New: Cobalt American Express

For the longest time, I've been using the Scotia Bank American Express Gold. Briefly, it has a 99$ annual fee, comes with premium insurance for tickets purchased with the card, and gives you a 4% return on gas, grocery, dining, and entertainment expenses. You have to redeem your 4% rewards in the way of travel in order to get the highest rate of return. Gas, grocery, dining, and entertainment cover a lot of purchases.

The downside to this card is that a) it is an AMEX (which is not as well accepted as other places), and b) non bonused spend receives a 1% return. If you buy your travel on this card, you will get great travel insurance, but you will get a poor rate of return.

Introducing the American Express Cobalt Card

 
I was recently looking at the American Express Cobalt Card. It's a new card that was recently introduced. You earn Membership Rewards points for the following:

• 5 points per dollar spent on dining and grocery store purchases
• 2 points per dollar on gas station, travel purchases, and commuter / transit purchases (no other credit card offers 2% return on travel with all the insurance premiums).
• 1 point per dollar on everything else

Again, not everyone accepts AMEX, which continues to be a major limitation. Its annual fee is slightly higher than the gold card at 120$ a month, payable in 10% installments.

What does one do with Membership Rewards (MR) points?

• Convert them at a 1:1 ratio with Air Canada's Aeroplan or Hilton HHonor's programs
• Convert them at a 1 : 0.75 ratio with Delta, British Airways, Etihad, Cathay Pacific, and Alitalia's frequent flyer points
• Convert them at a 1 : 0.5 ratio for Starwood Preferred Guest  
• Convert them to gift cards at a 0.83% return (3000 MR points for a 25$ gift card -- a poor value)
• Buy toasters at an even worse value

I have recently fallen out of favour of hoarding airline miles because of the difficulty in finding availability for fixed date travel (my work is not very flexible in what days I can leave). So one of the more interesting finds was their own reward chart.

• 15,000 points (max ticket value = 300$) for a select list of popular routes
• 20,000 points (max ticket value = 300$) for a travel to same or adjacent provinces/states
• 40,000 points (max ticket value = 700$) for North American travel
• 60,000 points (max ticket value = 900$) for European travel
• 100,000 points (max ticket value = 1,700$) for Asia/Pacific/Australia travel
• Or 1% back rebated to any other charged travel

If prices are above the max ticket value before tax, then you pay that in addition to the taxes.

This is potentially quite lucrative because it can be up to a 2c/point return on the popular YVR-YYC route (tickets are almost always above 300$ before taxes during times like Christmas). And if you earned 5 points per dollar spent at a restaurant, then that's potentially a 10% return.

The points earned on these airplane tickets themselves earn points, and they are not subjected to capacity controls.

I'm thinking about making the switch ...