As a member, I’m sure you’ve been asked at one time or another to fill out a Costco credit card application… but should you do it or not?
When I first joined Costco, I held off on their TrueEarnings card. Why? Because store-affiliated cards are usually a bad deal. But once I researched it, I realized this is arguably the best credit card on the market. Here’s why the AmEx Costco card will save you money:
- 3 percent cash back at U.S. gas stations and on gasoline at Costco up to $4,000 per year in purchases, then 1 percent – Let’s face it, the last time gas was truly cheap was… well, I can barely remember that far back! So anything to save on gas helps, right? With this card you get a full 3 percent rebate on the first $4,000 spent annually on fuel purchases for your car (and 1 percent after that). That’s like getting a 12 cent discount per gallon when gas is $4.
- 2 percent cash back at U.S. restaurants – There are very few credit cards on the market that give higher rewards for dining out and the ones that do usually only give it for a few months out of the year. This is the only card gives you an unlimited 2 percent at restaurants all year long.
- 2 percent cash back on eligible travel purchases, including at Costco – You get an unlimited 2 percent cash back on your eligible travel purchases, such as airfare, hotels, cruises, car rentals, travel booking services, tour operators, etc. This is really incredible when you consider that most airline credit cards (with a hefty annual fee) typically only give around 2 percent rewards and that’s only on their associated airline. With this credit card from Costco you are getting 2 percent regardless of the company you’re buying from.
- 1 percent cash back on other purchases, including at Costco – All other purchases will be earning you 1 percent cash back, including your shopping at Costco. Did you know that some other American Express cards only earn 0.25 percent at Costco and warehouse stores? So sure, you could be using another AmEx for your purchases there but only this one gives you up to 4x the earning power.
With that type of earning power, even the average person might earn hundreds of dollars per year. In fact, I know a married couple in Michigan that are by no means big spenders (an elementary school teacher & nurse) and last Christmas they were telling me how with their regular middle-class spending, the Costco credit card rewards program earned them nearly a $500 rebate for the year!
Other unique benefits…
As if the rewards program wasn’t reason enough to apply, the American Express Costco card also gives you some extremely valuable benefits – at no additional cost – on qualified purchases. Consult issuer for terms and restrictions.
- Extended Warranty – AmEx will automatically double the original manufacturer’s warranty coverage, for up to one full additional year, on eligible purchases that come with a manufacturer’s U.S. warranty of five years or less.
- Purchase Protection – Ever accidentally damaged something within 90 days of buying it – or worse yet – had it stolen? If either of those things happen on an eligible purchase, you can be reimbursed for up to $300 per eligible item, excluding shipping and handling, up to $1,000 annually per credit card account.
- Ticket Savings Center – Through an exclusive partnership between AmEx and TicketMaster, you get access to concert and event presales, preferred seating, and discounted tickets for select shows.
- 2 memberships in 1 card – The Costco credit card will serve as both your Costco Membership card as well as your American Express card, so there will be no need to carry around both!
And not only will you be getting great rewards on travel, but also these travel-related benefits…
- $100,000 travel accident insurance – This benefit offers up to $100,000 in coverage in the event dismemberment or accidental death during eligible travel. Consult the full cardmember documentation for details, exclusions, etc.
- No-Fee Traveler Cheques – This saves you money a couple different ways. First of all, as a credit cardholder, you can simply call up AmEx and get access to these without paying the fees everyone else is charged. Secondly, by converting your currency before your trip to the local currency, you avoid paying those costly conversion fees.
- Car Rental Loss and Damage Insurance – This benefit provides coverage for both collision and theft of your eligible rental vehicle.
- Global Assist Hotline – Whenever you are more than 100 miles from home and encounter an emergency, this hotline is here to help and it won’t cost you a dime. For example, let’s say you get injured in a foreign country and need advice finding the right doctor? Or equally terrifying, you wind up in a legal bind in a country where you don’t speak the language? Or your bags, passport and money are stolen? Whatever the problem may be, American Express has setup this special 24 hour helpline to assist cardmembers.
What’s the annual fee?
Surprisingly, the Costco credit card’s annual fee is zero! As long as you are a paid-up Costco member, there is no annual fee for this credit card. As of March 2014, if you want a no annual fee cash back rewards card this is your best choice, period.
If you are not a Costco member and would like to join, when you apply for the credit card offer below you can sign up for a Costco Gold Star membership (which is only $55 per year).
Updated March 4, 2014