Costco and Amazon offer rewards and benefits that every consumer will surely enjoy. But during this crisis, which card proves to be more useful?
Stockpiling on groceries is pretty common among Costco and Amazon shoppers, but with the coronavirus pandemic still in progress, it’s becoming more and more difficult for consumers to buy what they need, and what’s even more important, to get benefits for the purchases they make.
Here’s what you need to know about the credit cards each company offers so you can choose the option that best suits your needs.
Costco vs Amazon: Credit Card Rewards
The Costco Anywhere Visa® Card offers several cashback rewards for different kinds of purchases.
You can earn as much as 4% cash back on eligible gas worldwide, including Costco, for the first $7,000 per year, then it drops back to 1% afterward, 3% on any eligible restaurant and travel purchases worldwide, 2% from Costco and Costco.com, and 1% on all other purchases.
Amazon currently has 4 cards available. Each one offers different percentages on cashback rewards. With Amazon Rewards Visa Signature Card, earn 3% cash back at Amazon.com and Whole Foods Market; 2% back at restaurants, gas stations, and drug stores; and 1% back on all other purchases. A $50 Amazon.com gift card can also be received upon approval.
With an eligible Prime membership, the Amazon Prime Rewards Visa Signature Card raises the 3% cash back at Amazon.com and Whole Foods to 5%. Other cashback offers stay the same. The gift card, to be received upon approval, is now $70.
Amazon Prime Store Card offers a 5% cash back on Amazon.com with a $10 Amazon.com gift card upon approval. Amazon Store Card does not offer any rewards, but provides new cardholders with the same $10 Amazon.com gift card upon approval.
Both cards offer reasonable cash back rewards, but when you have to redeem rewards, they have different policies. Amazon cardholders will not have any problem with redeeming their rewards any time, but the same cannot be said for Costco cardholders. Rewards can only be redeemed once a year, and you’ll have to visit a U.S. Costco warehouse yourself.
Costco vs. Amazon: Credit Card Fees and APR
The Costco card and Amazon Visa cards have no annual fee, although you may need membership to keep your account open. Additionally, both cards do not incur an additional 3% foreign transaction fee when you use them outside the U.S. However, be reminded that some countries are still on lockdown and everyone is urged to practice social distancing to prevent the spread of the virus. It’s best to reserve this perk when it’s already safe. Can’t really travel that much if you’ll just end up sick and spend more on hospital bills, right?
As for APR, all purchases and balance transfers made with the Costco card will have the standard 15.24% variable APR. There are no offers on a 0% introductory purchase APR.
Amazon cards, on the other hand, provide special financing with 0% interest if you pay equal monthly payments on Amazon.com purchases:
- 6 equal monthly payments on purchases of $150 or more
- 12 equal monthly payments on purchases of $600 or more
- 24 equal monthly payments on select purchases
As long as you pay your dues on time, you won’t be charged with any deferred interest. Pay later than the financing offer and you’ll have to pay the cumulative interest starting from the day when you originally made the purchase.
The Benefits of Using Each Card
The Costco Anywhere Visa Card offers the following:
- Additional Costco Membership ID. Forgot your membership card? Use your credit card as an alternative.
- Travel and emergency assistance. Wherever you are, you’ll receive Costco’s assistance on travel services, from car rental insurance to emergency travel arrangements and trip cancellation protection.
- Damage and theft purchase protection. Damaged or stolen purchases using the Costco Anywhere Visa Card will be covered. An extended warranty of 24 months is also added automatically to any purchases.
- Access to tickets before they go on sale. With Citi Entertainment, you can land yourself a sure seat before they’re released and eventually gets sold out.
Both Amazon Prime Rewards Visa Signature Card and Amazon Rewards Visa Signature card offer the following:
- Travel and emergency assistance. Use these cards to pay for an air, bus, train, or cruise transportation, and you are eligible to receive accidental death or dismemberment coverage of up to $500,000. What’s more, they also offer an auto rental collision damage waiver and a dispatch for any roadside emergencies.
- Lost luggage reimbursement. Amazon covers up $3,000 of reimbursement per passenger on both damaged and lost check or carry-on luggage.
- Baggage delay insurance. For baggage delays over 6 hours, Amazon reimburses you for essential purchases like toiletries and clothing for up to $100 a day for 3 days.
- Damage and theft purchase protection. These cards will cover your new purchases for 120 days against damage and theft to $500 per claim and $50,000 per account.
- Visa Signature® Luxury Hotel Collection. From over 900 luxury hotels to choose from worldwide, cardholders can gain access to perks such as the best available rate, available automatic room upgrades and complimentary in-room WiFi, and a lot more.
- Visa Signature® Concierge Service. Earn complimentary Visa Signature Concierge Service 24 hours a day and gain tickets to sports and entertainment events or even dinner reservations.
Costco and Amazon Credit Cards: The Verdict
We have broken down the basics for you, but the choice is still dependent on where you are going to make your purchases.
Frequent Costco shopper? Then make use of the Costco Anywhere Visa Card and its travel perks. Just take into consideration the once-a-year reward redemption, and that the travel perks will have to wait until after it’s safe to go outside and most, if not all, establishments have opened up.
Loyal to Amazon and Whole Foods? Take advantage of the numerous rewards they offer on all four credit cards, especially if you are on a prime membership.
What you should keep remembering is to pay your dues on time, or else you’ll be paying more than the cost of your original purchases with the deferred interest. Also, Amazon may have more perks for the average traveler but with this pandemic, it’s safer to enjoy those at a later time than be sorry.
Still can’t decide between Costco and Amazon?
If the terms on both cards are fine with you, then maybe it’s a good idea to have two cards rather than be stuck on just one. For example, if you are still required to go to work despite the stay-at-home measures, i.e. frontline services, then swipe your Costco card to save up on gas.
If you have to stash on your weekly supply and Whole Foods has been your go-to, then choose any of the four Amazon cards. 2 credit cards may seem too much for your wallet, but you’ll end up enjoying the best of both worlds, just know when is the best time for each.
I’ve made a decision. Now what?
Great! We’ve answered the most important question so far. Knowing which card to use is not the end of the problem. Knowing HOW to use your credit cards is as important as knowing WHICH one to use.
First, before you splurge on any purchases—or even panic buy for that matter—it’s best to check your inventory first and take note of what you already have.
You don’t have to buy 20 rolls of toilet paper. Doing so just leaves you with unnecessary purchases and leaves others unable to buy the same things as you do. Remember that we are in a crisis and that doesn’t equate to selfishness.
Once you have created a catalog of everything that you have, it’s easier to identify which ones need purchasing. This way, you’re sure that whatever you’re buying is important.
Last but not the least, be prompt with the bills. Remember that a credit card is not a replacement for cash, so don’t buy more than what you can pay for. You wouldn’t really want to be bankrupt at a time like this, don’t you?
This pandemic doesn’t have to be as chaotic as we thought it would. Granted that we keep a sane mind and make sound decisions, we can manage to survive this crisis with the least amount of repercussions.