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Few retailers inspire such strong customer loyalty as Costco (one couple even got married there). But is it smart for Costco members to sign up for the Costco Anywhere Visa® Card by Citi to maximize their savings? After all, store credit cards are not always the best option for consumers as they sometimes have less than stellar terms and rewards.
Select took a deeper look at the Costco Anywhere Visa Card's benefits and drawbacks to help you decide whether it is right for you. Here are five important things you should know about the card.
The Costco Anywhere Visa® Card by Citi is a valuable card to pair with a Costco membership, but the rewards program is more restrictive than what you get with a typical cash-back card.
- High rewards rates for gas/EV charging and travel
- No foreign transaction fees
- Restrictive rewards that you can only cash out once per year
- Requires a paid Costco membership
- No welcome bonus
Highlights
Highlights shown here are provided by the issuer and have not been reviewed by CNBC Select's editorial staff.
- Discover one of Citi's best cash back rewards cards designed exclusively for Costco members
- Earn 5% cash back rewards on gas at Costco and earn 4% cash back on other eligible gas and electric vehicle (EV) charging purchases for the first $7,000 combined spend per year, and then 1% thereafter.
- 3% cash back on restaurants and eligible travel purchases and eligible travel, including Costco Travel.
- 2% cash back on all other purchases from Costco and Costco.com
- 1% cash back on all other purchases
- No annual fee with your paid Costco membership and enjoy no foreign transaction fees on purchases
- Receive an annual credit card reward certificate, which is redeemable for cash or merchandise at U.S. Costco warehouses, including Puerto Rico
Balance transfer fee
5% of each balance transfer; $5 minimum
Foreign transaction fee
None
1. It has a robust rewards program
While experts usually don't recommend signing up for a store credit card, the Costco Anywhere Visa Card is an exception, thanks in part to its tiered rewards program that benefits gas guzzlers, foodies and frequent travelers.
Here are the rewards you earn with the Costco Anywhere Visa:
- Earn 5% cash back rewards on gas at Costco and earn 4% cash back on other eligible gas and electric vehicle (EV) charging purchases for the first $7,000 combined spend per year, and then 1% thereafter.
- 3% cash back on restaurants and eligible travel purchases and eligible travel, including Costco Travel.
- 2% cash back on all other purchases from Costco and Costco.com
- 1% cash back on all other purchases
Unfortunately, the card doesn't currently offer a welcome bonus, so you can't earn increased rewards during your first few months of account opening.
2. Costco purchases don't earn the highest cash-back rate
Though this card is co-branded with Costco, purchases at the store don't earn the highest amount of cashback. You earn 2% cash back on purchases from Costco and Costco.com.
While this may seem rather low, if you frequently shop at Costco for groceries, it can still help you maximize your savings. Many cards that offer bonus rewards for grocery shopping exclude warehouses like Costco, so while you can earn 6% cash back* at U.S. supermarkets on up to $6,000 per year in eligible purchases (then 1%) with the Blue Cash Preferred® Card from American Express, that doesn't apply to Costco purchases. Terms Apply. Also, keep in mind that Costco warehouses only accept credit cards issued by Visa so you wouldn't be able to swipe an American Express, Mastercard or Discover card anyway.
The Costco Anywhere Visa Card is still a decent option for Costco purchases with 2% cash back. However, there are other cards that offer similar (or better) returns at Costco. For example, the Wells Fargo Active Cash® Card is a no annual fee Visa card that offers 2% cash rewards on eligible purchases, including ones made at the wholesale club.
And if you're a Bank of America Preferred Rewards member, you can earn up to 2.62% cash back on all purchases made with the Bank of America® Unlimited Cash Rewards Card. You can become a Preferred Rewards program member by having at least $20,000 in a Bank of America deposit and/or Merrill investment account, though you'll need to have at least $100,000 invested to unlock the maximum 2.62% return.
The Wells Fargo Active Cash® Card is great if you want simplicity thanks to its flat-rate 2% unlimited cash rewards on purchases and $0 annual fee.
- High flat-rate return on purchases
- Intro-APR for purchases and qualifying balance transfers for a year
- No annual fee
- Cell phone protection
- Has a foreign transaction fee
- Limited redemption options unless you pair it with a Wells Fargo card that allows point transfers
Highlights
Highlights shown here are provided by the issuer and have not been reviewed by CNBC Select's editorial staff.
- Apply Now to take advantage of this offer and learn more about product features, terms and conditions.
- Earn a $200 cash rewards bonus after spending $500 in purchases in the first 3 months.
- Earn unlimited 2% cash rewards on purchases.
- 0% intro APR for 12 months from account opening on purchases and qualifying balance transfers. 18.49%, 24.49%, or 28.49% variable APR thereafter; balance transfers made within 120 days qualify for the intro rate and fee of 3% then a BT fee of up to 5%, min: $5.
- $0 annual fee.
- No categories to track or remember and cash rewards don't expire as long as your account remains open.
- Find tickets to top sports and entertainment events, book travel, make dinner reservations and more with your complimentary 24/7 Visa Signature® Concierge.
- Up to $600 of cell phone protection against damage or theft. Subject to a $25 deductible.
Balance Transfer Fee
3% intro for 120 days from account opening, then up to 5%, min: $5
Foreign Transaction Fee
3%
3. You can only collect rewards once a year
The cashback you earn with the Costco Anywhere Visa Card is provided via an annual reward certificate once your February billing statement closes. To redeem the certificate for a check or merchandise, you have to head to a U.S. Costco warehouse. That may come as an unexpected surprise if you didn't read the fine print as most other credit cards allow you to redeem rewards online, typically within one billing cycle of earning them.
Learn more about how to redeem Costco credit card rewards.
4. You have to be a Costco member
While the card itself has no annual fee, cardholders must have a paid Costco membership, which starts at $60 for Gold Star and Business levels, then doubles in price to $120 for Gold Star Executive and Business Executive members.
If you're already a Costco member, this isn't really an added cost. But if you're considering this card and already have a membership with BJ's or Sam's Club, you may think twice about adding the cost of another warehouse club membership.
Learn more: What credit cards does Costco accept?
5. The card offers helpful perks for travelers
Aside from the solid 3% return on travel purchases, frequent travelers will benefit from the various perks provided by the Costco Anywhere Visa Card, which include travel and emergency assistance, worldwide travel accident insurance and worldwide car rental insurance.
Additionally, there are no foreign transaction fees, so purchases made outside the U.S. won't incur the typical 3% charge. This can add up to substantial savings if you regularly travel abroad.
For more details on the card's benefits and perks, see our full review of the Costco Anywhere Visa Card.
Bottom line
The Costco Anywhere Visa Card is right for you if you're a Costco member who wants to earn competitive rewards on gas, EV charging purchases, dining and travel purchases, and don't mind receiving rewards once a year.
However, if you're not loyal to Costco and want a card that doesn't require a membership but still earns high rewards, check out our list of the best credit cards for Costco. You can also browse Select's roundups of the best cards for travel, dining, grocery and gas purchases.
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*Cash Back is received in the form of Reward Dollars that can be redeemed as a statement credit or at Amazon.com checkout.
For rates and fees of the Blue Cash Preferred® Card from American Express, please click here.
