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How you can justify paying $599 CAD for an American Express Platinum credit card (at least the first year)

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Written by K. Amjad

15th June
2022

American Express cards are amongst the most premium cards in Canada due to the high perks, high annual fee, and the traditionally expensive merchant fees. The American Express platinum card is largely considered the best credit card out of the lot. There are a lot of articles available on the web which layout why that is the case. This article will justify why the card is worth it for the first year even without making travel the primary usage of this card,

American Express Offers

American Express has (statement) offers which are credits provided for transactions with preferred merchants. The offers become available on an ad-hoc basis. This is the biggest non-travel perk available since merchants, including grocers, retailers, and restaurants offer credits through American Express for doing business with them. I will justify a portion of my annual fee through these promotions, transactions, and credits. I have omitted travel-oriented offers which will are availed on a case by case basis. During my last year, the sum of the savings from (non-travel) offers is $390 CAD. I availed the following offers with the corresponding credits:

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Finding Promo Code Sellers

Offer Date
Retailer Descriptions
Offer Descriptions
Savings CAD$
24/08/2022
Shop Small. This is a scheme by American Express to incentivize consumers to spend more at small businesses.
Spend $10 and get $5 back. Up to 5 times.
25
New American Express Aeroplan Reserve card holders welcome bonus.
7X POINTS: On eligible eats & drinks in your first 3 months (up to 20,000 points). 20000 points = $200 CAD
200
20/12/2022
Lululemon a casual and activewear company
Spend at least $100 at Lululemon (online or in app) and earn a $20 statement credit
20
31/12/2021
Christmas retailers
Spend at least $50 online at Best Buy, Hudson’s Bay, Indigo, Simons or Urban Barn and Earn a $20 credit
20
30/06/2022
Shell, the gas station
Spend at least $60 and earn a $5 credit at Shell. Up to 4 times.
20
18/07/2022
Oxford Properties owns several malls in Canada such as Yorkdale. The gift card can be used at any of their locations.
Spend at least $350 on an Oxford Properties gift card and earn a $70 credit
70
08/09/2022
Voila is a grocery delivery and subscription service by Sobey's, the grocery store.
Spend at least $75 and earn a $40 credit
40
20/12/2021
Offer could be used with any major telecom company; TELUS, Bell, or Rogers.
Earn 4 bonus points for every $1 in qualifying purchases. Up to 2000 points. 2000 points = $20 CAD.
20
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A few example of Kijiji interactions purchasing promo codes

Ticket Fare: $2254 CAD

Base Fare:         $1378 CAD

Other Fees:       $876 CAD

Ticket Fare: $1841 CAD

Base Fare:         $964 CAD (1378x70%)

Other Fees:       $876 CAD

______________________

Saving:               $413  CAD (2254-1841)

Cost of Promo  $300 CAD

______________________

Overall Saving  $113 CAD

X

2=

Ticket Fare: $4508 CAD

Base Fare:         $2756 CAD

Other Fees:       $1752 CAD

Ticket Fare: $3682 CAD

Base Fare:         $2756 CAD  (2756*70%)

Other Fees:       $1752 CAD

______________________

Saving:               $826 CAD

Cost of Promo  $300 CAD

______________________

Overall Saving  $526 CAD

Above is an illustration of how we save $526 CAD using the 30% off base fare promo code on a sample Toronto to Dubai fare. For two passengers, the overall ticket fare was reduced by $826 CAD using the promo code, which itself cost only $300 CAD, the result netting me $526 CAD in savings.

Finding vouchers or gift cards

In conjunction with promo codes you can use airline vouchers or gift cards. At the beginning of the pandemic when flights were cancelled, airlines initiated a policy whereby they gave proprietary credit to their customers for the value of the cancelled ticket in the form of e-vouchers. Since customers did not receive refunds in their original form of payment (credit cards, cash, or cash-equivalent) they have no choice but to use the credit with the same airline for future travel.

 

An economic primer on why this works:

Most individuals splurge or spend a decent proportion of their disposable income on vacation expenses. When the individuals is no longer able to travel and that large sum of disposable income gets locked into propriety credit, it's not very economical or useful for them to keep their money in such an illiquid form (it is illiquid because the value can be used in only one way - with the airline). Individuals who want the monetary value  of the e-voucher only have the option of reselling it on a marketplace at a discount. This is because airlines do not exchange the vouchers for cash or cash equivalents - unless you expend a lot of energy arguing with them and can make a considerably good argument in your favor.

 

In addition, as the vouchers only purpose is to use towards a transaction with the airline, when the individual decides to sell they have to find a buyer who is willing to find a use for the voucher, A buyer would not be incentivized to buy the e-voucher at face value as they could use their own form of payment directly with the airline. As a seller, the individual is forced to sell the voucher at a discount which incentivizes buyers in the market and then inevitably liquidates your position.

Now back to finding vouchers:

The people who purchase these vouchers are travelers who are comfortable travelling during the pandemic, or people who foresaw a use for the vouchers in the long term. During the pandemic, the number of people making up this demographic was a very small one.

 

In my experience, these vouchers are sold at anywhere between a 10%-30% discount for vouchers containing less than <$1000 CAD and anywhere between 5%-20% discount for vouchers above $1000 CAD.

There is still time for you to take advantage of this illiquidity as many travel vouchers have become available after the most recent Covid wave (March 2022). Many traveler's received e-vouchers 6-8 weeks after cancelling their plans (turn around time). This has created a large supply of travel vouchers, many of which can now be found in online marketplaces, discounted from their face value.

Below is a screenshot of Air Canada travel vouchers that are being sold on Kijiji (as per writing this article). If I were to purchase the second option on the list then I have $1173 CAD to use towards my next flight for which I only had to pay $900 CAD.

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On online marketplaces I have seen Air Canada, WestJet, Etihad, and Tap Portugal vouchers frequently becoming available. Airlines like Emirates and Qatar have provided customers refunds directly to their original form of payment, and therefore you will not see vouchers being sold for their airlines.

30% off promo code

Ticket Fare: $1841 CAD

Base Fare:         $964 CAD (1378*70%)

Other Fees:       $876 CAD

______________________

Net Promo Saving    $113 CAD

______________________

Savings 30% Promo: $413 CAD

Cost of Promo:          $300 CAD

Applying a discounted voucher

If we pay this ticket using the voucher which contains $1173 CAD for which we paid a discounted price of $900 CAD, then we have saved $273 CAD

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Net Voucher Saving:$273 CAD

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Voucher Value:         $1173 CAD

Voucher Purchase:  $900 CAD

Ticket Fare: $2254 CAD

Base Fare:         $1378 CAD

Other Fees:       $876 CAD

Explanation of example

By combining the promo code and the voucher together to purchase a single adult round trip premium economy ticket we saved a whopping total of $386 CAD ($113 CAD net savings from promo + $273 CAD net savings from voucher)! The fantastic part about applying this strategy means you do do not compromise your route, fare, dates, or class of service. The cherry on top is that you can use this strategy across fares, destinations, and airlines.

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