Choosing the right credit card for your Costco shopping can significantly impact your savings and rewards. With various options available, understanding the benefits and drawbacks of each card is crucial to maximizing your returns. This guide explores the best credit card options for Costco members in 2024, helping you make an informed decision.
Best Credit Cards for Costco: A Comparison
| Credit Card | Key Benefits | Drawbacks |
|---|---|---|
| Costco Anywhere Visa® Card by Citi | 4% cash back on eligible gas worldwide (on the first $7,000 per year, then 1%), 3% cash back on restaurants and eligible travel worldwide, 2% cash back on all other purchases from Costco and Costco.com, 1% cash back on all other purchases, No annual fee (with paid Costco membership), Accepted worldwide | Requires a Costco membership, Cash back is only distributed once per year as a reward certificate, Lower rewards on non-Costco purchases compared to some other cards, Limited redemption options |
| Chase Sapphire Preferred® Card | 5x points on travel purchased through Chase Ultimate Rewards, 3x points on dining and online grocery purchases (excluding Target, Walmart and wholesale clubs), 2x points on all other travel purchases, 1x point on all other purchases, Points are worth 25% more when redeemed for travel through Chase Ultimate Rewards, Valuable travel and purchase protections, Sign-up bonus potential | Annual fee of $95, Lower rewards rate on Costco purchases directly, Requires good to excellent credit, Foreign transaction fees |
| Chase Freedom Unlimited® | 5% cash back on travel purchased through Chase Ultimate Rewards, 3% cash back on dining and drugstores, 1.5% cash back on all other purchases, including Costco, Intro APR offer, No annual fee, Can combine rewards with other Chase cards for increased value | Lower rewards rate on gas and restaurants compared to some other cards, Requires good to excellent credit |
| Capital One Venture X Rewards Credit Card | 10x miles on hotels and rental cars booked through Capital One Travel, 5x miles on flights booked through Capital One Travel, 2x miles on all other purchases, including Costco, $300 annual travel credit, Access to Capital One Lounges and Priority Pass lounges, Global Entry or TSA PreCheck credit, Valuable travel benefits | High annual fee of $395, Requires excellent credit, Redemption options may be complex for some users |
| Blue Cash Preferred® Card from American Express | 6% cash back at U.S. supermarkets (on up to $6,000 per year in purchases, then 1%), 6% cash back on select U.S. streaming subscriptions, 3% cash back at U.S. gas stations and at transit, 1% cash back on all other purchases, Costco purchases must be made online to earn rewards, Intro APR offer | Annual fee of $95 (see rates and fees), Limited acceptance at Costco warehouses (primarily online), U.S.-focused rewards categories, Requires good to excellent credit |
| Citi Double Cash® Card | 2% cash back on all purchases (1% when you buy, plus 1% as you pay), No annual fee, Simple rewards structure | Lower rewards rate compared to cards with bonus categories, Requires good to excellent credit, Foreign transaction fees |
Detailed Explanations
Costco Anywhere Visa® Card by Citi: This card is specifically designed for Costco members. It offers 4% cash back on eligible gas worldwide (on the first $7,000 per year, then 1%), making it a great option for frequent drivers. You also get 3% cash back on restaurants and eligible travel worldwide, 2% cash back on all other purchases from Costco and Costco.com, and 1% cash back on all other purchases. A key benefit is that it has no annual fee (with a paid Costco membership). However, the cash back is only distributed once per year as a reward certificate, and the rewards on non-Costco purchases are lower compared to some other cards. It is accepted worldwide, which is a plus for international travelers.
Chase Sapphire Preferred® Card: While not specifically a Costco card, the Chase Sapphire Preferred® Card offers valuable travel rewards. You earn 5x points on travel purchased through Chase Ultimate Rewards, 3x points on dining and online grocery purchases (excluding Target, Walmart and wholesale clubs), 2x points on all other travel purchases, and 1x point on all other purchases. The points are worth 25% more when redeemed for travel through Chase Ultimate Rewards. This card comes with an annual fee of $95 and requires good to excellent credit. While the rewards rate on Costco purchases directly is lower, the sign-up bonus and valuable travel benefits can make it a worthwhile option if you travel frequently.
Chase Freedom Unlimited®: The Chase Freedom Unlimited® card offers a straightforward rewards structure with no annual fee. You get 5% cash back on travel purchased through Chase Ultimate Rewards, 3% cash back on dining and drugstores, and 1.5% cash back on all other purchases, including Costco. This card is a good option for those who want a simple rewards program and don't want to pay an annual fee. Additionally, rewards can be combined with other Chase cards for increased value. It requires good to excellent credit for approval.
Capital One Venture X Rewards Credit Card: For those focused on travel rewards and willing to pay a higher annual fee, the Capital One Venture X Rewards Credit Card is a strong contender. It earns 10x miles on hotels and rental cars booked through Capital One Travel, 5x miles on flights booked through Capital One Travel, and 2x miles on all other purchases, including Costco. The card also offers a $300 annual travel credit, access to Capital One Lounges and Priority Pass lounges, and a Global Entry or TSA PreCheck credit. However, the annual fee is substantial at $395, and redemption options may be complex for some users. It requires excellent credit.
Blue Cash Preferred® Card from American Express: The Blue Cash Preferred® Card offers high cash back rates on specific categories. You earn 6% cash back at U.S. supermarkets (on up to $6,000 per year in purchases, then 1%), 6% cash back on select U.S. streaming subscriptions, 3% cash back at U.S. gas stations and at transit, and 1% cash back on all other purchases. A significant drawback is that Costco purchases must be made online to earn rewards, as American Express is not widely accepted in Costco warehouses. The card has an annual fee of $95 (see rates and fees) and requires good to excellent credit.
Citi Double Cash® Card: The Citi Double Cash® Card offers a simple and straightforward rewards program. You earn 2% cash back on all purchases (1% when you buy, plus 1% as you pay). There's no annual fee, making it an attractive option for those who prefer a simple rewards structure. However, the rewards rate is lower compared to cards with bonus categories, and it requires good to excellent credit.
Frequently Asked Questions
Which credit card is best for Costco purchases? The Costco Anywhere Visa® Card by Citi is generally considered the best for Costco due to its 2% cash back on Costco purchases and other benefits.
Can I use any credit card at Costco? No, Costco primarily accepts Visa cards in-store. However, you can use Mastercard and American Express online at Costco.com.
Does the Costco Anywhere Visa® Card have an annual fee? No, the Costco Anywhere Visa® Card has no annual fee as long as you have a paid Costco membership.
What is the cash back redemption process for the Costco Anywhere Visa® Card? Cash back is issued once per year as a reward certificate that can be redeemed for cash or merchandise at Costco.
Can I use the Chase Sapphire Preferred® Card at Costco? Yes, you can use the Chase Sapphire Preferred® Card at Costco, but the rewards rate will be the standard 1x point on all other purchases.
Is the Capital One Venture X Card worth it for Costco shoppers? If you spend a lot on travel, the Capital One Venture X Card can be worth it due to its travel benefits and 2x miles on all purchases, including Costco.
How does the Blue Cash Preferred® Card work with Costco? The Blue Cash Preferred® Card only offers rewards on Costco purchases made online, as American Express is not widely accepted in-store.
What credit score do I need to get the Costco Anywhere Visa® Card? You typically need a good to excellent credit score (670 or higher) to be approved for the Costco Anywhere Visa® Card.
What is the best no-annual-fee credit card for Costco? The Chase Freedom Unlimited® and Citi Double Cash® are good no-annual-fee options, offering 1.5% and 2% cash back on all purchases, respectively.
Are there foreign transaction fees on the Costco Anywhere Visa® Card? No, the Costco Anywhere Visa® Card does not have foreign transaction fees, making it a good option for international travel.
Conclusion
Choosing the right credit card for Costco depends on your spending habits and priorities. The Costco Anywhere Visa® Card by Citi is a solid choice for dedicated Costco shoppers, while cards like the Chase Sapphire Preferred® and Capital One Venture X offer more valuable rewards for frequent travelers. Consider your needs and spending patterns to select the card that provides the most significant benefits for you.