Amex Cobalt Card: Changes to the 5x Eats & Drinks Earning Limit

American Express has restructured the Cobalt Card‘s much-beloved 5x points earning rate on eats & drinks. As of today, August 15, 2023, there’s a monthly cap of $2,500 (CAD) in place of the previous $30,000 (CAD) annual limit.

Don’t panic, though: by doing the math, you’ll notice that the annual limit has simply been broken down into monthly limits, and you’ll still be able to earn up to 150,000 Membership Rewards points on eats & drinks every year.

Amex Cobalt Card: Earning 5x MR Points on Eats & Drinks

As a refresher, the American Express Cobalt Card offers an industry-leading benefit: 5x Membership Rewards points on eats & drinks purchases. 

American Express defines “eats & drinks” as:

• Restaurant, quick service restaurant, coffee shop and drinking establishments in Canada
• Stand-alone grocery stores in Canada
• Delivery of food and groceries in Canada as a primary business

Until now, the 5x earning rate has been limited to $30,000 (CAD) in spending on eligible eats & drinks categories per year, based on the cardholder anniversary date. Once this limit has been reached, further purchases in the eats & drinks category only earned 1x points per dollar spent.

As of August 15, 2023, this annual limit has changed to a monthly limit of $2,500 (CAD), which resets at the beginning of each month.

Any eats & drinks purchases above and beyond $2,500 each month drop to the baseline 1x earning rate.

How Will This Change Affect Cardholders?

A $2,500 (CAD) monthly limit comes out to the same effective total as a $30,000 (CAD) annual limit, except cardholders will need to manage smaller limits on a monthly basis.

Most Amex Cobalt Card holders will likely be unaffected by this change. Despite the card’s strength on eats & drinks earnings, spending $2,500 (CAD) on groceries and restaurants is still a lot when, as per Canada’s Food Price Report, a family of four will spend an average of $1,357 (CAD) monthly on food each year.

Instead, this restructuring of the earning cap is very much designed to curb inorganic spending strategies, such as buying gift cards for other retailers at grocery stores to effectively get 5x the points on other expenses.

By implementing smaller monthly limits, American Express is making it a little bit more cumbersome to incorporate large gift card purchases into your Cobalt Card strategy, alongside organic spending on groceries and restaurants.

Cardholders who previously hit the $30,000 (CAD) annual threshold will now need to plan their spending out more carefully, so that they continue to optimize the 5x earning rate throughout the year without falling afoul of the $2,500 (CAD) monthly limit. 

Again, in a nutshell, if you’re a typical cardholder, this fairly minor change shouldn’t worry you. But if you do splurge on eats, drinks, and purchases at the grocery store and could see yourself exceeding the monthly limit, it may be worth considering getting a second Cobalt Card under your partner’s name to switch over once you’ve hit $2,500 (CAD) for the month. 

Conclusion

American Express has restructured its generous 5x eats & drinks earning benefit on the Cobalt Card as of today, August 15, 2023. The $30,000 (CAD) annual cap has been broken down into a $2,500 (CAD) monthly limit instead. 

You can still earn up to 150,000 Membership Rewards points per year on eats & drinks, though you may need to plan out your spending more carefully across 12 months if you’ve previously had a habit of hitting the $30,000 (CAD) annual limit early in the year.