American Express One Credit Card Review

Summary - The One from American Express® is a financial savings credit card that puts 1% of what you spend on your card into a high yield FDIC insured account with American Express Bank. It is also one of the easier card to get for those with fair credit. This card will appeal to those who want to have some sort of "forced savings" they can get from their credit card spending as the "savings" are deposited into the account automatically. But isn't the same as any other cash back credit cards? Read on to see what we think.

Savings Formula - For every dollar you spend, the One from American Express puts 1% into a high yield savings account at American Express Bank. This account is FDIC insured for up to $100,000. You can earn unlimited "savings".

Interest Protection Plan - The One from American Express® offers an "interest protection plan". This is basically what it is. If you carry a balance, you will be charged interest from the day you make any new purchase (ie you have no grace period). It is only when you have no outstanding balance that you get either 20 or 25 days of grace period from the day of purchase. However, the One from American Express allows you to carry a balance and yet get a grace period for new purchases.

Fees - The One from American Express has an annual fee of $35.00, which is waived during the first year. There are no additional cardholders fee. The APR is as low as prime rate plus 5.99%. The average daily balance method (including new purchases) is used to calculate monthly balances.

Other Benefits - With this card, you also get typical Amex shopping features like Buyers Assurance program (extended warranty), online fraud protection plan, return protection plan and purchase protection plan.

In my opinion, the One from American Express is essentially a cash back credit card. Most cash rebate credit cards either pay you an annual rebate check or require you to call the issuer once you have earned a certain amount. Hence in this respect, the One from American Express offers more convenience as your "savings" are automatically debited into a high yield account. But are there other cards that offer such "convenience"? And if they do, are they other cards that pay more than 1% rebates?

Bank of America has a few cash rebate cards that also offer 1% rebates on every thing you spend on the card. Best of all, they allow you options on how to redeem your cash rebates. You can request for a check, use them as statement credits, or have them automatically transferred to your bank account. Plus, there are no annual fees for any of these Bank of America cash back credit cards. Therefore, I think the BOA cash back cards beat the One from American Express.

Fidelity has a few cards issued by American Express. They operate like the "One". For every dollar that you spend on the Fidelity card, you will earn 2% rebates that will be deposited into your Fidelity account (it could be either a retirement account or brokerage account depending on the card). There is also no annual fee. In all aspects, the Fidelity card handily beats the Amex One.

The Amex One also faces stiff competition from other regular no annual fee cash back credit cards that offer 5% rebates on a variety of expenditures. Cards like the Amex's own Blue Cash and Discover More Card all give 5% rebates on various types of expenditure.

Verdict - The problem with the One from Amex is that at the end of the day, it is just an ordinary 1% cash back cards. It offers the convenience of your rebates being deposited in a savings account. But cards like BOA's cash back cards and the Fidelity Amex also offer that feature. But in addition to that, these cards have no annual fee and there are many cards that offer more than 1% rebates. This card just does not stack up the others in the market and we have to recommend you give it a skip.

Update - This card is no longer being offered by Amex. (probably due to lack of success?)