Costco Anywhere Visa® Credit Card by Citi Review
Buying in bulk is a great way to save money and Costco is one of the leading warehouse shopping clubs. A Costco credit card can put even more cash back in your pocket every time you shop.
If you’re a loyal Costco customer, you should know that on June 20, 2016, the retailer will switch from American Express to Visa as its preferred credit card payment network. That means if you have an American Express TrueEarnings Costco credit card some changes are in store for your wallet.
Starting in May, Citi will roll out the Costco Anywhere Visa® Card as a replacement. If you have a Costco credit card or you’re planning to apply for one, here’s everything you need to know about the switch.
Costco Anywhere Visa® Card by Citi main features
The Costco Anywhere Visa® Card by Citi is different from the TrueEarnings card in a few ways. Existing card members may be pleasantly surprised at the benefits their new card comes with.
Here’s an overview of what you’ll get with this card:
- Cash back – The Costco Anywhere Visa® Card by Citi pays up to 4% cash back on purchases. The rewards structure is the best reason to get this card and we’ll cover it in more detail later on.
- No annual fee – Earning cash back is great but not when a big chunk of it gets eaten up by a high annual fee. Fortunately, the Costco Anywhere Visa® Card by Citi has no annual fee at all.
- Travel benefits – This card comes with worldwide travel accident and car rental insurance. That can come in handy if you’re on a trip and something goes wrong.
- Shopping protections - Citi also offers damage and theft purchase protection for the things you buy. Extended warranty protection is available for certain purchases.
- Citi Private Pass – Private Pass is Citi’s VIP events program. Costco Anywhere Visa® Card members are automatically enrolled. You’ll get exclusive access to concerts, sporting events and more just for being a card member.
- Additional savings for business members – If you have a small business account, you can join the Visa SavingsEdge program for free. You can get automatic savings when you use your Costco Anywhere Visa® Card at selected merchants.
- EMV security – All Costco Anywhere Visa® cards come with EMV chip technology. If you’re using your card at a store that has chip readers at the register, you’ve got an extra layer of fraud protection.
Card rates and fees
We already mentioned that the card has no annual fee. According to Citi, TrueEarnings members will receive an information package that details the full fee schedule. It’ll also have the annual percentage rates for purchases, balance transfers and cash advances.
You also have to pay your annual Costco membership fee. A Gold Star or Business membership will cost you $55 a year. An Executive Membership runs $110 annually but you get some extra perks.
Main highlight: More cash back rewards
The biggest change from the American Express TrueEarnings Costco Card is the rewards structure. You still earn cash back but now you get more of it. That’s a major plus in our book.
With the Costco Anywhere Visa® Card by Citi, the cash back rewards add up like this:
- 4% cash back at eligible gas stations, including Costco, on the first $7,000 in purchases annually
- 3% cash back on eligible restaurant and travel purchases
- 2% cash back on all other purchases from Costco and Costco.com
- 1% cash back on all other Visa purchases
That’s a step up if you have the TrueEarnings card. With that card, members earn 3% back on the first $4,000 in gas purchases, 2% back on travel, restaurants and Costco purchases and 1% back on everything else.
Compared to what some gas rewards credit cards offer, the cash back for gas purchases alone is a great reason to consider this card. If you do a lot of spending at gas stations, the Costco Anywhere Visa® can save you money when you fill up.
The 3% cash back you can earn at restaurants and on travel is also better than what many top rewards cards offer. The Chase Sapphire Preferred® Card, for example, only pays double points on restaurant and travel purchases.
Here’s an example of how much cash back you can earn with the Costco Anywhere Visa® each year:
Example of how much cash back you can earn with the Costco Anywhere Visa
|On restaurants and travel||$6,000||$180|
|On other Visa purchases||$2000||$20|
|Total spending & cash back earned||$21,000||$600|
One potential downside is the way cash back rewards can be redeemed. With a typical cash back credit card, you can redeem your rewards once you reach a certain dollar amount. The Costco Anywhere Visa® does things differently.
Instead of redeeming rewards as you go, you receive a rewards coupon once a year with your February billing statement. The TrueEarnings Costco card did the same.
That means you have to wait to get the cash back you’ve earned over the previous 12 months. Rewards coupons expire on December 31st of the year they’re issued so if you slip up and forget to use it, you’re out of luck.
Any unused cash back earned with your TrueEarnings American Express card will transfer over to your Costco Anywhere Visa. That doesn’t include any Membership Rewards points you earned with the card.
Tip: Register your new card with Citi online so you can track your spending and see the rewards you’re earning.
Final verdict: Is the Costco Anywhere Visa® Card by Citi right for you?
If you already have a TrueEarnings card from American Express, the switch is a good thing. Being able to earn more cash back with no annual fee other than your Costo membership is a great incentive to keep your account open.
On the other hand, you may be better off with another cash back card if you have a problem waiting for your rewards. The fact that the interest rates and fees are still a big question mark may also make some would-be card members nervous.