Should You Sign Up For American Express Costco & jetBlue Credit Cards Before The Relationship Ends?

We’ve talked about the fact that American Express will be ending it’s relationships with Costco (official) & jetBlue (unofficial) before. Yesterday we looked at what will happen to existing American Express Costco & jetBlue cardholders.

Another question people have is “does it make sense to sign up for either of these cards before the relationship ends?”. To answer this question we really need to look at what will happen to existing cardholders, here is our final conclusion on this:

• The American Express JetBlue card will be converted to the new Barclaycard product. This reasoning follows what I outlined above, but we also have an additional piece of data. Barclaycard had a job posting on Linkedin, the job title was “JetBlue Customer Marketing Barclaycard“. One of the things they would be responsible for is “Create activation strategy for new and converted accounts“. This is a pretty clear indication that Barclaycard will have access to existing American Express cardholders.

• TrueEarnings from Costco and American Express cardholders will have their card converted to another American Express card. This is another situation where we have a bit more data to back this prediction up, last year American Express Canada also lost their Costco partnership. Canadian cardholders  will reportedly be changed over to the American Express Simply Cash product. In the States we don’t have this product, but it looks identical to the Blue Cash card. American Express might even give cardholders the choice of choosing between the Blue Cash card and the AmEx Everyday cards (and possibly the preferred version of each).

Now that we have those predictions, we can take a look at whether it makes sense to sign up for either card.

jetBlue

Because the jetBlue card will be converted to a Barclaycard at some stage, we can assume that American Express will not increase the sign up bonus on this card. If there was still going to be a jetBlue American Express card, then I would have expected them to increase the sign up bonus to try and get as many new applicants as possible (ala Barclaycard with the US Airways card)

The American Express jetBlue card is currently offering a sign up bonus of 20,000 jetBlue True Blue points after $1,000 in purchases. Interestingly some people are seeing this bonus as already being decreased to 10,000 jetBlue TrueBlue points. If you use this link you should see the 20,000 point offer.

The rest of the benefits on this card are lackluster to say the least.

• Earns 2x points on jetBlue purchases and 1x points on all other purchases
• Statement credit for 50% off select inflight purchases such as movies, food and cocktails
• $50 statement credit each year you purchase a JetBlue Getaways vacation package with your Card.
• Annual fee of $40 is waived the first year

The only real thing worth considering is the sign up bonus of 20,000 points. But how much are 20,000 points actually worth? Seth from Wandering Aramean is one of my favorite bloggers, I love his analytic approach to questions such as these. I’d strongly recommend reading this post by him which answers the question of how much TrueBlue points are worth. Here are some quotes directly from that article (which again, I implore you to read):

• The range today is rather wider, from 0.97-1.89 CPP, but the average of 1.41 CPP
• [When talking about Mint premium fares] This equates to a valuation of 1.7 cents per point
• The average value per point on an international redemption in the data I queried was 1.569 cents
• For domestic trips (excluding Mint) the value was about 14% lower at 1.38 cents per point

Basically the short and skinny of it is that you’ll get better value when redeeming for international trips & Mint premium fares than you would from domestic fares. Let’s say you get the average domestic value of 1.38¢ per point, this would make the sign up bonus worth $276. Which is by no means amazing, but it’s fairly competitive when comparing it to cash sign up bonuses.

I personally don’t think American Express will increase the sign up bonus on this card, in fact I think the chances are they will lower it to 10,000 points. If you want 20,000 TrueBlue points from American Express, I’d grab this card but for the majority of people you’ll be able to get much better value elsewhere.

You’ll also likely want to cancel the card before it converts to a Barclaycard, so that you can get the sign up bonus on that card as well. I expect that card to launch with a sign up bonus of 30,000-40,000 points, but that is almost a complete guess so don’t put much faith in it.

Costco

TrueEarnings Card from Costco and American Express is a bit different in that it doesn’t offer a sign up bonus and I suspect American Express to convert cardholders to another American Express product (most likely the Blue Cash card).

Because of this it doesn’t really make sense to sign up for this card before the relationship ends (you could sign up for that card directly and get a sign up bonus of $100). The only way it would make sense is if you wanted multiple blue cash cards, and even then it wouldn’t really be useful unless they were blue cash preferred. The other option is that they could convert you to the new AmEx EveryDay cards, I think this is less likely as they offer membership rewards points instead of cash back.

Final Thoughts

Personally I’m staying clear of both cards for now. It’s also important to remember that a lot of this is speculation and guess work, I could be completely wrong about a lot of different things. American Express could offer a higher sign up bonus on the jetBlue card, conversions might or might not happen.

What will you do in relation to these two new cards? Who should American Express replace them with? I hope they extend their AirBnB partnership and offer an AirBnB credit card.