Advertiser Disclosure

Everyday Rewards: Costco American Express vs. AmEx Blue Cash Preferred

With so many websites offering free financial tools, it can be hard to know whom to trust. At NerdWallet, we spend literally 1,000s of hours researching partner offers and following strict editorial integrity to match you with the perfect choice. We even share how we make money so you can enjoy our expert advice and researched recommendations with total clarity and confidence.

THIS PAGE IS OUT OF DATE

In June 2016, Costco ended its partnership with American Express, and the TrueEarnings® Card from Costco and American Express was discontinued. Costco’s new co-branded credit card is the Costco Anywhere Visa® Card by Citi.

American Express now offers two Blue Cash cards: the Blue Cash Everyday® Card from American Express and the Blue Cash Preferred® Card from American Express. The entire Blue Cash line-up is tailored towards family spending. We favor the Blue Cash Preferred® Card from American Express over the Blue Cash Everyday® Card from American Express, since you get a much higher rewards rate for its annual fee of $95, which is offset by its signup bonus: $200 statement credit after you spend $1,000 in purchases on your new Card within the first 3 months. Terms Apply. The Blue Cash Everyday® Card from American Express also has a bonus: $150 statement credit after you spend $1,000 in purchases on your new Card within the first 3 months. Terms Apply. If you spend $61 a week at the supermarket, you’ll more than make up for the Blue Cash Preferred® Card from American Express’s annual fee.

Looking at these rewards categories, the question we had is how the Blue Cash Everyday® Card from American Express and the Blue Cash Preferred® Card from American Express compare to the issuer’s other family-friendly card: the TrueEarnings® Card from Costco and American Express, which in addition to being a great gas credit card, also privileges travel purchases.

The bottom line: Most people will do better with the Blue Cash Preferred® Card from American Express: it gives a whopping 6% back on up to $6,000 spent at U.S. supermarkets (then 1%) and includes U.S. gas stations and select U.S. department store purchases in its rewards categories, so you’ll earn extra cash back when you shop for clothing or home furnishings at Sears, when you buy groceries for a family of four at Safeway, and when you fill up while running your errands.

However, frequent Costco shoppers – particularly those who buy most of their gas there – will prefer the TrueEarnings® Card from Costco and American Express. Neither of the Blue Cash cards earns bonus rewards on Costco gas, while the TrueEarnings® Card from Costco and American Express does. The TrueEarnings® Card from Costco and American Express also pays out in once-a-year Costco vouchers, which have to be redeemed in-store, either for Costco goods or for cash.

So which one is best for you? Depends where you buy your gas

The deciding factor will be where you buy your gas: if you fill up primarily at Costco, you’ll be getting 3% back on gas with the TrueEarnings® Card from Costco and American Express rather than 1% with the Blue Cash. In fact, for all you Hummer owners out there, the TrueEarnings® Card from Costco and American Express is one of the best gas rewards credit cards around.

Beyond gas, the TrueEarnings® Card from Costco and American Express also offers bonuses for spending on U.S. restaurants and travel, while the Blue Cash cards favor U.S. supermarkets and select U.S. department stores. So a frequent traveler by land and air who dines out often might find the TrueEarnings to be a better deal. However, in order to make the Costco card worth it, you’d need to spend twice as much money dining out as you do on buying groceries, and spend $3 on travel for every $2 on department stores.

For those who don’t spend as heavily on the gas-travel-restaurant trinity, the Blue Cash Preferred® Card from American Express is a clear winner with its 6% back on up to $6,000 spent at U.S. supermarkets a year and 3% on select U.S. department stores, which encompass everything from T-shirts to bikes to toilet paper. Unlike the TrueEarnings® Card from Costco and American Express, the Blue Cash Preferred® Card from American Express offers a signup bonus: $200 statement credit after you spend $1,000 in purchases on your new Card within the first 3 months. Terms Apply. And rewards are paid out in cold hard cash back, whenever you’ve earned $25, rather than Costco vouchers you’ll only get once a year.

If you aren’t driving an SUV, feeding your spouse and 2.5 kids, or buying sundries at Target, you should probably take a look at one of the rotating-category rewards credit cards, like the Chase Freedom®.

Category Blue Cash Everyday® Card from American Express Blue Cash Preferred® Card from American Express TrueEarnings® Card from Costco and American Express
Signing bonus $150 statement credit after you spend $1,000 in purchases on your new Card within the first 3 months. Terms Apply. $200 statement credit after you spend $1,000 in purchases on your new Card within the first 3 months. Terms Apply. Earn cash back: 3% US gas stations up to $4,000 per year in purchases; 2% US restaurants & eligible travel; 1% other purchases. See details.
Annual fee $0 $95 None, but $50 Costco membership required
Base Rewards 1% 1% 1%
U.S. Supermarkets 3%** 6%** 1%
U.S. Gas (non-Costco) 2% 3% 3%***
Gas (Costco) 1% 1% 3%***
Select U.S. Department Stores 2% 3% 1%
U.S. Restaurants 1% 1% 2%
Travel 1% 1% 2%
Rewards Cash back Cash back Costco voucher, redeemable for cash
Rewards redeemed Anytime Anytime Once a year

**Up to $6,000 spent annually; otherwise 1%
***Up to $4,000 spent annually; otherwise 1%