The American Express Costco Card is one of the better cash rewards credit card in the market today. What we like about this card is that there are no tiers and for the most part (as we shall explain below), there are no limits as to much rewards you can earn.
Cash Rebates – The Amex Costco credit card rebate formula is as follows: You can earn 3% rebates for every dollar you spend on gasoline (for up to $3,000 in annual gasoline spending), 3% rebates at restaurants, 2% rebates for travel, and 1% for all other regular stuff you charge to you card. Aside from the gasoline expense, you can earn unlimited rebates.
How You Receive You Rebate Check – Each year (your card anniversary), you will receive a Costco in-store coupon which you can redeem for either cash or use at Costco.
Fees – Like most cards, this one has no annual fee. But you either need to already be a Costco member to apply for a card or if you are not, you will be enrolled in the Costco Membership, which has an annual fee of $40 (lowest tier).
Other Travel Perks – The Costco Card offers some pretty good (some standard) travel perks. Cardholders get $100,000 travel accident insurance when the card is used to buy travel tickets. You also get car loss and damage insurance so you do not have to pay the extra insurance when you rent a car using your Amex Card. There is also a Global Assist Hotline should you run into an emergency anywhere.
Entertainment Perks – Card members also get various entertainment perks and enjoy exclusive access and benefits in select markets with Ticketmaster through the American Express® Ticket Savings Center. These markets include Atlanta, Boston, Chicago, Dallas, Detroit, Florida, Houston, Los Angeles, Minneapolis/St. Paul, NYC tri-state area, northern California, Philadelphia, and Phoenix. American Express sponsors many shows and you will have access to tickets before the public gets access to them.
Shopping Perks – One of the nice benefits of this card is American Express Selects®, which allows you to find deals and savings from name-brand merchants on clothing, electronics, vacation packages, dinners, travel etc. You also get extended warranty feature where your warranty on products you buy with the card is extended for one additional year if the manufacturers warranty is less than five years. You also get a purchase protection feature where Amex will try to repair, replace the product or even reimburse you if you accidentally break it.
How does it compare with other cash back cards? – It’s quite hard to compare simply because the rebate structure is different. Blue Cash has a tiered formula and if you are a large spender, you can easily earn more than 2% with the Blue Cash. The Costco Card on the other is better in the case that there are no tiers and you earn more than 1% rebates on things like travel and restaurants that you do not get with the Blue Cash. I would say that combining these two cards would be pretty potent.
Right now, there aren’t any Visa or MasterCard out there that can match the cash back credit cards issued by Amex. Most pay a paltry 1% rebate. Others like Chase Freedom and the Discover Card has resorted to pay rebates on a quarterly rotating basis and paying rebates for shopping online through their shopping portal.
I think the Amex Costco Credit Card is a great cash back card both as a standalone card as well as a complimentary card to either the Blue Cash or the Discover More Card. We give this card the thumbs up and recommend this card.