Data point: If you have an Amex SPG of any kind that one card is linked to your SPG account. Amex’s system will not let you link a Membership Rewards earning card to an SPG account if you have either SPG card. I tried to add it to my Biz Plat as a test and got the same error. I was able to successfully add my Hilton #, but when I try to add in my SPG number I get the same constant error. Amex’s only solution was to temporarily remove my SPG card and sub in the Cobalt, do the transfer, and then switch it back. The only other solution I can think of is to create an account for my girlfriend under my address and pool the points. Any thoughts?

  3. Thank you for mentioning that these points earned are not the same as the points earned on the Gold Rewards cards and do not transfer to airline points. That really is a game changer for me as I was enthused up to that point.

    Given the incredible difficulty experienced is actually using an AMEX card in Europe for anything other than gas or hotels I am keeping the number of AMEX cards to a minimum.

  4. The way they’re doing the annual fee is definitely interesting. Amex has sort of been doing that in Mexico, but they split it across 3 statements, so they do tell you that the fee is $1200 MXN or whatever, split up in 3 months, and that does lessen the impact somewhat.

  5. Best review of this card I’ve seen so far. Thanks for breaking down the earning potential as well beyond just what is stated on their site.

  6. “The primary difference is that the points earned from the Cobalt Card cannot transfer into airlines.”

    Is this accurate? When I search for all cards and filter by Membership Rewards, the Cobalt card still shows up! There is no mention of the Select program. If what you say is true I feel that the value of the card is significantly diminished for me. That would be too bad, it is one good looking piece of plastic!

  7. Sounds like it is definitely worth it for the first year. If I understand correctly, one would get 12 X 2,500 = 30,000 points for a $500 monthly spend for the second year. Is this correct? What are your thoughts re the second year? Worth keeping?

    Thanks for all you do!

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