Note: The Amex Costco TrueEarnings credit card has closed to new applicants.

The Costco TrueEarnings American Express Credit Card offers some of the best overall rewards in the market, especially for those who like to dine out. The card will only suit those willing to shop at Costco at least once a year, since the “cashback” is actually given in the form of Costco vouchers. Those who don’t expect to shop at Costco should consider the American Express Platinum Cashback card instead—cashback rewards on that card come in the form of statement credits.

Costco TrueEarnings Credit Card Review

The Costco TrueEarnings American Express Credit Card offers arguably some of the best cashback rewards in the market, especially for a free card. Those who dine out a lot can extract the most value from the card, earning 3% cashback on dining. Rewards on travel bookings are also strong at 2%; and 1% cashback on all other spending (including Costco) is still very competitive.

If you know roughly how much you spend a month on restaurants, the chart below will give you an idea of the cashback you’ll receive at the end of the year from your dining spend, the highest-earning category:

Rewards Cap

There is no cap on rewards earned through dining or travel booking. While there is a £300 cap on rewards earned elsewhere on general spending, we don't expect most people will reach it. In order to hit this cap, you’d have to spend £30,000 a year on the card outside of the dining and travel categories.

How Amex Costco Rewards Work

Amex Costco "cashback" rewards are distributed once a year in the form of a Costco voucher—and you need to be a Costco member. Costco shoppers will love the rewards but those who don’t shop at Costco may find the “cashback” rewards to be a burden or may not be able to use their rewards. Big spenders might earn more Costco vouchers than they will use, especially those who don't shop at Costco regularly. For regular Costco shoppers, though, the rewards can be fantastic.

The Costco TrueEarnings card is only available to Costco members. If you are not already a Costco member, you need to become one. As the card will act as your Costco membership card as well, you need to have your photo taken at your nearest Costco. Once your membership and photo are in the Costco system, American Express can process your application. You will still have to pay the annual Costco membership fee.

Bottom Line: This can be a great rewards card for people who like to dine out and those who shop at Costco. Rewards are distributed as Costco vouchers; those who prefer rewards in the form of statement credits should look to the Platinum Cashback card, also from American Express.

Costco TrueEarnings Benefits & Features

Costco TrueEarnings Example of Average Annual Rewards

The Costco card will deliver different rewards for everyone, depending on their individual spending patterns. Consider the rewards a cardholders would earn from the following example of monthly spending:

Be sure to pay on time—you will lose all accumulated cashback for the year if you miss two consecutive monthly payments. Once your payments are up to date again, you will start earning cashback rewards again. That said, like all rewards cards, you should pay off your full balance every month anyway, or the interest payments will quickly wipe out your rewards, and then some. In order to be accepted for the Costco TrueEarnings card, you must have had no County Court Judgments for non-payment of debt.

How Does the Costco TrueEarnings Compare to Other Credit Cards?

To better understand the value of the Costco TrueEarnings American Express Credit Card you need to look at it in the context of other available options. We compared this card to other grocery rewards and cashback cards so you can see which has more earning potential for you.

Costco TrueEarnings vs Platinum Cashback Credit Card

The Platinum Cashback card from American Express is a solid, straightforward cashback credit card. The ongoing rewards rate is between 1% and 1.25% across all categories, depending on how much you spend. Cashback on the Platinum Cashback card is distributed once a year in the form of statement credits. The £25 annual fee is quite modest, and the first year is more than offset by the welcome rate of 5% cashback on all purchases up to £2,500 in the first three months (max £125 cachback in this period).

Quick Takeaway: When it comes to rewards rates, the Costco TrueEarnings has the potential to create more long-term value than the Platinum Cashback card, due to the double and triple rewards on travel and dining. However, those who prefer to receive their rewards as statement credit instead of a Costco voucher may prefer the simplicity of the Platinum Cashback card.

Costco TrueEarnings vs Platinum Cashback Everyday Credit Card

The Platinum Cashback Everyday card from American Express is another solid, straightforward cashback credit card, aimed at slightly smaller spenders. Cardholders don't pay an annual fee for this card, but do receive lower ongoing rewards rates between 0.5% and 1% across all categories, depending on level of spend. Cashback on the Platinum Cashback Everyday card is distributed once a year in the form of statement credits. Cardholers also can benefit from a welcome rate of 5% cashback on all purchases up to £2,000 in the first three months (max £100 cachback in this period).

Quick Takeaway: When it comes to rewards rates, the Costco TrueEarnings has the potential to create more long-term value than the Platinum Cashback Everyday card, due to the double and triple rewards on travel and dining. However, those who prefer to receive their rewards as statement credit instead of a Costco voucher may prefer the simplicity of the Platinum Cashback Everyday card, which is best for those spending less than £10,000 a year on their cards.

Costco TrueEarnings vs Nectar Credit Card

The Nectar Credit Card by American Express is a solid everyday rewards card. Cardholders will earn 1% of extra rewards by using the card, not just at Nectar partners but on all general spending. Nectar points earned via the Nectar Credit Card are in addition to base loyalty points you earn when you shop at Nectar partners, regardless of payment method. Additionally, a 20,000 point welcome bonus makes the Nectar card particularly appealing in the first year. Another year-one perk is that the annual fee of £25 is waived the first year.

Quick Takeaway: There is technically more long-term earning potential on the Costco TrueEarnings card, due to bonus rewards on dining and travel. The Nectar Credit Card looks stronger in the short term due to a healthy 20,000 Nectar point welcome bonus. Both cards offer solid returns. If you are deciding between the two, consider how much you travel and eat out at restaurants and also how you would like your rewards – as Nectar points, which are earned throughout the year and can be used at any of the Nectar retail partners, or a Costco voucher, which is delivered once a year and can be used at Costco.