Is the Costco Credit Card Worth It? Read This First
Good earning, trapped rewards
The Costco Anywhere Visa from Citi has no annual fee and earns 4 percent on gas up to a yearly cap, 3 percent on restaurants and travel, 2 percent at Costco, and 1 percent elsewhere, which are genuinely competitive rates. The catch is redemption: your rewards accrue all year and arrive as one Costco Cash Reward certificate in February, redeemable only at Costco for merchandise or cash at the register. You cannot use them month to month, cannot spend them anywhere but Costco, and forfeit them if you drop your Costco membership or close the card. See best warehouse-club cards.
The membership and lock-in problem
The card is useless without a paid Costco membership, so the rewards are gated behind an annual fee you pay to Costco. Combined with the once-a-year payout and Costco-only redemption, your cash back is locked inside one retailer ecosystem and tied up for up to a year. A flat 2 percent cash card pays you every month in cash you can spend anywhere, including at Costco, with no membership required to keep the rewards. See are store cards worth it.
Who it actually suits
The Costco card makes sense only if you are a committed Costco member who buys a lot of gas and dining, will hold the membership indefinitely, and does not mind a single annual Costco-only payout. For everyone else, a flexible cash or transferable-points card earns comparably and pays in money you control. See cash back vs travel rewards and co-brand vs flexible cards.
Frequently asked questions
Related reading
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