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Should You Apply for the Walmart Rewards Mastercard?

The revamped product puts the big-box store in the palm of your hand and rewards you handsomely. But it's not for everyone.
Sept. 25, 2019
Cash Back Credit Cards, Credit Cards, Rewards Credit Cards
Should You Apply for the Walmart Rewards Mastercard?
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Walmart sells virtually every household item you could ever need, from groceries, electronics and cosmetics to party supplies, auto parts and even gas in some cases. The new Capital One Walmart Rewards Mastercard aims to reward you more for those purchases, especially if you skip the maze of aisles in favor of shopping online.

The card — which is replacing the previous Walmart co-branded card issued by Synchrony Bank — earns:

  • 5% back on Walmart.com and Walmart app purchases, including grocery pickup and delivery.
  • 5% back on in-store purchases using Walmart Pay for the first 12 months (2% after that).
  • 2% back on in-store purchases (after the introductory 5% back period ends). This includes purchases at Walmart fuel stations.
  • 2% back on restaurants and travel.
  • 1% back everywhere else.

Those are impressive rates for a store-branded card. But is it right for you? Here’s how to figure that out.

Why you might want the Capital One Walmart Rewards Mastercard

1. You turn to Walmart for most household items

Store cards are the most rewarding when much of your budget is dedicated to that particular retailer. If Walmart is your source for both regular purchases (food, clothing, toiletries) and bigger buys (televisions, patio furniture, above-ground swimming pools), the Capital One Walmart Rewards Mastercard becomes a more compelling option. When it comes to rewards cards, earning more points where you spend the most is the sweet spot.

» MORE: NerdWallet’s best store credit cards

2. You’ve embraced technology

Shoppers who crave convenience and instant gratification will benefit from earning the highest rewards rate, which is reserved for Walmart.com and Walmart app purchases. That 5% rate extends to items you buy online and then pick up in store. You can also earn 5% back on Walmart Grocery Pickup and Delivery, a timesaver for anyone who dreads a trip to the grocery store.

The card’s digital focus begins before you make your first purchase. You can apply for the card online at Walmart.com or CapitalOne.com, but there’s also a mobile application; you can text to apply and then go through the application process from your phone. Walmart app users (including anyone who downloads the app once they get the Walmart card) can begin using their new card once their application is approved, even before the physical card arrives in the mail.

While the Capital One Walmart Rewards Mastercard lacks a sign-up bonus for new cardholders, it offers 5% back on in-store purchases made through the Walmart Pay digital wallet for the first year, making it that much more lucrative to use your digital wallet in those initial 12 months.

» MORE: NerdWallet’s best credit cards for online shopping

3. You seek flexibility when redeeming rewards

The Synchrony version of the Walmart card automatically converted your earnings into a monthly statement credit, but the Capital One Walmart Rewards Mastercard gives you a pretty wide range of redemption options, much like the variety of the items Walmart sells. Redeem your points for:

  • Statement credits.
  • Gift cards.
  • To cover a purchase.
  • Travel.
  • During checkout at Walmart.com.

4. You want no annual fee

Another popular retail card, the Amazon Prime Rewards Visa Signature Card, technically has a $0 annual fee. But you can get that card and its coveted 5% back at Amazon.com and Whole Foods only if you have an eligible Prime membership, which costs $119 a year ($59 a year for students). It’s like you’re paying an annual fee, in a way. That membership fee may well be worth it given the goodies you get from Amazon, but keep in mind that there is no membership requirement to get the Capital One Walmart Rewards Mastercard.

» MORE: Is it worth paying an annual fee for a credit card?

Why you might pass on the Capital One Walmart Rewards Mastercard

1. You’re loyal to a different ‘everything store’

Inertia is strong, and if you habitually turn to other retailers and are happy with them, the Capital One Walmart Rewards Mastercard may not motivate you enough to change how you shop. That’s especially true if you live closer to a Target or routinely make small Amazon purchases below that $35 free shipping threshold set by Walmart.com. The ideal retail card is one that meets you where you already shop.

2. You prefer to shop in person

Speaking of where you already shop, sometimes you just want to see products in person before you buy. But once you hit the one-year mark with the Capital One Walmart Rewards Mastercard, you’ll no longer earn 5% in-store by using Walmart Pay (your rewards rate will drop down to 2%). The Target REDcard™ Credit Card, a closed-loop card that can be used only at Target stores and on Target.com, earns 5% back in-store, online and at in-store Starbucks locations. The annual fee is $0, and unlike the Capital One Walmart Rewards Mastercard, you’ll get free shipping on all eligible items, regardless of how much you spend.

3. You want a higher rewards rate on specific spending …

Earning 2% back on restaurants and travel definitely elevates this card above store cards that reward you only for shopping at that specific retailer. But if dining out and travel make up larger line items on your budget, other cards dole out the points more generously or offer more optimal redemption values. The Uber Visa Card, for example, has a $0 annual fee and earns 4% cash back at restaurants.

The Chase Sapphire Preferred® Card earns the same 2 points per $1 on travel and dining as the Capital One Walmart Rewards Mastercard and there’s a $95 annual fee, but there’s a generous sign-up bonus: Earn 60,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $750 toward travel when you redeem through Chase Ultimate Rewards®. Also, points are worth 1.25 cents each when redeemed for travel, and you’ll also get access to more than a dozen travel transfer partners to which you can move your points.

4. … Or you don’t want to keep track of specific spending at all

Credit cards that offer tiered rewards can be lucrative, but they also require a bit of work. If you’re not interested in keeping track of bonus categories, consider a general cash-back credit card that offers the same high flat rate back on everything you buy. Look for a card that offers at least the industry standard of 1.5% back on all purchases. The Capital One Walmart Rewards Mastercard earns 2% back inside physical Walmarts, but some cards earn that same rate no matter where you use them.

» MORE: Citi Double Cash vs. PayPal Cashback: A battle of 2% back

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