A Costco membership is $65 a year and an Executive Membership costs an additional $65 upgrade fee a year. If you’re a frequent shopper at Costco, you are likely to have an Executive Membership which has the following benefits:
- You accrue 2% cash back (up to $1,250) when you make qualifying purchases at Costco warehouses, Costco Travel and Costco.com.
- To break even on the extra cost of an Executive Membership ($65), you’d need to spend $3,250 annually at Costco, or spending twice that amount would pay off the entire membership fee of $130.
- Each membership includes one free Household Card.
- Purchases made by the Primary and active Household Member apply toward the 2% cash back reward.
- If you have a Business Executive Membership, your affiliate member’s purchases will not count toward your 2% cash back reward.
- Executive Membership 2% earnings for shopping at Costco are regardless of the payment method used. You can choose to use your Capital One Venture VISA to earn 2 x points or use the Costco Citi card to earn an additional 2% cash back.
- The reward certificate is issued by Costco approximately 2 months prior to the membership renewal date.
- The annual 2% reward for Executive Members never expires and can be redeemed at any time for merchandise.
- Many Costco members are able to make one small purchase in the warehouse and get cash back at the register for the remaining amount of the reward. However, some Costco warehouses may give you a hard time.
Exclusions to 2% cash back earnings
It is important to note that not all Costco purchases are eligible for 2% Executive Member cash back (see image below).
Costco Anywhere Citi Visa Card benefits & pitfalls
All Costco members are eligible to apply for the Costco Anywhere Visa Card from Citi with the following individual benefits (unrelated to Costco Executive Membership):
- 4% back on gas purchases and EV charging purchases (everywhere except super-centers and grocery stores) for the first $7,000 per year and then 1% thereafter.
- 3% back at restaurants and travel purchases, including Costco Travel (uncapped earnings).
- 2% back on all other purchases from Costco and Costco.com and 1% on all other purchases (uncapped earnings).
- Zero foreign transaction fees.
- Travel accident insurance (up to $250,000), which covers the cardholder or family members if they are injured or killed while traveling on a common carrier (Citi card must be used to pay for the entire cost of the trip).
- Worldwide secondary auto rental insurance (up to $50,000), which technically works as primary while overseas when you have no other insurance (avoid using in the US if you have car insurance).
- This card no longer offers travel protections (discontinued in 2019).
- You will receive a separate Citi cash back certificate on your February billing statement annually and must be redeemed before December 31 of the same calendar year.
- To rapidly utilize an expiring Citi cash back certificate amounting to less than $500, I recommend buying a Costco Shop Card, which has no expiration date.
- If the Citi cash-back certificate value is greater than $500, you can transfer it directly to your bank account from the Citi App (by selecting Services, Rewards & Benefits, choose Costco Anywhere Visa@ Card by Citi and transfer to any bank).
Do you get 4% cash back by having both the Costco Executive Membership & Citi VISA?
Yes. You will receive two separate cash back certificates at different times of the year. The certificate issued by the Costco Executive Membership has no expiration date, but the one issued by the Citi VISA must be redeemed by the end of the year as explained above.
What happens if you replace purchases from Costco Citi VISA with Capital One Venture?
If you have a Costco Executive Membership, you will still receive the 2% annual cash back certificate. Since you will be using Venture or Venture X to pay for all Costco purchases, you will earn 2x Capital One transferable points. You will only be earning 2x points for gas, dining and travel compared to 4x and 3x earnings with the Costco Citi card. However, you will have primary car rental insurance in the US and overseas along with trip cancellation protection.
Are Capital One Venture X points more valuable than the Costco Citi cashback?
Points enthusiasts love earning & using points to get two to four times the value by booking international flights and hotels. It all depends on how often you travel overseas and how much you value cash over points (review). Some of my friends simply cash out all their MR, UR and C1 points on Amazon.com or PayPal.
Conclusion
We all love Costco and it is hard not to be an Executive Member there due to several benefits listed above. However, I will continue to use my Venture X VISA instead of the Costco Citi VISA since I value C1 points more than the cash back.