The Costco credit card makes sense if you shop at Costco regularly and spend enough to recoup the annual fee through rewards
Costco offers two credit cards: the Costco Anywhere Visa Card (no annual fee) and the Costco Visa Signature Card (currently $120 annual fee). The choice depends on how much you spend and where. The Signature card returns 2% on Costco purchases and gas, 1% everywhere else. The Anywhere card returns 1% on Costco purchases and 0.5% everywhere else. If you spend less than $6,000 per year at Costco, the no-fee Anywhere card is the better choice. If you spend more, the Signature card's 1% extra return on Costco purchases can offset the fee — but only if you actually use it.
The real question is not whether Costco rewards are generous (they are not, compared to other cards), but whether you will use the card consistently and whether you already shop at Costco. A credit card is only worth its annual fee if you change your spending behavior to use it, not if you sign up and forget about it.
Key Takeaways
- The Costco Visa Signature card costs $120 per year and returns 2% on Costco and gas purchases, 1% everywhere else; the Anywhere card has no fee and returns 1% at Costco, 0.5% elsewhere.
- You need to spend at least $6,000 per year at Costco for the Signature card's rewards to cover its annual fee.
- Both cards require a Costco membership, which costs $60 to $130 per year depending on membership tier.
- The Signature card includes travel protections and roadside information that the Anywhere card does not, but these rarely offset the annual fee for most households.
- If you do not shop at Costco regularly or prefer to use a rewards card with no annual fee, the Anywhere card or a different card entirely may be the better choice.
How the rewards actually work
The Costco Visa Signature card returns 2% on all Costco purchases (in-warehouse and online), 2% on Costco gas stations, 1% on all other purchases. You earn the reward as a statement credit or as a Costco Cash certificate mailed to you once per year. The Anywhere card returns 1% at Costco and 0.5% everywhere else, with the same payout options.
The difference is meaningful only if Costco is where you spend most of your money. If you spend $10,000 per year at Costco, the Signature card returns $200 in rewards; the Anywhere card returns $100. That $100 difference covers the $120 annual fee and leaves you $20 short. But if you also buy gas at Costco and spend $2,000 per year there, the Signature card returns another $40, which pushes you ahead. The math works only when Costco is a significant part of your budget.
Neither card is competitive with no-annual-fee cards that return 2% on all purchases (like the Citi Double Cash or Capital One Quicksilver). The Signature card's advantage is that it concentrates rewards where you already spend money, not that it beats other cards overall.
The membership cost you cannot ignore
Both Costco credit cards require a Costco membership. A Gold Star membership (the basic tier) costs $60 per year. A Costco Visa Signature card costs $120 per year. Together, that is $180 in annual fees before you earn a single dollar in rewards.
You need to spend roughly $9,000 per year at Costco just to break even on both fees combined (assuming 2% rewards on Costco purchases). Many households do not spend that much at Costco, even if they shop there regularly. If you are considering the Signature card, calculate your actual Costco spending for the past year. If it was under $6,000, the card will cost you money.
The Anywhere card (no annual fee) is more forgiving because you only pay for the membership. But it also returns less, so the membership fee is harder to recoup if you do not spend heavily at Costco.
When the Signature card's other benefits matter
The Costco Visa Signature card includes travel protections that the Anywhere card does not: trip cancellation insurance, trip delay reimbursement, lost luggage reimbursement, and emergency medical and dental coverage while traveling outside the United States. It also includes roadside information (up to $100 per incident, up to four incidents per year).
These benefits sound valuable but rarely are. Trip cancellation insurance covers you only if you cancel for a covered reason (illness, injury, death of a family member) — not if you straightforward change your mind. The coverage limits are modest, usually $5,000 to $10,000 per person. Roadside information is useful if you drive frequently and do not have AAA, but most people either have roadside coverage through their auto insurance or do not travel far enough to use it.
For most households, these benefits do not justify the $120 annual fee on their own. They are a bonus if you already plan to use the card for Costco purchases, not a reason to sign up.
How the Signature card compares to other rewards cards
The Signature card's 2% return on Costco purchases is standard for store-branded cards. The problem is that it returns only 1% everywhere else, which is below average. A card like the Citi Double Cash returns 2% on all purchases with no annual fee. A card like the Chase Sapphire Preferred returns 3% on dining and travel with a $95 annual fee, which makes sense if those are your largest spending categories.
The Signature card makes sense only if Costco is where you spend the most money and you would not otherwise use a rewards card. If you already carry a 2% cash-back card, switching to the Signature card for Costco purchases and keeping your other card for everything else is unlikely to improve your rewards. You would earn the same 2% at Costco and lose the 2% you were earning elsewhere.
The Anywhere card is more defensible as a second card because it has no annual fee. You can use it at Costco (1% back) and keep another card for everyday purchases. But it is not a reason to sign up for Costco if you do not already shop there.
The real cost of switching cards
Signing up for a new credit card affects your credit score in two ways: a hard inquiry (small, temporary impact) and a new account (lowers your average account age). For most people, the impact is minor and recovers within a few months. But if you are planning to explore for a mortgage, auto loan, or other credit in the next six months, opening a new card is worth avoiding.
There is also a behavioral cost. If you sign up for the Signature card and then do not use it consistently, you are paying $120 per year for a card that sits in a drawer. This happens more often than people expect. The solution is to set a reminder to use the card for Costco purchases and gas, and to check your rewards balance once per year to make sure you are actually earning money.
Frequently Asked Questions
Do I need a Costco membership to get the credit card?
Yes. Both the Anywhere and Signature cards require an active Costco membership. You cannot use the card to shop at Costco without a membership, and you cannot hold the card without a membership. If you do not have a membership, the total annual cost is the membership fee plus the card fee (if you choose Signature).
Can I use the Costco credit card at other stores?
Yes, but the rewards are lower. The Signature card returns 1% on non-Costco purchases; the Anywhere card returns 0.5%. You would earn more rewards using a different card at other stores, so the Costco card is best used only at Costco and Costco gas stations.
What happens to my rewards if I cancel the card?
Costco Cash certificates are mailed once per year, usually in December. If you cancel the card before that date, you may lose any rewards you have earned that year. Check with Costco about the timing before you cancel.
Is the Costco credit card worth it if I only shop there occasionally?
No. If you visit Costco fewer than four or five times per year, the rewards will not cover the annual fee. The Anywhere card (no fee) is a better choice, or you could skip the card entirely and use a different rewards card for your everyday spending.
Can I have both the Anywhere and Signature cards at the same time?
No. Costco allows you to hold only one Costco credit card. You must choose between them.