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The 5 best Visa cards for Costco purchases

April 10, 2020
7 min read
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Not only is Costco one of the largest retailers in the country, it's also one of the more restrictive when it comes to payment options. Costco only accepts Visa credit cards, which means you can't use a Mastercard or Amex to pay. Today we're going to take a look at the most rewarding Visa credit cards for you to use on your next Costco trip.

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Costco Anywhere Visa® Card by Citi

(Photo by John Gribben for The Points Guy)
(Photo by John Gribben for The Points Guy)

Annual fee: $0 (with paid Costco membership)

Welcome bonus: N/A

The first pick is the most obvious one, the cobranded Costco Anywhere Visa issued by Citi. This card earns cash back at the following rates:

  • 4% cash back on eligible gas worldwide, and EV charging purchases, including gas at Costco, for the first $7,000 per year and then 1% cash back thereafter
  • 3% cash back on restaurant and eligible travel purchases worldwide
  • 2% cash back on all other purchases from Costco and
  • 1% cash back on all other purchases

The sweet spot for this card is clearly gas purchases at Costco and other vendors, although note the cap of $7,000 at the 4% level per year (then 1%). Unfortunately the card doesn't offer any sort of welcome bonus, but because it doesn't charge an annual fee (with paid Costco membership), you can rack up cash rewards with no out-of-pocket cost. The cash back earned on the card is redeemed once a year as a reward certificate that comes after your February billing statement closes. Once you have the reward certificate, you can redeem it for merchandise or cash at a Costco location.

Read our review of the Costco Anywhere Visa card.

Chase Freedom Unlimited

(Photo by Wyatt Smith/The Points Guy)
(Photo by Wyatt Smith/The Points Guy)

Annual fee: $0

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Welcome bonus: Earn an additional 1.5% cash back on everything you buy (on up to $20,000 spent in the first year) - worth up to $300 cash back!

Since most cards don't offer bonus categories specific to warehouse clubs like Costco, your best bet is often to use a card that offers a strong return on everyday spending. Among all the Visa cards, none is better in this category than the Chase Freedom Unlimited. This no-annual-fee card offers 1.5% cash back on purchases with no cap.

If you also hold a premium Ultimate Rewards-earning card such as the Chase Sapphire Preferred® Card, Chase Sapphire Reserve® or the Chase Ink Business Preferred Credit Card, you can redeem cash back rewards as Ultimate Rewards points, effectively increasing your return on all purchases from 1.5% to 3%.

This could definitely be worth considering, especially if you're interested in redeeming for awards rather than only receiving straight cash back. With this card (provided you also have another UR-earning card in your wallet), you have the option to transfer rewards to a variety of travel partners.

Read our review of the Chase Freedom Unlimited.

Chase Freedom

(Photo by John Gribben for The Points Guy)
(Photo by John Gribben for The Points Guy)

(No longer open to new applicants)

Annual fee: $0

Welcome bonus: Earn $200 after spending $500 on purchases in the first three months of account opening

Not to be confused with the Freedom Unlimited, the Chase Freedom is nearly identical except for its earning structure. It has the same sign-up bonus, redemption options and no annual fee. The big difference is how you earn points.

With the Chase Freedom, you'll earn 5% back on your first $1,500 spent on rotating quarterly bonus categories (activation required), and 1% on all other purchases. Wholesale clubs like Costco normally appear on the bonus calendar at least once a year, giving you the opportunity to earn up to 5% back during this time frame.

Read our review of the Chase Freedom card.

The information for the Chase Freedom has been collected independently by The Points Guy. The card details on this page have not been reviewed or provided by the card issuer.

Chase Sapphire Preferred Card

Annual fee: $95

Welcome bonus: Earn 60,000 bonus points after you spend $4,000 on purchases in the first three months from account opening.

Due to its wholesale prices, Costco is a go-to for many shoppers looking to buy big-ticket items such as TVs and jewelry. If you plan to make a large purchase at this retailer, you might want to consider using this card due to its purchase protection policy. With the Chase Sapphire Preferred, you're covered for theft, damage or "involuntary and accidental parting" on eligible items for up to 120 days after you made the purchase (charging it to this card, of course). The policy will replace, repair or reimburse you for up to $500 per claim, with a maximum of $50,000 per account.

Even if you don't need this coverage, the Chase Sapphire Preferred Card could be worth using on Costco purchases since it earns you valuable Ultimate Rewards points. You'll only get 1 point per dollar at this retailer, since the card's only bonus category is 2x on travel and 3x on dining.

The Chase Sapphire Preferred Card has a $95 annual fee and no foreign transaction fees.

Read our review of the Chase Sapphire Preferred.

Alaska Airlines Visa Signature® credit card

Annual fee: $75

Welcome bonus: Buy one ticket, get one for just the taxes and fees ($0 fare plus taxes and fees from $22) and receive 40,000 bonus miles after spending $3,000 or more in purchases within the first 90 days of opening your account..

The last card on this list may be surprising to some, since it doesn't offer any bonuses on spending at Costco. Still, the Alaska Airlines Visa Signature card earns you 1 mile per dollar on everyday purchases (and 3 miles per dollar on eligible Alaska Airlines purchases).

TPG values these miles at 1.8 cents apiece — higher than any other airline currency. This is partly because of how hard it normally is to earn Mileage Plan miles, but also because of the incredibly unique and valuable redemption opportunities they offer.

Further Reading: Maximizing redemptions with Alaska Airlines Mileage Plan

From free stopovers on one-way awards to dirt cheap prices for premium cabin flights on Cathay Pacific and JAL, Mileage Plan is an incredibly valuable program, and shopping at Costco can help you rack up miles quickly.

Read our review of the Alaska Airlines Visa Signature card.

Bottom line

Picking the right card to use at Costco can be a challenge, between the general lack of bonus categories and the Visa-only policy. Whether you opt to earn cash back or travel rewards, there are a number of great credit cards that offer solid rewards when shopping at Costco.

Updated on 6/28/22.

Featured image by (Photo by Shutterstock)
Editorial disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airline or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.