Citi Costco Credit Card Review: Is It the Ultimate Cashback Card for You?
Author: physixfan
Published on: October 7, 2024
Last Updated: October 7, 2024
2024.10 Update: Historically, the Citi Costco Credit Card rarely offers a welcome bonus. However, right now, there’s an exceptional $75 welcome offer available, marking the highest ever for this card!
Benefits of the Citi Costco Credit Card
- $75 Welcome Offer: Earn $75 after spending $1,500 within the first three months.
- Receive 4% cashback at gas stations globally, including Costco stations; 3% at restaurants and on eligible travel; 2% at Costco stores and Costco.com; and 1% on all other purchases.
- No annual fee if you’re a Costco member.
- No foreign transaction fees.
Disadvantages
- Costco Membership Required: An active Costco membership is mandatory. Failure to maintain it could result in the cancellation of your Card Account and loss of program participation.
- Limited sign-up bonus.
- The 4% cashback rate applies only to the first $7,000 spent annually at gas stations, after which it drops to 1%.
- Cash back is issued as a Costco annual coupon, redeemable for cash at Costco, but less convenient.
Optimal Time to Apply for the Citi Costco Credit Card
- [8/65 Rule]: Apply for at most one Citi card every 8 days and two every 65 days.
- Aim to apply when you have fewer than six hard inquiries in the past six months.
- Establish a credit history of at least a year before applying.
Summary: Everything You Need to Know
The Citi Costco Credit Card is an excellent choice for those seeking a no-annual-fee cashback card. With its 4% cashback on gas, it stands out among its peers, and its 3% cashback on dining and travel expenses is highly competitive. For those who value cashback without an annual fee over points or miles, this card makes for a strong long-term option. However, its lack of a substantial sign-up bonus means the best approach might be to consider product changes or downgrades rather than applying outright.
Despite being a Costco-branded card, it’s not the top choice for Costco purchases. Costco only accepts Visa cards, and most card "Wholesale" categories offer low cashback rates. The US Bank Altitude Reserve can offer up to 4.5% rewards with Apple Pay/Android Pay at Costco, while the Chase Freedom Unlimited provides 1.5x UR points on all purchases, equivalent to an approximate 2.4% return. Alternatives like the Fidelity Rewards card offer a consistent 2% cashback.
Keep in mind that a current Costco membership is essential for card application, with membership fees at $60 (without extra cashback) or $120 (with additional 2% cashback at Costco). It’s worth pondering whether acquiring membership just for this credit card is worth it, considering the non-outstanding benefits. Trying a one-year membership might be a good start if you’re inclined to frequent Costco.
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