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AmEx Credit Card Rewards Lose Luster

American Express Blue Preferred is getting some restrictions.My favorite credit card is about to become much less rewarding.

I use the American Express Blue Preferred card almost exclusively but particularly enjoy swiping it at the grocery store, where I earn a generous 6% cash back.

There’s just no other reward card quite so good. With a family of four, I’ll easily charge $8,000 or more in groceries this year.

But now AmEx is set to place restrictions on how much I can earn.

Indeed, this too-good-to-be true deal is too good to last.

So, what does this mean to my wallet — and perhaps yours, too?

In 2012, I’ll earn nearly $500 cash back just from grocery purchases, well more than enough to offset the $75 annual fee.

Throw in the nice 3% cash reward on gasoline and department store purchases, and I’ll earn even more. (This card pays 1% back on everything else.)

But on Jan. 15, 2013, American Express will begin rolling out a cap on the grocery reward. Cardholders will earn 6% on just the first $6,000 in spending at grocery stores. Any spending above that amount will earn 1%.

If you own this card, the cap begins next year on the anniversary of when you opened the card.

The cap means the maximum you can earn annually at 6% is $360, or about $140 less than what I’ll wind up getting back in 2012.

To be sure, this isn’t a deal breaker.

Even with the cap, I’ll earn more rewards than most credit cards offer.

And I still have time to earn unlimited 6% cash back. (You bet I’m going to take advantage this Christmas by buying lots of gift cards at the grocery store.)

But I fear this is the beginning of the end for this great card. The rewards will be chipped away over time — like what banks have done to high-yield checking accounts — until there is little left to celebrate.

Compare the American Express Blue Cash Preferred with other rewards credit cards in our database.

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