Citi® Costco Anywhere Visa® Credit Card Review

Costco Anywhere Visa® Card Review

We’ll talk about the Costco Anywhere Visa® Card, which is the card for Costco regulars.

The Costco Anywhere Visa® Card is designed by Citi® for Costco members. It offers generous rewards in several everyday spending categories. These include 4% on gas stations everywhere, up to an annual spending limit, 3% on restaurants and travel, 2% on Costco purchases, in physical stores and online, and 1% on all other purchases. To get your hands on these attractive rewards you’ll need a Costco membership. So, although the card has no annual fee, it’s not free since the Costco annual membership fee costs $60 or $120.

Costco Anywhere Visa®: pros and cons

Rewards system in a nutshell

The rewards system of the Costco Anywhere Visa® Card has the following rates:

• 4% rewards rate for eligible gas purchases worldwide, which include those at Costco, for the first $7,000 spend on gas annually. After reaching the threshold amount, a 1% rewards rate is applied to gas purchases. A 1% rate is also applied to gas purchases made at supermarkets, superstores, convenience stores, and warehouse clubs (that are not Costco).
• 3% rewards rate for restaurant and travel purchases worldwide. Cafes, bars, lounges, and fast-food restaurants fall under the restaurant category. While the following qualify for travel: flights, hotels, travel agencies, car rentals, cruise lines, and purchases with Costco Travel.
• 2% rewards rate for all purchases made at a Costco physical store, or online at Costco.com.
• 1% rewards rate on all other purchases.

As you can see this card offers high rewards rates in several bonus categories and it’s a great plus that you can earn rewards really anywhere. Let’s talk numbers to give you a sense of the potential rewards you can earn.

We’ll take an average U.S. household’s annual expenses for our example. According to the Bureau of Labor Statistics around 90% of American households spend on average $3,000 on gas annually, or $250 a month. This amounts to $120 cash back.

The average amount spent on dining out is around $3,000 a year. With the 3% rewards rate applied on restaurant purchases, that’s $90 in cash back.

The average cost of a vacation for a family of four is somewhere between $4,100 and $5,100. So, at least one vacation in a year that costs $4,600, will earn you $138 in cash back.

Furthermore, if you spend $400 a month on groceries, and you do your grocery shopping at Costco, you’ll earn $96 in cash back.

In total, that’s $444 cash back earned in a year for $15,400 spent, or 2.9% cash back for every dollar you spend. This doesn’t include the rewards for all the other purchases you’ll make, that don’t fall under the above-mentioned categories and earn you a 1% cash back. Still, this amount will definitely be worth it for both annual Costco membership fees. The Gold Star Membership fee is $60, and the Executive Membership fee is $120. The second one earns you a 2% rewards rate on eligible Costco purchases (up to $1,000).

Although the rewards rates are high, what might be a drawback for some people is the restricted redemption program. You receive your rewards only once a year. In February, after your billing statement closes, you’ll get an annual credit card rewards certificate.

The certificate can only be redeemed at a Costco warehouse, for cash back, or merchandise purchases, in a single transaction. According to Citi®, at the discretion of Costco, you can also redeem your rewards in the form of a check or electronic transfer. You also have a deadline to redeem rewards, until the 31st of December. If you don’t redeem your certificate by then or you cancel your membership before redeeming, you’ll lose your rewards.

To sum up, the rewards are really great, but they can be a bit of a hassle. You’ll have to wait for months to redeem them and you’ll be limited with time to do so. Still, the nice check you’ll get after a year will make this easier.

Who can benefit from getting the Costco Anywhere Visa® Card?

Clearly, the Costco Anywhere Visa® Card is best for people who frequently shop at Costco Warehouses. It’s also great for those who spend a lot on gas and dining out.

People who travel often can have a great value from this card too, as it will not only earn them rewards, but they also won’t be charged fees for international payments. This makes it a good alternative for some pricey travel cards. Also, the 3% rewards rate is for travel purchases worldwide, so if you plan a trip to Europe – don’t forget your card.

However, keep in mind the way rewards are redeemed. If you are someone who prefers having more choice and freedom about when and how you redeem your rewards, you might want to look into other cash back rewards cards.

As for your approval odds, apart from a Costco membership, a good credit score will probably be needed to get accepted for this card. This usually means a FICO score of at least 740.

Are there any other benefits?

Yes, some of them are:

• Purchase protection – this covers theft and damage. You can get repairs or a refund if the purchase was made with a Citi® card and you reported within 120 days.
• Extended warranty – your manufacturer’s warranty will be extended. This goes for purchases made with a Citi® card.
• Citi Entertainment® – this perk means you get free access to numerous entertainment experiences, including concerts, sporting events, theater, dining, and others.
• Digital Wallet – this feature enables you to quickly pay for products and services online.

Conclusion

We are impressed by the rewards rates the Costco Anywhere Visa® Card offers, especially as they are for bonus categories in which every individual or household spends significant amounts daily. Store cards typically don’t offer high rewards rates on purchases outside the appropriate store. As we already presented, it’s easy to pile up significant rewards even with average spending habits.

Regarding the redemption options, it’s reasonable that you have to redeem them at a Costco store, as it’s called a Costco card. The card can benefit even those who don’t regularly shop at Costco. Considering that the store offers a wide range of goods that cost hundreds of dollars, if you plan a big purchase from there you can benefit from the card by redeeming your rewards for it. You don’t have to earn your rewards at Costco, but you have to use them there.

Having that said, we don’t like that you get your rewards once a year and that you have a deadline. This limits the customers in several ways. However, if this represents no problem to you, we’d recommend to go for it!