American Express Cobalt Card review

How the Cobalt earns points

The Cobalt is built around food. Restaurants, food delivery and groceries all earn 5 Membership Rewards points per dollar, eligible streaming services earn 3 points, travel, transit and gas earn 2 points, and everything else earns 1 point. The 5x grocery rate applies to up to $30,000 of spending a year, which is about $2,500 a month, so most households won’t reach the limit.

To see what that means in practice, take a household that spends $800 a month on groceries and eating out. At 5 points per dollar, that’s 4,000 points a month, or 48,000 points a year from those categories alone, before counting streaming, gas or anything else on the card.

The welcome offer

New cardholders can earn up to 15,000 Membership Rewards points in their first year. The offer pays 1,250 points for each monthly billing period in which you spend $750, so collecting all 15,000 points means hitting $750 in each of the first 12 billing periods, or $9,000 over the year.

Because the bonus is paid month by month, a slow month only costs you that month’s 1,250 points. You can still earn the rest.

Getting value from Membership Rewards

Membership Rewards points are among the more flexible points in Canada because they can be transferred to airline and hotel partners, including Aeroplan and Marriott Bonvoy. That flexibility is what makes a high earn rate worth having: you aren’t locked into one airline or one hotel chain.

The card also includes Amex Offers, which are targeted statement credits at participating merchants, and Front Of The Line access to presale and reserved tickets for concerts and events.

Fees, interest and the fine print

Instead of one annual fee, the Cobalt bills $15.99 a month, which adds up to $191.88 a year. Monthly billing makes the cost easier to absorb, but it’s still one of the higher fees for a card aimed at everyday spending, so it pays to check that your food spending covers it.

Purchases made in a foreign currency carry a 2.5% foreign transaction fee, so $1,000 of spending abroad or with a US online store adds about $25. Purchases and cash advances are both charged 21.99% interest. You avoid purchase interest entirely by paying the full statement balance by the due date.

Insurance coverage

For a card in this price range, the Cobalt’s insurance package is solid, led by mobile device coverage for phones bought with the card. Coverage details, limits and exclusions are set out in the insurance certificate, so read it before you rely on any of it.

• Mobile device insurance up to $1,000
• Travel accident insurance
• Car rental theft and damage
• Flight and baggage delay
• Hotel and motel burglary

Who it suits, and who should look elsewhere

The Cobalt is a strong fit if a large share of your monthly budget goes to groceries, restaurants and delivery, and you’re comfortable using a second card where American Express isn’t accepted.

It’s a weaker fit if you travel or shop in US dollars often, because of the 2.5% foreign transaction fee, or if most of your spending falls outside food and you’d rarely earn more than 1 point per dollar.

How it compares

The Scotiabank Gold American Express Card is the Cobalt’s closest rival. It has a lower $120 annual fee, no foreign transaction fee and up to 6 Scene+ points per dollar at Sobeys, Safeway, FreshCo, Foodland and other partner grocers. The Cobalt’s advantage is the flexibility of Membership Rewards points.

If you’d rather pay no fee at all, the Wealthsimple Credit Card earns a flat 1% cash back on everything with no annual fee and no foreign transaction fee. You earn far less on food, but it costs nothing to keep.

Before you apply

The recommended credit score is 720 or higher, and American Express makes the final decision using your full credit profile. Rates, fees and the welcome offer can change, so confirm the current terms on the American Express website before you apply.