Is the American Express Platinum Card Really Worth It?

There are two types of cardholders in the world: Those who see The Platinum Card® from American Express and think, "Wow, that's a lot of perks!" -- and those who see the card and think, "Wow, that's a huge annual fee!"

Alright, there's an argument to be made that even the first type of cardholder is going to comment on the $695 fee, too. Because, let's be honest, it's a really big bundle of money you need to pay each year to use this card.

Apply now for The Platinum Card® from American Express.

For some folks, that fee is always going to be too much, either in practice or just principle. But for everyone else, there's a strong case to be made that the fee is well worth paying, especially in the first year.

First year: Worth it with the welcome offer

As with most travel rewards cards, the first year you own The Platinum Card® from American Express will be the most valuable thanks to the welcome offer. In fact, if you use the Membership Rewards points you earn for travel, the welcome offer alone should cover the annual fee for the first year plus give you a few hundred dollars in extra value.

Let's look at the math. The current welcome offer lets you earn 80,000 when you spend $8,000 on the card within the first 6 months. (Keep in mind that welcome offers vary. Terms apply.)

How much those points are worth depends on how you redeem them. You'll get the best value from travel, either through the Amex Travel portal or by transferring them to a partner program. Since welcome offers vary over time, here's how much you'd get from a hypothetical 100,000-point welcome offer:

As you can see, if you can get a redemption worth $0.007 or higher, you're going to at least break even on the card. But it's really not that hard to get at least $0.01 per point -- if not twice that -- making a 100,000-point welcome offer worth $1,000 in free travel.

Perhaps more interesting, this isn't even the highest welcome offer I've seen. You can occasionally find welcome offers worth up to 150,000 Membership Rewards points. That could be $3,000 or more in travel by the time you use it all.

Apply now for The Platinum Card® from American Express.

It's worth noting that Amex limits you to one welcome offer per card per lifetime, meaning you'll only be eligible to earn a welcome offer for The Platinum Card® from American Express once. If you have the time to hunt down a referral offer -- or the patience to wait for a larger public welcome offer -- it could be worthwhile.

Second year and on: Worth it with the credits

I'll be blunt: Unless you fly very often, this card is never going to be worth it on points alone. You'd need to spend $13,900 a year on flights, at 5X points per dollar, to break even on the annual fee (assuming $0.01 per point).

So, whether the second year (and so on) is worth it for you will depend mostly on the credits. Luckily, there are a lot of them. Here are some of the most popular ones:

• $240 annual digital entertainment credit
• $200 in Uber Cash annually
• $200 annual airline fee credit
• $200 annual hotel credit (good for Fine Hotels & Resorts or The Hotel Collection bookings; Hotel Collection requires a two-night stay.)
• $100 annual Saks Fifth Avenue credit
• Terms apply; enrollment may be required

If you can -- organically -- put four of these credits to good use, then you'll have gotten at least your annual fee's worth. Everything else past that point is gravy. This includes all the purchase rewards, lounge access, and other cardholder perks.

Credit cards should augment your existing lifestyle

The most important thing to keep in mind about the ongoing value of The Platinum Card® from American Express is that it's about your current spending.

If you already spend on Uber and the eligible streaming services, then the credits are truly valuable. On the other hand, if you wouldn't spend money on these things without the credits, then you probably shouldn't count them for face value.

For example, if you already pay $20 a month for the Disney bundle, then that credit is truly worth $240 a year. Paying your annual fee is then essentially like prepaying your streaming service. If the only reason you have the service is because of the Amex credits, however, you aren't really getting $240 a year in value added to your life.

Apply now for The Platinum Card® from American Express.

To sum it all up: The Platinum Card® from American Express is worth it for at least the first year if you can earn the welcome offer. After that, it's only really worth the fee if you can get full value from the credits -- or if you really, really like airport lounge access.