American Express is good if you spend enough to use the rewards, but the annual fee and high spending requirements make it wrong for most people
American Express cards are not universally good or bad — they work well for specific spending patterns and poorly for others. The core trade-off is straightforward: Amex cards charge annual fees (usually $95 to $695) and require higher spending to break even on rewards than most Visa or Mastercard alternatives. If you spend $15,000 or more per year on categories the card rewards, the fee pays for itself. If you spend less, or if you carry a balance, the card costs you money.
The second factor is acceptance. American Express is accepted at roughly 99% of US merchants, but not all of them — some small businesses, gas stations, and regional chains still do not take it. If you need a card that works everywhere without exception, Amex creates friction. If you shop mostly at large retailers, restaurants, and online merchants, acceptance is not a real problem.
Key Takeaways
- Amex cards charge annual fees between $95 and $695, so you need to earn enough rewards each year to cover the fee or the card loses money.
- The rewards rates are competitive — typically 1% to 6% depending on the card and category — but only valuable if you actually spend in those categories.
- Amex is not accepted everywhere; roughly 1% of US merchants do not take it, so check whether your regular spending places accept the card before you open it.
- Amex cards often come with perks like travel credits, purchase protection, or lounge access that may or may not be worth the annual fee to you personally.
- If you carry a balance month to month, the interest rate on an Amex card is typically higher than on a no-annual-fee Visa or Mastercard, which makes the card expensive.
How Amex rewards actually work out in dollars
The math on whether an Amex card pays for itself depends on your annual spending and the specific card. The American Express Blue Cash Everyday has no annual fee and returns 1% on all purchases and 3% on US gas and supermarkets — that card makes sense for low spenders. But most Amex cards charge a fee.
Take the American Express Gold Card, which costs $250 per year. It returns 4% on US restaurants and 4% on US supermarkets (up to $25,000 per year, then 1%), and 3% on flights booked directly with airlines. If you spend $500 per month on restaurants and $300 per month on supermarkets, that is $9,600 per year in those categories. At 4%, that is $384 in rewards — enough to cover the $250 fee and leave you $134 ahead. But if you spend $200 per month on restaurants and $150 on supermarkets, that is $4,200 per year, worth $168 in rewards, which does not cover the fee.
The Amex Platinum Card costs $695 per year and is built for high spenders and frequent travelers. It returns 5% on flights booked through Amex Travel and 1% on most other purchases. It also includes a $200 annual airline fee credit and a $200 Uber credit. If you use both credits, the card effectively costs $295 per year. At that price, you need to spend roughly $30,000 per year on the card to break even on rewards alone — but the credits and perks may justify the fee even if you spend less. The card only makes sense if you actually use the credits.
Acceptance and where Amex does not work
American Express is accepted at the vast majority of US merchants, but the exceptions matter if they are places you shop regularly. Gas stations are the most common problem — many independent and regional gas stations do not take Amex, though most major chains (Shell, Chevron, Exxon) do. Some small restaurants, local shops, and regional grocery chains also decline it. Costco historically did not take Amex, though that changed in 2024.
The practical impact depends on your spending. If you buy gas at Shell or Chevron, eat at chain restaurants, and shop at major supermarkets, you will rarely hit a merchant that does not take Amex. If you frequent local restaurants, independent gas stations, or regional chains, you will need a backup card. Many people who carry an Amex card also keep a Visa or Mastercard for the places Amex does not work.
Interest rates and what happens if you carry a balance
American Express credit cards typically charge higher interest rates than comparable Visa or Mastercard products. An Amex card might charge 18% to 24% APR, while a no-annual-fee Visa card might charge 16% to 22% APR. The difference is not huge, but it matters if you carry a balance.
If you plan to pay your balance in full each month, the interest rate does not matter — you pay no interest regardless. But if you carry a balance, the higher rate means you pay more in interest charges. Combined with the annual fee, an Amex card becomes expensive fast. For example, if you carry a $5,000 balance at 20% APR for a year, you pay $1,000 in interest. Add a $95 annual fee, and the card costs you $1,095 that year in fees and interest alone. A no-annual-fee card at 18% APR would cost $900 in interest — a $195 difference.
Perks and protections that come with the card
Most Amex cards include benefits beyond the rewards rate. The Gold Card includes purchase protection (covers items you buy if they are damaged or stolen within 90 days), return protection (extends the return window to 120 days), and extended warranty coverage. The Platinum Card adds access to airport lounges, travel insurance, and concierge services. These perks have real value if you use them, but they are not valuable if you do not.
The most commonly used perk is the travel credit. The Platinum Card's $200 annual airline credit can be used on any airline, including baggage fees and seat upgrades. If you fly once or twice per year, this credit alone can cover a significant portion of the annual fee. But if you do not fly, the credit is worthless. Before opening an Amex card, list the perks it offers and honestly assess whether you will use them.
Comparing Amex to Visa and Mastercard alternatives
The main competitor to the Amex Gold Card is the Chase Sapphire Preferred, which costs $95 per year and returns 2% on restaurants and travel, and 1% on everything else. The Sapphire Preferred is cheaper and accepted everywhere, but the rewards rate is lower. If you spend $10,000 per year on restaurants and travel, the Gold Card (4% back) earns $400 versus the Sapphire Preferred (2% back) earning $200. After the $250 Gold fee and $95 Sapphire fee, the Gold Card nets you $55 more — but only if you spend heavily in those categories.
For everyday spending with no annual fee, the Chase Freedom Unlimited (1.5% back on everything) or the Capital One SavorOne (3% on restaurants and groceries, 1% on everything else) are simpler choices. They cost nothing and work everywhere. The trade-off is lower rewards rates, but if you spend less than $15,000 per year on the card, the lower rate still beats paying an annual fee.
When an Amex card makes sense and when it does not
An Amex card is a good fit if you meet most of these conditions: you spend $15,000 or more per year on the card, you spend heavily in the categories the card rewards (restaurants, travel, or supermarkets), you pay your balance in full each month, you fly at least once per year (if the card includes travel credits), and you shop mostly at merchants that accept Amex. If you meet four or five of these, the card probably pays for itself.
An Amex card is a poor fit if you spend less than $10,000 per year on the card, you carry a balance month to month, you shop frequently at merchants that do not take Amex, or you do not use the perks the card offers. In those cases, a no-annual-fee card with a lower rewards rate will cost you less money over time.
Frequently Asked Questions
Does Amex have a better rewards rate than Visa or Mastercard?
Amex rewards rates are competitive but not universally better. The Amex Gold Card returns 4% on restaurants and supermarkets, which beats most Visa cards. But Amex charges $250 per year, while many Visa cards charge nothing. The higher rewards rate only saves you money if you spend enough to cover the annual fee.
Can I use an Amex card everywhere?
Amex is accepted at roughly 99% of US merchants, but not all. Gas stations and small businesses are the most common exceptions. If you shop mostly at large retailers and chain restaurants, acceptance is not a problem. If you use independent gas stations or regional shops regularly, you will need a backup card.
What happens if I carry a balance on an Amex card?
Amex cards typically charge higher interest rates than Visa or Mastercard (18% to 24% versus 16% to 22%), and you also pay the annual fee. If you carry a balance, the card becomes expensive quickly. Amex cards are designed for people who pay in full each month.
Is the annual fee worth it?
The annual fee is worth it only if you earn enough rewards to cover it and use the perks the card offers. If you spend $15,000 or more per year in the card's reward categories and use the travel credits or other benefits, the fee pays for itself. If you spend less or do not use the perks, a no-annual-fee card costs less.
Should I close my Amex card if I am not using it?
If the card has an annual fee and you are not using it, closing it makes sense — you stop paying the fee. If the card has no annual fee, keeping it open does not cost you anything and may help your credit score by keeping your available credit higher. Check your card's terms to see if it charges an annual fee.