- You already have a Costco membership, and you shop there often.
- You're committed to paying off most (if not all) of your balance every month.
- You don't mind waiting up to a year for your cash back rebate.
Here's the deal, especially if you've never shopped at Costco. You're going to pay up to $100 for an annual membership that gets you through the door at any of their popular warehouse clubs. Costco accepts American Express, but no other credit cards. Therefore, partnership means they're not bundling interchange fees into their prices. Your True Rewards card doubles as your Costco membership card, so you're not paying an extra annual fee to American Express. Rewards break out this way:
- 3 percent cash back on gasoline (up to $3,000 per year)
- 2 percent cash back in restaurants
- 2 percent cash back on travel
- 1 percent cash back everywhere else
American Express tallies up your rebates until you've had the card for a year. Then, they'll send you a voucher that you can redeem at Costco. Most folks treat it almost like a tax refund, and use it to splurge on a high-end item like an HDTV or a mattress. But, if you prefer cash, they'll convert that for you at the member services desk.
The only downside to the card is a relatively high APR, compared to other cash back rebate credit cards. Letting a balance roll over for more than a month or two could negate your rebate. However, True Earnings' simplicity makes it one of the best rewards credit cards on the market.
- I've been asked many times to upgrade my American Express card to platinum. I am especially interested in their companion ticket perk.
- About two years ago, I went through Chapter 7 bankruptcy. Will I be eligible for an American Express again?
- Which cards offer rental car insurance?
- I would like to get a credit card. I have 3 retail credit cards, a car loan and a personal loan. My credit score is about 628.
- What Is a Co-branded Credit Card?
- I'm looking for a credit card that I can use to simplify my bills and earn either rewards or cash back at the same time.
- What's typically better, cash back or rewards points?
- I have a credit score of 650 and need to re-establish my good credit. I won't carry a balance. Please advise regarding the credit card I can qualify for.
American Express no longer offers these terms. These were teaser rates to acquire customers ... I (for one) didn't need another credit card, but with the rates as noted above, I went ahead signed up. It took them some time to enact their bait-and-switch, but eventually they calculated that the cost of pissing of (and losing customers) would be less than the savings of changing their rates. I'm sure additional reductions will be seen down the road. It's a shame that a "premium" brand as strong as American Express has to resort to low-brow tactics no better than a used car salesman. Presumably it's this premium brand that allows them to get away with taking a higher percentage of each transaction. But as they become just another credit cards, maybe sellers can fight back. I'd certainly use my MasterCard more if the sellers offered a discount for not using Amex. Ugh.
Reply»Hi, Jon!I'm sorry you felt AmEx was trying to take advantage of you. From the time this original advice was given, American Express did reduce the restaurant reward from 3 percent to 2 percent. It's not what you may have signed up for, but certainly still one of the best cash back rewards on the market right now. It's also possible that changes to your credit profile or to your spending patterns may have caused American Express to reevaluate your rewards eligibility.It's frustrating, but I wouldn't take it personally. Instead, use our credit card database to find some alternate offers that match up with your spending patterns. For instance, if you're really trying to save money on dining out, check out Citi Forward. When you exchange their reward points for gift cards at national chain restaurants, you can earn as much as 5 percent back all year long.
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