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The Chase Freedom® is not currently available to new cardholders. Please visit our list of the best cash-back cards for alternative options.
Costco has inspired a cult-like following with shoppers dedicated to the bulk discounts, Kirkland products and low-cost rotisserie chicken. If you count yourself as a loyal Costco consumer, you've probably been asked to apply for the Costco Anywhere Visa® Card by Citi at checkout.
While the card offers a robust rewards program, you may wonder if it's really the best credit card for Costco purchases, offering 2% cash back on all eligible purchases from Costco and Costco.com.
When CNBC Select crunched the numbers and analyzed over 200 credit cards, we found that consumers can earn competitive rewards with the Costco Anywhere Visa® Card over a five year period. (See our methodology for more information on how we choose the best cards.)
Below, we break down the rewards, benefits and fees associated with the Costco Anywhere Visa® Card to help you decide if it's the right card for you.
- Credit required
- Additional benefits
- Bottom line
4% cash back on eligible gas for the first $7,000 per year (then 1%); 3% cash back on restaurants and eligible travel purchases; 2% cash back on all other purchases from Costco and Costco.com; 1% cash back on all other purchases
No current offer
$0, Costco membership required
N/A for purchases and balance transfers
15.24% variable on purchases and balance transfers
Balance transfer fee
Either $5 or 3% of the amount of each transfer, whichever is greater
Foreign transaction fee
See our methodology, terms apply.
Applicants need to have excellent credit to qualify for the Costco Anywhere Visa® Card. The exact credit score required varies, but a very good credit score ranges from 740 to 799 and excellent credit is 800 and higher, according to Experian.
Not sure what your credit score is? Here's how to check your credit score for free.
This card has a tiered rewards program that benefits commuters, foodies and travelers. Here are the rewards you earn:
- 4% cash back on eligible gas for the first $7,000 per year and then 1%
- 3% cash back on restaurants and eligible travel purchases
- 2% cash back on all other purchases from Costco and Costco.com
- 1% cash back on all other purchases
Surprisingly, you don't earn the most amount of cash back on Costco purchases, but 2% cash back is still competitive. Many of the best credit cards for grocery shopping exclude warehouses, such as Costco.
The Blue Cash Preferred® Card from American Express, for example, offers 6% cash back at U.S. supermarkets on up to $6,000 per year in purchases (then 1%) — but since Costco is excluded, purchases at the retailer will only earn 1% cash back. Therefore the Costco Anywhere Visa® Card is a better choice for frequent shoppers of the wholesale club (especially since Costco only accepts Visa-backed credit cards in-store).
Credit cards that offer quarterly rotating bonus categories, such as the Chase Freedom®, may include warehouse clubs, like Costco, as a bonus category — but only for one quarter. (Check out the current Chase Freedom® cash-back calendar.)
CNBC Select calculated how many rewards the average American can earn if they optimize the way they use their Costco Anywhere Visa® Card. We worked with the location intelligence firm Esri, who provided us with a sample annual spending budget of $22,126.
The budget includes six main categories: groceries ($5,174), gas ($2,218), dining out ($3,675), travel ($2,244), utilities ($4,862) and general purchases ($3,953).
Here's a breakdown of how much cash back you can earn in each category, annually:
- Groceries: $52
- Gas: $89
- Dining out: $110
- Travel: $67
- Utilities: $49
- General purchases: $40
- Total: $406
Based on the annual spending budget from Esri, the average American can earn an estimated $406 in the first year of card membership and $2,031 over five years. This assumes that cardholders are redeeming cash back for a typical value of 1 cent each. Extreme optimizers might be able to achieve more value, and you may earn a higher or lower return depending on your spending habits.
The cash back you earn is provided via an annual reward certificate once your February billing statement closes. You have to go to a U.S. Costco warehouse to redeem the certificate for cash or merchandise, which may be a hassle if you don't live near a Costco and instead shop on Costco.com. Learn more about how to redeem Costco credit card rewards.
In comparison, other credit cards allow you to redeem rewards online or via a mobile app, typically within one billing cycle of earning them. And there are even cards that award cash back at the end of every day, such as the Apple Card's daily cash program.
This card currently doesn't offer a welcome bonus, so you can't maximize rewards during the first few months of account opening.
The Costco Anywhere Visa® Card offers a variety of additional perks beyond its rewards program. Here are some key benefits:
- Travel and emergency assistance
- Worldwide travel accident insurance
- Worldwide car rental insurance
- Damage and theft purchase protection
- Presale ticket access and preferred seating with Citi entertainment
Terms apply for all benefits.
The Costco Anywhere Visa® Card has no annual fee, but requires an active Costco membership, which starts at $60 for gold star and doubles to $120 for executive level. If you already have a Costco membership, this isn't a deal-breaker. But if you piggyback off someone else's Costco membership or don't shop at the retailer but still want this card, you'll need to fork over at least $60 for a membership.
This card has a 15.24% variable APR on purchases and balance transfers and no foreign transaction fees.
The Costco Anywhere Visa® Card is a good option for loyal Costco fans and travelers who don't mind receiving rewards once a year.
However, if you don't shop at Costco regularly, or if you prefer to do most of your food shopping at supermarkets, consider other grocery rewards credit cards, such as the Blue Cash Preferred® Card from American Express.
And if you want a travel credit card, there are plenty of alternatives with more robust perks, such as the Chase Sapphire Preferred® Card, which offers auto rental collision damage waiver, baggage delay insurance and trip delay insurance. (Read CNBC Select's Chase Sapphire Preferred® review.)
To determine which credit cards offer the best value, CNBC Select analyzed 234 of the most popular credit cards available in the U.S. We compared each card on a range of features, including rewards, welcome bonus, introductory and standard APR, balance transfer fee and foreign transaction fees, as well as factors such as required credit and customer reviews when available. We also considered additional perks, the application process and how easy it is for the consumer to redeem points.
CNBC Select teamed up with location intelligence firm Esri. The company's data development team provided the most up-to-date and comprehensive consumer spending data based on the 2019 Consumer Expenditure Surveys from the Bureau of Labor Statistics. You can read more about their methodology here.
Esri's data team created a sample annual budget of approximately $22,126 in retail spending. The budget includes six main categories: groceries ($5,174), gas ($2,218), dining out ($3,675), travel ($2,244), utilities ($4,862) and general purchases ($3,953). General purchases include items such as housekeeping supplies, clothing, personal care products, prescription drugs and vitamins, and other vehicle expenses.
CNBC Select used this budget to estimate how much the average consumer would save over the course of a year, two years and five years, assuming they would attempt to maximize their rewards potential by earning all welcome bonuses offered and using the card for all applicable purchases. All rewards total estimations are net the annual fee.
While the five-year estimates we've included are derived from a budget similar to the average American's spending, you may earn a higher or lower return depending on your shopping habits.
Information about the Chase Freedom® has been collected independently by CNBC and has not been reviewed or provided by the issuer of the card prior to publication.