What the Costco Credit Card offers
The Costco Anywhere Visa Card by Citi is the only credit card Costco officially endorses, and it's the card you'll see promoted at membership desks. It earns 4% cash back on gas (including Costco gas stations), 3% on restaurants and travel, 2% on Costco purchases, and 1% on everything else. There is no annual fee for the first year, then $65 per year after that — though Costco often waives the renewal fee if you ask.
The card is a Visa, so you can use it anywhere Visa is accepted, not just at Costco. You don't need a Costco membership to open the card, but you do need one to shop at Costco and redeem your rewards. The cash back posts as an annual statement credit in January, not as points you can spend throughout the year.
Citi also offers a Costco Anywhere Visa Card for Business, which has the same rewards structure but a $120 annual fee and slightly different earning categories (5% on Costco purchases, 2% on gas and restaurants, 1% elsewhere). This review focuses on the consumer card.
Key Takeaways
- The Costco card earns 4% on gas, 3% on restaurants and travel, 2% at Costco, and 1% everywhere else, with no annual fee the first year and $65 after.
- Cash back is paid once per year in January as a statement credit, not monthly or on demand, so you cannot use rewards to pay a bill mid-year.
- You must have a Costco membership to shop there, but the card itself does not require membership to open.
- The card's value depends on how much you spend on gas and at Costco; heavy grocery shoppers at other stores will earn only 1% there.
- Citi's approval standards are moderate, and the card reports to all three credit bureaus, so it can help build credit history if you pay on time.
How the rewards structure compares to other grocery and gas cards
The 4% on gas is strong — most cards cap gas rewards at 3%. However, the 4% only applies to Costco gas stations and other gas pumps, not to Costco's fuel discount program (which is a membership benefit, not a card benefit). If you buy most of your gas outside Costco, you're earning the same 4% as cards like the Citi Custom Cash, which also offers 4% on one category of your choice.
The 2% at Costco is middle-of-the-road for warehouse cards. The American Express Blue Business Plus earns 2% on purchases up to $50,000 per year, then 1% after that, but it's a business card. For consumer cards, 2% at a single retailer is standard; the Costco card doesn't beat it.
The 3% on restaurants and travel is useful if you eat out or book hotels often, but it's not exceptional. The Chase Sapphire Preferred earns 3% on those same categories and also earns points you can transfer to airline and hotel partners, giving you more flexibility on how to use your rewards. The Costco card locks you into a cash-back statement credit.
The real advantage of the Costco card is the combination: if you buy gas at Costco, shop for groceries there, and eat out, the card covers all three categories at above-average rates. If you shop primarily at other supermarkets, the card's value drops significantly.
Annual fee and whether it pays for itself
The $65 annual fee kicks in after your first year. To break even, you need to earn at least $65 in cash back annually. At 2% back on Costco purchases, that means spending $3,250 per year at Costco — roughly $270 per month. At 4% back on gas, you'd need $1,625 in annual gas purchases, or about $135 per month.
Most Costco members spend more than $270 per month on groceries and household goods, so the fee typically pays for itself. However, if you spend less than that or if you buy most of your groceries elsewhere, the card may not be worth the annual cost. Citi sometimes waives the renewal fee if you call and ask, especially if you've been a cardholder for several years, so it's worth asking before you cancel.
The first year is free, so there's no penalty to opening the card and testing whether the rewards cover the eventual fee. If you find you're not spending enough to justify $65 per year, you can close the card before the second annual fee posts.
How cash back works and when you receive it
Cash back on the Costco card is not earned and spent like points on other cards. Instead, Citi tallies your rewards throughout the year and issues a single statement credit in January. You cannot redeem rewards mid-year, use them to pay a bill, or transfer them to another account. The credit straightforward reduces your statement balance in January.
This structure is simpler than managing a points balance, but it's less flexible. If you want to use rewards to cover a large purchase in June, you cannot. You have to wait until January. If you close the card before January, you forfeit any unposted rewards, so timing matters if you're planning to cancel.
The statement credit is not taxable income, and it does not expire. If you don't use it to pay your January balance, it rolls forward to future months as a credit on your account.
Credit requirements and approval odds
Citi typically approves the Costco card for applicants with a credit score of 670 or higher, though approval is possible with lower scores if you have a strong income and low existing debt. The card is easier to get than premium travel cards like the Chase Sapphire Reserve, but harder than store cards with no credit check.
The process asks for your annual income, employment status, and existing debts. Citi pulls a hard inquiry on your credit report, which temporarily lowers your score by a few points. If you're denied, you can call the reconsideration line to discuss your process, though Citi rarely overturns a denial without new information.
Once approved, the card reports to Equifax, Experian, and TransUnion, so it builds your credit history if you pay on time. Carrying a balance and paying interest does not help your credit; only paying your full statement balance by the due date does.
Costco membership requirements and card restrictions
You do not need a Costco membership to open the Costco credit card. However, you do need a membership to shop at Costco and use the card there. If you don't have a membership, the card is useful only for gas, restaurants, travel, and non-Costco purchases — which means you're paying $65 per year for a card that earns 4% on gas and 3% on restaurants, both of which other cards offer without an annual fee.
If you have a Costco membership, the card is tied to your membership account. If your membership expires and you don't renew, you can still use the card outside Costco, but you lose access to Costco gas and shopping. Costco memberships cost $60 per year for Gold Star (basic) or $120 per year for Executive, so the card fee is separate from the membership fee.
The card is a Visa, not a Costco-branded card, so you can use it anywhere Visa is accepted. Costco does not restrict where you use it or require you to use it only at Costco.
Fraud protection and cardholder benefits
The Costco card includes standard Visa protections: zero liability for unauthorized charges, purchase protection (coverage if an item is damaged or stolen within 120 days), and extended warranty coverage (adds one year to manufacturer warranties up to $10,000 per item). These are common on most credit cards and are not a reason to choose this card over others.
The card does not include travel insurance, trip cancellation coverage, or concierge services. If you travel frequently and want those benefits, a premium travel card like the Chase Sapphire Preferred or American Express Platinum is a better fit.
Citi's customer service is available by phone 24/7. You can also manage your account online or through the Citi mobile app, which lets you view your balance, make payments, and track your rewards.
Alternatives if the Costco card doesn't fit your spending
If you don't shop at Costco or don't spend enough there to justify the annual fee, the Citi Custom Cash is a strong alternative. It earns 4% on one category of your choice (up to $20,000 per year, then 1%), 1% on everything else, and has no annual fee. You choose whether that category is gas, groceries, restaurants, or something else based on where you spend the most.
If you want higher rewards on groceries specifically, the American Express Blue Cash Preferred earns 3% on supermarkets (up to $150 per quarter, then 1%), 3% on transit, 1% elsewhere, and costs $95 per year. It's worth it only if you spend heavily on groceries and transit.
For gas and travel rewards without an annual fee, the Chase Freedom Unlimited earns 3% on dining and travel for the first year, then 1.5%, plus 1% on everything else. It's simpler than the Costco card but earns less on gas (1% instead of 4%).
The choice depends on where you spend the most money. If that's Costco and gas, the Costco card wins. If it's groceries at multiple stores, the Citi Custom Cash or Amex Blue Cash is better. If you want simplicity and no annual fee, the Chase Freedom Unlimited is the safer pick.
Frequently Asked Questions
Can I use the Costco card if I don't have a Costco membership?
Yes, you can open the card without a membership and use it for gas, restaurants, travel, and other purchases outside Costco. However, you cannot shop at Costco or use Costco gas without a membership, so the card's main benefit — 2% back at Costco and 4% at Costco gas — is unavailable to you. The $65 annual fee is hard to justify in that case.
When does the annual fee post, and can I cancel before it charges?
The annual fee posts on your card anniversary, which is one year from the date you opened the card. You can cancel anytime before that date to avoid the fee. If you cancel after the fee posts, Citi may refund it if you call within 30 days and ask, but there's no may provide.
Do I lose my cash back rewards if I close the card?
Yes. If you close the card before your January statement credit posts, you forfeit any unposted rewards. If you're planning to cancel, wait until after January to avoid losing a year's worth of cash back.
What's the difference between the Costco consumer card and the business card?
The business card costs $120 per year (vs. $65 for the consumer card) and earns 5% at Costco (vs. 2%), 2% on gas and restaurants (vs. 4% and 3%), and 1% elsewhere. It's worth it only if you spend heavily at Costco for business purposes and the higher earning rate covers the extra $55 annual fee.
Does the Costco card help build credit if I'm new to credit?
Yes. The card reports to all three credit bureaus, so on-time payments build your credit history and raise your score over time. Carrying a balance and paying interest does not help; only paying your full statement balance by the due date does. If you're new to credit, the Costco card is a reasonable choice, though a card with no annual fee is safer while you're building history.