What are Costco’s Visa card terms?

Visa card

Citi’s Costco Anywhere Visa Card offers plenty of cash for gas, travel and purchases at Costco. Let’s see below which is the best credit card for purchases at Costco.

Bulk shopping can be a great option for families who want to save hundreds of dollars on groceries and other essentials throughout the year. With its affordable options for membership, Costco is a favorite of warehouse club fans.

What is the best credit card for purchases at Costco?

In addition to the savings you get from buying supplies in bulk, there’s another way to maximize the benefit of your next trip to Costco: using the right credit card 

Costco card itself offers a co-branded that includes competitive rewards on your purchases, and many other cards also offer first-class rates on Costco spending. However, by swiping the correct card through the register, you can ensure you maximize your points or cash back.

If you like shopping at Costco, keep reading to learn which is the best credit card for Costco purchases and how much value they can provide you.

Costco Anywhere Visa: A Great Card…With a Big Drawback

The Costco Anywhere Visa Card from Citi isn’t just a great card for Costco purchases. With it you can make any purchase and at the same time get a high rate of rewards. In addition, you do not have any foreign transaction fees.

Card offers 4% cash back on up to $7,000 in gas purchases per year (1% after $7,000) – at any eligible gas station, not just Costco, 3% back at eligible restaurants and travel purchases , 2% back on Costco purchases and 1% back on other purchases.

The Costco Anywhere Visa excels as a card for Costco and gas purchases, though you’ll have to deal with an annual Costco membership fee and only redeem your money once a year.

Discounts on gasoline and purchases at restaurants are the ones that provide the most benefits, pushing the profit rate to almost 2% of your spending . If you consume a lot in a particular category (for example, restaurants), you could increase your cash earnings by more than 2%.

There is one big downside to the Citi Costco Visa: You get your money back once a year. Cash back rewards are mailed out as of February in the form of a certificate that you take to your local Costco to redeem for purchases or cash back at the register. If your Costco membership expires before the certificate is sent, you lose all earnings for that year.

Avid Costco shoppers may see this as a moot point. But, if you’re on the fence about your Costco membership, or if you’d rather get your hands on your cash back sooner, you might want to consider a rewards card that’s less restrictive upon redemption.

The Costco card is second to none for Costco gas purchases

If you’re trying to decide which rewards card to use at the gas pump, the Costco Visa is usually the best option . Getting 4% cash back on Costco’s already well-priced gas is a great option. Although other cards offer 5% cash back on gas purchases, their reward terms generally exclude Costco and other stores.

One exception is the Chase Freedom, which offers 5% cash back on quarterly rotating categories. Although spending categories may vary by year, the first quarter category is typically gasoline purchases, and includes Costco gasoline. So for one quarter of the year, the Chase Freedom card is the best option for buying gas . Not only do you receive a higher rewards rate, but you can transfer your rewards to other Chase Ultimate Rewards cards for even better value on travel redemptions.

For the highest earning rate the first year: Chase Freedom Unlimited

The Chase Freedom Unlimited card may not seem like the best bet for Costco purchases. After all, their 1.5% return rate is less than the 2% rate you can get with the Costco card. But, the Chase Freedom Unlimited may offer a better reward value.

You can transfer your points to other Ultimate Rewards cards for a 25-50% increase in your point value, for an average value of 1.88-2.3 cents per point.

Here’s why: The rewards points you earn on the Chase Freedom Unlimited card can be transferred to other Chase cards , including the Chase Sapphire Preferred Card, where you can redeem them for travel rewards or transfer them to one of Chase’s partner airlines for get even more value for your points.

In the tables below you can see the value of the different redemption options for each card. As you can see in the first table, your Costco card earnings for $2,500 spent at the store is $50, no more and no less.

With the Chase Freedom Unlimited card, the value of your points varies dramatically, depending on how you redeem them. If you opt for cash back (ie, a statement credit), you only get $38 worth of value, which is less attractive compared to the Costco card. However, if you transfer your points to the Chase Sapphire Preferred or Chase Sapphire Reserve card, you can increase the value of your points by redeeming them for travel through the Chase Ultimate Rewards portal, where you earn a 25% (Preferred) to 50% redemption bonus. % (Reserve).

And, if you transfer the points to an airline partner, you can do even better by carefully searching for higher value airfare options. For example, Southwest points are very valuable. Chase Freedom Unlimited rewards earned on your Costco purchases could be worth $59 or more when transferred to the Southwest loyalty program.

Tip: To take advantage of the most valuable redemption options, you must have both the Chase Freedom Unlimited card and the Chase Sapphire Preferred or Sapphire Reserve card. This can be challenging for some cardholders, as Chase enforces a strict 5/24 rule on credit card applications. To qualify for a new Chase card, you cannot have opened five or more cards with any issuer in the last 24 months. Consider if this fits into your credit card strategy before applying for more than one card.

If you prefer a rewards card with the same flat rate on any purchase: The Capital One Venture Rewards Credit Card is your option. This card offers a rewards rate of 2 miles per dollar on all your spending, including Costco purchases. Like the Citi Costco card, Capital One Venture card miles are valued at 1 cent when redeemed for travel, which means $2,500 in spending will net you $50 in travel rewards.

However, unlike the Citi Costco card, the Venture card is extremely flexible in how you redeem your rewards . You can redeem any amount at any time, and you have a variety of redemption options, including cash back, merchandise, and travel.

However, there is a catch: The card includes a $95 annual fee.

Many other cards offer 2% cash back on Costco purchases

In addition to the Capital One Venture card, other cards offer 2% cash back on Costco purchases.

The Visa Signature Fidelity and PenFed Power Cash Rewards Visa Signature cards, for example, offer a flat 2% rewards rate on your purchases. On the negative side, both cards require you to have a qualified bank account. Still, for current cardholders, these cards are the best option for Costco purchases, since you can redeem your rewards anytime.

By aamritri

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