Credit card at costco

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Costco just made a huge change — and furious customers are threatening to cancel memberships

Credit card at costcoLM Otero/AP Images

Costco's credit-card swap has customers calling the transition a "debacle" and threatening to cancel their memberships.

On Monday, Costco finalized its partnership with Visa and Citi that makes Visa the card of choice at the budget retailer, ending a 16-year partnership with American Express. With the change, Costco customers who earn rewards through a Costco co-branded credit card will need to use the Costco Anywhere Visa — not the TrueEarnings American Express Costco card.

However, many Costco members say they have not received their new Costco Visa credit card in the mail or are struggling to activate the new card.

Citi has been unable to keep up with questions and complaints from customers about the change, leading to some Costco members waiting for hours to speak with Citi representatives. Costco has 81 million members worldwide.

"The switch over from American Express to Citi Visa at Costco must be a huge mess," longtime Costco member Glenn Ginsburg wrote in an email to Business Insider. "Can't get to speak with a representative regarding my business credit card — have either been hung up on due to large call volume or waiting for 53 minutes to be transferred to another representative."

Ginsburg says that he eventually spoke with someone in Costco's corporate office who was unable to help beyond providing the phone number for Citi assistance that Ginsburg had already called. The Costco customer-relations employee told Ginsburg that Costco had been receiving similar calls from other members, and that while Costco had prepared for the change, Citi may not have put sufficient additional resources toward the project.

Credit card at costcoThomson Reuters

Many customers' biggest complaint for Citi is that they have not yet received their Costco Anywhere Visa, which was supposed to be shipped to cardholders in May. As of Monday, the TrueEarnings American Express Costco card — and any other non-Visa credit or debit cards — can no longer be used in Costco.

"I'm thinking that in spite of having many months to work out the distribution of new cards, Citi has committed a 'fail,'" a Costco member who hadn't received the replacement card wrote in an email, calling the switch a "debacle." "Costco may live to regret cutting off AmEx."

Citi responded on Twitter to customers frustrated by long wait times.

@JudyMcC01 Thx 4 reaching out. We're experiencing a high volume of inquiries due to interest in our new Costco card. We'll help u ASAP. ^JT

@nilkamath Thx for reaching out. We're experiencing a high call volume due to interest in our new Costco card. We'll assist you ASAP. ^ML

@SGPlunkett We're sorry for the delay. If you still need help pls click and send your ph# only (NO acct #/PINS). ^ML https://t.co/wD8JmPaCwf

Other users expressed their anger on Facebook.

The most common problem expressed in posts on Costco's Facebook page — which has been flooded with complaints — are from users who have not yet received their credit cards.

"The Costco-Visa was a huge unorganized mistake," writes one Costco member. "I have spent over ten hours — over the last 4 weeks — on the phone trying to find out where my new card is, and I still can't get a straight answer."

Credit card at costcoThe Costco Anywhere Visa Card by Citi. Citi Costco

"This new 'relationship' with Citibank is a SHAMEFUL OUTRAGE!!" reads another complaint. "I do not have a valid card. I was LIED TO about cards being sent overnight at Citibank's expense. You are losing my monthly groceries, my office supplies, and our family travel business."

Again, the problem of the missing cards and other Costco Visa card confusion has been further complicated by Citi's inability to deal with the volume of calls from customers.

"Worst credit card transition ever — 4 hours and counting on the phone with Citibank and they still can't get my cards to me," writes one customer. "Costco customer service was zero help getting me a temp card at the warehouse too. Saving money isn't worth alienating your members . seriously rethinking my patronage."

Difficulties related to the credit-card swap have a number of customers threatening to boycott or cancel their memberships.

"To date, more than 11 million cards have been issued to existing Costco cardmembers," CitiВ spokesperson JenniferВ Bombardier told Business Insider on Wednesday. В "Due to the tremendous response, some customers experienced delays reaching customer service, however call volumes are starting to return to normal.В We sincerely apologize to those who have been inconvenienced and are absolutely committed to serving our existing and new cardmembers."

Costco's new credit card has some of the best rewards on the market, significantly improving on the benefits of the Costco American Express card. However, if customers aren't receiving or can't activate their new Costco Visa cards, the quality of the rewards, frankly, will not matter to some Costco members who are now unable to shop at the retailer.


The Best Visa Card To Use At Costco Is Not The Costco Visa

Credit card at costco

Costco started accepting Visa this week. Costco American Express cardholders received the replacement Costco Visa card from Citi.

I don’t have the Costco American Express card. Nor do I have the new Costco Anywhere Visa card by Citi.

Back when Costco only accepted American Express cards, you could use any American Express card, not just the the Costco AmEx card. In fact the Costco AmEx card wasn’t the best American Express card to use at Costco. The Fidelity AmEx card was, because you could get 2% rewards instead of just 1% from the Costco AmEx card.

Now that Costco switched to Visa, you are able to use any Visa card, not just the new Costco Visa by Citi. As I predicted in my previous post Anatomy Of A Co-Branded Credit Card, it still remains that the best Visa card to use at Costco isn’t the Costco Visa.

You will get 2% rewards from the new Citi Costco Visa for purchases at Costco, which is better than the 1% rewards from the old Costco AmEx. Several Visa cards match it at 2%, including Citi’s own Double Cash Visa Capital One’s Spark Cash for Business and the new Fidelity Visa by Elan. Several other cards actually beat it by quite a bit.

The Bank of America Travel Rewards Visa with Preferred Rewards program at the 75% bonus tier pays 2.625% rewards on every purchase, whether at Costco or not. That’s a good 30% more than the new Costco Visa, without having to worry about which card to use where. Just use the same card everywhere.

The grandfathered Priceline Rewards Visa pays 3.33% on every purchase if you redeem the rewards against Priceline Name Your Own Price or Express Deals purchases. You get 2/3 more in rewards, although you must already use Priceline’s Name Your Own Price or Express Deals often enough to redeem your points at the higher rate. You also must already have a grandfathered Priceline Rewards Visa card because the current cards aren’t as good.

It gets better. The Bank of America Cash Rewards Card pays 2% on wholesale club purchases. At the 75% bonus tier in the Preferred Rewards program, it pays 3.5% rewards on Costco purchases. That’s 75% more than the Citi Costo Visa pays.

You get to the 75% bonus tier under Bank of America’s Preferred Rewards program when you have a Bank of America checking account and you hold say $100k in ETFs at Merrill Edge. Holding $100k in ETFs at Merrill Edge costs you nothing. You actually get a welcome bonus and monthly free trades. At the 75% bonus tier, the Bank of America checking account is also free, with no minimum balance or direct deposit requirement.

The rewards from the Bank of America card can be automatically deposited to your Bank of America checking account whenever you reach a threshold. You don’t have to wait until the end of the year. There’s a cap for $2,500 per quarter in combined grocery/wholesale club/gas purchases each quarter. At my spending level, I expect to come well under that cap.

Coincidentally, Chase Freedom card put wholesale clubs into its 5% rewards categories through the end of 2016. In the next several months, up to $1,500 in purchases in the special categories per quarter, using Chase Freedom at Costco will get you 2-1/2 times the rewards as using the new Costco Visa.

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A Complete Review of the Costco Anywhere Visa® Card by Citi

*Editorial Note : This content is not provided or commissioned by the credit card issuer. Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by the credit card issuer. This site may be compensated through a credit card issuer partnership.

This post contains references to products from one or more of our advertisers. We may receive compensation when you click on product links. For more information, please see our Advertiser Disclosure

The new Costco Anywhere Visa® Card by Citi has finally arrived. Ever since Costco ended its relationship with American Express last year, many loyal shoppers have been eagerly awaiting the release of this new credit card. The Costco Anywhere Visa Card is now accepting new applicants and the rewards and perks are better than ever!

There have been a lot of questions around the Costco Credit Card transition. But now that the shift is complete, cardholders can begin enjoying the great rewards and benefits of the Costco Anywhere Visa® Card by Citi.

If you are a previous account holder with the Costco Card from American Express, you should have already received your new Citi card in the mail. Now that the June 20 th transition date have arrived, you can activate your Citi Costco Card and begin using it for your everyday purchases.

The new Costco Anywhere Visa Credit Card comes with a very generous rewards program. Here are the details on the cash back you will earn:

      • Credit card at costco4% cash back on eligible gas worldwide, including gas at Costco, for the first $7,000 per year and then 1% thereafter
      • 3% cash back on restaurant and eligible travel purchases worldwide
      • 2% cash back on all other purchases from Costco and Costco.com
      • 1% cash back on all other purchases

If you're already a Costco Member, this credit also has no annual fee, so you can earn tons of cash back without having to pay a fee to earn rewards.

Costco customers are some of the most loyal shoppers in the country – and for good reason! While you do have to pay an annual membership fee, there’s no doubt that shopping at Costco can save you lots of money on groceries, household items, and much more.

With the Costco Anywhere Visa® Card, your Costco membership is more rewarding than ever. The Citi Costco Credit Card is the only card that offers 4% cash back on gas. Unlike most other gas rewards credit cards, you earn bonus cash back at gas stations worldwide, not just within the U.S.

Credit card at costco

The Costco Anywhere Visa Card offers 4% cash back on eligible gas worldwide.

This card also earns a generous 3% cash back at restaurants and eligible travel purchases, 2% cash back at Costco and Costco.com, and 1% back on everything else. These categories come with no limit on the amount of rewards you earn.

Cardholders will also enjoy an intro APR of 0% for 7 months. That makes this the perfect card for financing a big purchase and earning rewards at the same time. The ongoing APR for this card is a competitive 15.49% Variable.

This is a major improvement from the old TrueEarnings® Costco Card from American Express which only offered 3% cash back at U.S. gas stations with a $4,000 annual cap (then 1%).

Citi and Costco have worked to make the transition from the American Express Costco Card to the new Citi Costco Anywhere Visa as seamless as possible for existing cardholders. If you’re a former cardholder of the Costco Card from American Express, here are some quick facts that you may be curious about:

      • You should now begin using your new Costco Anywhere Visa® Card by Citi
      • The only action you need to take to phase out your old Costco Amex is to destroy your card and provide the new card information to any recipients of automatic payments on your account.
      • Your account balance will automatically transfer from your Costco Amex to the new Citi Card
      • Your old account will automatically be deactivated and closed down
      • The rewards balance from your Costco Amex will be automatically transferred to your new card
      • Citi won’t pull a credit report as part of the account transfer process

It’s no secret that being a Costco member comes with incredible perks and benefits. With the new Costco Anywhere Visa® Card by Citi, you now have the chance to earn more rewards than ever on all of your purchases.

By offering 4% cash back at gas stations worldwide, this credit card is an industry leader for gas rewards credit cards. You even earn unlimited 3% cash back on dining and travel, 2% on all Costco purchases, and 1% on everything else. When you top it off with other Citibank perks such as Citi® Private Pass, Extended warranties, plus damage and theft purchase protection, you'll see why so many Costco members are signing up for this card! Sign up today and start earning valuable cash rewards!

*Editorial Note: This content is not provided by Citibank. Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone, and have not been reviewed, approved or otherwise endorsed by Citibank.

*The content in this article is accurate at the publishing date, and may be subject to changes per the card issuer.

Credit card at costco

Did the length of your kid’s back to school shopping list surprise you? It’s no wonder, back to school and college spending ranks as the second biggest shopping season for.

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Last year, consumers spent over $19 Billion on Valentine's day. Between all those flowers and chocolates there's an opportunity to earn a hefty amount of points, miles, or cash back.

February 9, 2017

Black Friday is just around the corner and many shoppers already keeping an eye out for this year's best deals. It's no secret that the day after Thanksgiving can be.

November 16, 2016

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What’s the Best Costco Credit Card for Rewards on Purchases?

Saturday, October 1, 2016

The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities.

Credit card at costco

Nick Clements has worked in consumer banking for nearly 15 years and is the co-founder of MagnifyMoney.

Credit card at costco

As of June 20, Costco now allows you to use any Visa credit card for purchases, and no longer accepts American Express cards.

This also marks the end for the Costco True Earnings Card from American Express, which is replaced by the new Costco Anywhere Visa credit card from Citibank

Credit card at costcoYou can now apply for the card even if you didn’t have a Costco Amex.

The Costco Anywhere Visa is still a no annual fee card if you have an active Costco membership, and the rewards are much better than the old Costco True Earnings Amex.

  • 4% cash back on gas worldwide (not just at Costco) up to $7,000 in purchases each reward year – vs 3% before
  • 3% at U.S. restaurants and on eligible travel (airfare, hotels, car rentals from major companies listed here, Costco Travel, cruise lines, and travel agents) – vs 2% before
  • 2% on all Costco and Costco.com purchases – vs 1% before
  • 1% on all other purchases

That’s great news for Costco True Earnings cardholders who haven’t seen a change in rewards for many years.

But if those rewards aren’t good enough, you can use any Visa card you’d like at Costco. You don’t have to only use the Costco Visa from Citibank, which opens up a lot of options.

You will need to go to Citi’s online portal and log into your account in order to make a payment.

So, can you do better than the new Citibank Costco Visa?

If you have a Navy Federal Credit Union Visa, you can get an extra 2% cash back on all warehouse club purchases until December 31. That’s on top of the rewards you’re already earning, and there’s no limit to the extra cash back, so this could get you up to 4% in reward value with cards like the Flagship Rewards card.

The Visa Rewards Card from InFirst Credit Union has the exact same earning as the Costco Anywhere Visa, including 4% gas, 3% travel / dining, and 2% at warehouse clubs. The difference is it has no cap on 4% gas earning, and even if you aren’t a Costco member you can get this card. There’s no annual fee, but you need to join the NARFE for $40 to be eligible to be a member of the credit union unless you have another affiliation.

For the longer term, thanks to Fidelity and US Bank, earning good rewards on Costco purchases with your credit card is easy.

The Fidelity Rewards Visa Signature earns unlimited 2% cash back on every purchase, including at Costco.

Credit card at costcoYou don’t have to be a Fidelity customer to get the card, though if you want the full 2% rewards you need to deposit them in a Fidelity account, which they’ll open automatically when you apply.

If that’s not appealing, we mined our card database to find no annual fee Visa cards that you’ll be able to use at Costco to earn 2% cash rewards at more places than Costco:

2% on Costco purchases: BankAmericard Cash Rewards Visa

This card offers 2% cash back at warehouse clubs like Costco and Sam’s Club, but only up to $2,500 in spending each quarter. There’s no annual fee. It also offers 3% back on gas and 2% at grocery stores, and spending in these categories counts toward the $2,500 per quarter limit.

2% on Costco purchases: NASA Federal Credit Union Platinum Cash Rewards Visa

Credit card at costcoOnce you spend $2,000 on the card each year, all your purchases beyond $2,000 earn 2% cash back, unlimited, with no annual fee. Anyone can join the NASA Federal Credit Union by becoming a member of the National Space Society, which costs $20.

Your first $1,000 a year in purchases earns 1% cash back, $1,001 – $2,000 earns 1.25%, and $2,001 or more earns 2%.

And if you like travel rewards, remember, any Visa card you have can be used at Costco starting June 20th, so if you like those rewards better than cash back, you’re in good shape with the cards you already have.

4% on Costco gas with the Citibank Costco card is pretty decent, but you can do a bit better without limits.

One of the most lucrative gas rewards cards is the PenFed Platinum Rewards Visa which earns 5x points on gas purchases, which when you use the points for Visa gift cards gets you a touch over 4% cash back on gas.

The catch is PenFed requires your purchase to be for gas ‘at the pump,’ which is signaled by Visa merchant code 5542.

According to MyFICO forum readers Costco doesn’t use that merchant code for gas purchases.

The Fort Knox Credit Union's Visa Platinum earns 5% cash back on gas, but doesn’t have the ‘at the pump only’ limitation, though we’ve seen no confirmation it will work for 5% cash back at Costco gas stations.

Same goes for the AARP Visa which offers 3% back on gas with no annual fee, but doesn’t specifically limit gas purchases to those made ‘at the pump.’

Here’s what Chase’s website (which issues the AARP Visa) has to say about how it classifies gas purchases:

“Merchants in the gas stations category sell automotive gasoline that can be paid for either at the pump or inside the station, and may or may not sell other goods or services at their location. Please note that some merchants that do not specialize in selling automotive gasoline are not included in this category; for example, truck stops, boat marinas, oil and propane distributors, and home heating companies.”

So there might be a chance it works, but for now no guarantees until Costco switches to Visa on June 20, 2016 and it’s put in use.

Credit card at costco

Nick Clements is a writer at MagnifyMoney. You can email Nick at [email protected]

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Advertiser Disclosure: MagnifyMoney is an advertising-supported comparison service which receives compensation from some of the financial providers whose offers appear on our site. This compensation from our advertising partners may impact how and where products appear on the site (including for example, the order in which they appear). To provide more complete comparisons, the site features products from our partners as well as institutions which are not advertising partners. While we make an effort to include the best deals available to the general public, we make no warranty that such information represents all available products.

Building Credit, Credit Cards, Earning Cashback, Reviews

QuicksilverOne Review: Unlimited 1.5% Cash Back for Average Credit

Tuesday, August 8, 2017

The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities.

Credit card at costco

Taylor K. Gordon is a freelance blogger and personal finance junkie who lives in the nation's capital.

For people with “average” or “fair” credit, Capital One offers QuicksilverOne Rewards. Every credit card issuer has a different definition of what “average” or “fair” credit means. Generally speaking, it means a FICO score between 580 and 669.

The QuicksilverOne Rewards card gives you an unlimited 1.5% cash back, which is a pretty sweet opportunity for consumers with less-than-perfect credit.

Just beware of the two catches: There’s a $39 annual fee and a high purchase APR.

Credit card at costco

on Capital One’s secure website

The QuicksilverOne Rewards program is low maintenance.

Unlike other programs with revolving categories and spending caps, this card doesn’t hold you to either. You will earn 1.5% cash back every time you swipe.

You can redeem cash back at any time for a check, account credit, or gift card. Cash back you earn never expires.

We like that the cash back program terms are uncomplicated. There are no preset bonus categories that you have to adapt your spending to each month. You can also redeem cash back at any time without having to wait for the balance to reach a certain threshold.

The QuicksilverOne is one of the only cash back rewards cards around town for average credit. If you’re having trouble getting approved elsewhere, this is a card you need to seriously consider.

Since this card costs $39 per year, you need to spend at least $2,600 per year (or $217 per month) for the cash back to break even with the fee. Ideally, you’ll want to spend more than just the bare minimum for the rewards card to be worthwhile.

This is a high interest rate. Avoid carrying a balance at all costs if you choose this card.

Again, the QuicksilverOne is our top unlimited cash back pick for consumers who have trouble getting approved for other cash back cards.

According to Capital One, you may qualify for this card if:

  • You have defaulted on a loan in the past five years
  • You have limited credit history
  • You have had your own credit card or other credit for less than three years (this may include students, people new to the U.S., or authorized users on someone else’s credit card)

Keep in mind, these are just guidelines to give you a general sense of whether you’ll qualify. Your income, debt, and other credit limits are also factors used to make a decision.

Capital One has a nice feature where you can get preapproved online for offers without a hard credit inquiry. See if you prequalify for the QuicksilverOne card here.

Keep an eye out for the Quicksilver alternative while checking offers as well.

Quicksilver Rewards is the “big brother” of the QuicksilverOne card. It has no annual fee, and it’s for people with excellent credit. There’s no harm in checking to see if you prequalify for the Quicksilver card.

Is the QuicksilverOne card good for rebuilding credit?

Despite the lenient qualifying criteria, the QuicksilverOne card is not our top recommendation if you’re rebuilding credit, because of the annual fee.

Your focus should be keeping your credit utilization very low when rebuilding credit. You shouldn’t worry about having to earn enough cash back each month to cover a card’s annual fee.

  • Travel accident insurance and 24/7 roadside assistance. Travel insurance for death or loss of limbs. You can call in for help if your car breaks down.
  • Auto rental insurance. Insurance covers rental damage from collision or theft.
  • Extended warranty. Purchases made on your card will get an extended warranty.
  • Price protection. You can get reimbursed the difference if you find items you purchased on sale within 60 days.
  • Fraud coverage. Covered by $0 fraud liability if your card is lost or stolen.

QuicksilverOne doesn’t have much competition since it’s the best card for consumers with average credit. The following no-fee cash back cards officially require good to excellent credit but allow you to prequalify without a hard inquiry.

$0 For First Year

The Chase Freedom Unlimited card gives you an unlimited 1.5% cash back on all spending without category restrictions or caps. What’s great about Chase is it’s another credit card issuer that lets you prequalify for offers without a hard pull. Check out offers you may prequalify for here.

You can redeem cash back from your Chase Freedom Unlimited card at any time, and cash back never expires as long as you keep your account open. At times there is an intro APR deal or cash back bonus offer that add benefits to this card, and ongoing rates are sometimes lower than what you’d see on the QuicksilverOne.

$0 For First Year

The Citi Double Cash card is another good choice for low-maintenance cash back rewards. It gives double cash back on all purchases. You earn 1% cash back when you spend on the card and another 1% cash back when you pay off the bill.

This is a card that members report qualifying for with a credit score in the high 600s. Citi lets you shop for prequalified offers on the website as well. If you’re interested in this card, see if you can get prequalified here. In addition, there are changing intro APR deals for this card that allow you to save interest early on, and ongoing interest rates are sometimes lower than with the QuicksilverOne.

The QuicksilverOne Rewards is a good rewards card for those with average credit. If you have had difficulty being approved for other higher cash back rewards cards, you may be approved for the QuicksilverOne Rewards, which offers unlimited 1.5% cash back. Be aware that this card comes with an annual fee and high APR, so make sure to do your research and see if this card is right for you.

You should not keep a balance on this credit card to benefit from the cash back. The high APR is a large amount of interest to be paying on purchases. If the interest charges you experience on this card coupled with the annual fee surpass the cash back you earn, this card is pointless.

Does QuicksilverOne have any purchase restrictions?

No. You’re free and clear to spend money on anything, and it’ll earn 1.5% cash back. This is the beauty of an unlimited cash back card. However, cash advances and balance transfers will not qualify for cash back.

No, cash back does not expire as long as your account remains open.

Can I do better than 1.5% on an unlimited cash back card?

You can, but not with average credit. The QuicksilverOne card is the best unlimited cash back card there is specifically targeting people with fair credit. Another option you have is working to improve your credit first before applying for a credit card to qualify for a card that gives you more cash back.

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Taylor Gordon is a writer at MagnifyMoney. You can email Taylor at [email protected]

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This Cash Back Number May Surprise You

Advertiser Disclosure: MagnifyMoney is an advertising-supported comparison service which receives compensation from some of the financial providers whose offers appear on our site. This compensation from our advertising partners may impact how and where products appear on the site (including for example, the order in which they appear). To provide more complete comparisons, the site features products from our partners as well as institutions which are not advertising partners. While we make an effort to include the best deals available to the general public, we make no warranty that such information represents all available products.

The Discover it Secured Card wins: No fee, Free FICO and up to 2% cash back

Tuesday, August 1, 2017

The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities.

Credit card at costco

Nick Clements has worked in consumer banking for nearly 15 years and is the co-founder of MagnifyMoney.

Credit card at costco

Discover offers the Discover it® Secured Card – No Annual Fee for people who are looking to build credit and establish good credit history. Secured credit cards are an excellent way to build your credit with responsible use. With this product, Discover has created one of the best secured cards on the market. You do need to make a security deposit of $200 or more to establish your credit line (up to the amount that Discover can approve). If you are unable to afford the $200 deposit, you should consider the Capital One Secured MasterCard, which only requires a $49 deposit. But if you can afford the $200 deposit, this card is clearly one of the best no fee secured credit cards available.

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Here are the key product features:

No annual fee: There is no annual fee on this card. You do need to make a security deposit of at least $200. If you want a bigger limit, you will have to make a bigger deposit.

Automatic monthly reviews starting at 8 months: After just eight months, Discover will start monthly automatic reviews of your account to see if you can be transitioned to an account with no security deposit. With an 8-month review, Discover has one of the best upgrade policies in the market.

Earn cash back: Most secured credit cards do not offer any rewards. With Discover it, you have the opportunity to earn cash back while earning rewards. You can earn 2% at restaurants and gas stations (on up to $1,000 of combined purchases each quarter). Plus, get 1% cash back on all your other purchases. Earning cash back is not the primary reason to select a secured credit card, but it is a nice option to have available.

Free FICO Credit Score: Discover will provide you with a copy of your official FICO credit score. If you use a secured credit card properly, you should expect to see your score increase over time. And by providing your FICO score for free, you will be able to watch your improvement.

Monitor Your Social Security Number: Discover will monitor your Social Security Number and alert you if they find your Social Security Number on any of thousands of risky websites. Activate for FREE. This is a great feature that will help alert you of possible fraud.

You can learn more and apply by clicking on the link below:

A secured credit card is an excellent way to build or rebuild your credit history. In order to gain the most number of points in the shortest amount of time, you need to have a strategy. We recommend the following strategy (and describe how it helped someone build an excellent score in one year here):

  1. Avoid spending more than 10% – 15% of your available credit limit. Yes, that means if your credit limit is only $200, you should not spend more than $20 – $30 a month. Utilization is a very important part of your credit score. To calculate utilization, divide your statement balance by your available credit. People with the best credit scores have utilization well below 20%. Because you want to build an excellent credit score, you should keep your utilization low.
  2. Pay your statement balance on time and in full every month. To ensure your payments are made on time every month, you should consider automating the monthly payments. At the Discover website, you can sign up to have your monthly payment debited automatically from your checking account.
  3. Just continue to repeat Step #1 and Step #2. Your credit score should improve over time, which will help you qualify for a standard credit card.

If you have less than perfect credit and need to borrow money, you should consider shopping for a personal loan.

According to disclosures on the Discover website, you are eligible to apply if:

  • You are at least 18 years old.
  • You have a Social Security Number.
  • You have an address in the United States.
  • You have a bank account in the United States. Note: You will need to provide your routing number and account number when you apply. If your account is overdrawn, it is highly unlikely that you will be approved.

Your credit history will be reviewed, and not all applications will be approved. The card is best for those with no credit, or scores of 670 or less.

You can apply online and Discover usually provides a decision instantly. You will need to make your security deposit as part of the application, which is why Discover asks for the routing number and account number of your bank.

Please remember that when you apply for the secured credit card, you will have an inquiry on your credit report just like an application for a normal credit card.

Discover it has one of the strongest offerings in the market. However, it might not be right for everyone. Here are some other good options.

If you cannot afford the $200 minimum deposit, you should consider the Capital One Secured MasterCard. There is no annual fee and a minimum deposit of $49. You will also be able to receive your FICO score for free. Capital One is known for accepting people with more adverse credit histories. So, if you are rejected by Discover, you might want to consider trying Capital One instead.

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You should also consider a secured credit card from your local credit union. MagnifyMoney has a list of some of the best no fee secured credit cards offered by credit unions here.

Secured credit cards are a great way to build your credit score. And, with this product, Discover has created an excellent tool. Just make sure you don’t use your credit card to build a balance and borrow money. Keep your balance well below 20% of your available credit, and pay your statement balance on time and in full every month. If you do that, you should start to see real improvement in your score.

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Nick Clements is a writer at MagnifyMoney. You can email Nick at [email protected]

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Advertiser Disclosure: MagnifyMoney is an advertising-supported comparison service which receives compensation from some of the financial providers whose offers appear on our site. This compensation from our advertising partners may impact how and where products appear on the site (including for example, the order in which they appear). To provide more complete comparisons, the site features products from our partners as well as institutions which are not advertising partners. While we make an effort to include the best deals available to the general public, we make no warranty that such information represents all available products.

Ally CashBack Credit Card Review: Is it Worthwhile if You Don’t Bank with Ally?

Thursday, July 20, 2017

The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities.

Credit card at costco

Taylor K. Gordon is a freelance blogger and personal finance junkie who lives in the nation's capital.

Last year, Ally Bank rolled out the Ally CashBack Credit Card with a rewards program that offers 2% cash back on gas and groceries with no cap.

In addition to the cash back you earn from spending, Ally gives you a special 10% Ally Deposit Bonus when you deposit cash back earned into an eligible Ally Bank account.

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on Ally Financial’s secure website

In this Ally CashBack Credit Card review we’ll cover:

1. Earn up to 2.2% cash back at gas stations and grocery stores.

Factoring in the 10% Ally Deposit Bonus, you have the potential to earn a total of 2.2% cash back in the gas and groceries category.

You have to deposit cash back earned into a qualifying account to get the 10% bonus. Qualifying accounts include:

  • Ally Money Market accounts
  • Non-IRA Online Savings accounts
  • Interest Checking accounts

Fine print alert: Discount stores, superstores, and warehouses are not included in the groceries category. Stores like Target, Walmart, BJ’s, and Sam’s Club specifically may be off limits for 2% cash back.

Ally Bank qualifies your purchases for cash back using merchant codes. You can call up a store directly to see if it has a merchant code within one of these eligible 2% cash back categories:

Purchases outside of groceries and gas earn 1% cash back. You can earn a total of 1.1% if you add in the 10% Ally Deposit Bonus.

There’s an introductory bonus of $100 if you spend $500 within the first three months of having this card.

You can redeem cash back in two ways. As mentioned, you get the extra 10% bonus if you deposit cash back into an eligible Ally Bank account.

The second option is redeeming cash back for statement credit. You need to build a balance of at least $25 before you can redeem cash back.

You guessed it — we think the most attractive feature of the Ally CashBack Credit Card is the 10% Ally Deposit Bonus. We also like that this card has no spending cap for the 2% categories.

Other benefits are that there’s no annual fee and the interest rate range is reasonable.

The card even has a 0% APR introductory deal on balance transfers, although the 4% balance transfer fee is something to consider before moving your money.

One of the major drawbacks of this card is the merchant code restrictions.

Don’t get us wrong — the Ally CashBack Credit Card isn’t the only cash back rewards program that uses merchant codes to qualify purchases. Pretty much every niche category card has some fine print related to what you will and will not earn bonus cash back on.

Before shopping at a warehouse or specialty food store with this card (or any category card for that matter), double-check the merchant code to see if the purchase will be eligible for 2%.

One more spot where the Ally CashBack Credit Card has fine print is the program termination policy. If your account is canceled for any reason, by you or Ally Bank, you forfeit the cash back balance. Ally Bank also reserves the right to change terms or cancel the cash back program. If this occurs, you may give up your balance.

To avoid losing out on money, keep the card in good standing and cash out whenever you hit the $25 mark just in case Ally Bank should change terms in the future.

This card is best suited for current Ally Bank customers, but even people who bank with Ally should explore other options.

For non-Ally Bank customers, the 2.2% on gas and groceries is not worth opening two new accounts (the credit card account and a qualifying savings or checking account) to earn maximum cash back.

There are too many other category cards to consider ahead of this one that can give you more than 2.2% on gas and groceries.

There are even a few cards that offer you 2%+ cash back on all spending with no pesky category restrictions to keep up with.

We’ll share two alternatives with you in the next section.

But first, here’s an example to give you an idea of how much you can earn with the Ally CashBack Credit Card:

Say you spend $4,000 per year on groceries and $2,000 on gas. You can earn up to $132 in cash back for the year. (This includes the 10% Ally Deposit Bonus.)

Keep this scenario in mind because we’ll reference it next when reviewing a competitor.

For eligibility criteria, Ally Bank doesn’t get specific about the type of credit history or score you need to get approved.

However, some applicants have reported getting declined because of too many recent inquiries or new accounts. These are factors to be mindful of that could hurt your chances of getting approved.

We have a list of the top cash back cards for all categories in this post. Here are two alternative cards from that roundup to take a look at:

The Amex Blue Cash Preferred card is one of our top picks for gas and grocery shopping rewards. This card gives you a huge 6% cash back at U.S. supermarkets (up to $6,000 in spending a year) and 3% cash back at U.S. gas stations and at select U.S. department stores. You get 1% cash back on all other purchases. The Amex Blue Cash Preferred card has a $95 annual fee.

Back to our example scenario from above:

If you spend $4,000 annually on groceries and $2,000 annually on gas, you earn $300 in total cash back from the Amex Blue Cash Preferred. Subtract the $95 annual fee, and you still net $205 in cash back. Remember — the Ally CashBack Credit Card only gives you up to $132 in this same spending scenario. The moral of the story is, rewards cards that have an annual fee can still outperform cards with no annual fee. So don’t let a fee deter you from reviewing an offer.

If you do most of your shopping at wholesale stores or you prefer a non-category card, the Alliant Visa Signature card is another option we recommend. The Alliant Visa Signature card gives you an unlimited 3% cash back for the first year with no fee. After the first year, you earn 2.5% cash back on all purchases with a $59 annual fee. If your spending is all over the map, an unlimited cash back card like the Alliant Visa Signature can give you more flexibility than the Ally CashBack Credit Card.

No, Ally cash back does not expire as long as your account remains open and in good standing. There is no limit to the amount of cash back rewards that may be earned.

Anything over 1.5% cashback is a good deal. There are some cards that offer more — as much as 5 or 6% cash back on purchases. But sometimes those offers are too good to be true. Banks don’t like to lose money, and will pepper the fine print with all sorts of limitations. For example, they may offer 5% cash back on only purchases at certain types of retailers and only for certain periods of time. And those categories may change every quarter, which can make it hard to keep track.

What happens if I can’t pay my credit card bill in full?

Don’t let those cash back promises pressure you into spending more than you can afford. If you don’t pay your statement balance in full each month, you could get slapped with sky high interest charges. That would totally negate any benefit you might get from earning cash back. Cash back cards are only valuable if you can pay your bill in full and capture the entirety of your cash back rewards.

It depends on the card. Some cards allow you redeem cash back dollar for dollar as a statement credit, which can help lower your total balance. Just keep in mind that applying cash back to your card statement does not count as a monthly payment. Other cards will increase the value of your cash back if you spend on certain categories, like travel. Review your terms carefully to be sure you’re getting the most bang for your buck.

Find the card that fits your day-to-day spending needs best, beyond the flashy sign-up bonus offers and cash back promises. Pay your bill in full each month (spend only what you can afford to pay off).

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Taylor Gordon is a writer at MagnifyMoney. You can email Taylor at [email protected]

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Advertiser Disclosure: MagnifyMoney is an advertising-supported comparison service which receives compensation from some of the financial providers whose offers appear on our site. This compensation from our advertising partners may impact how and where products appear on the site (including for example, the order in which they appear). To provide more complete comparisons, the site features products from our partners as well as institutions which are not advertising partners. While we make an effort to include the best deals available to the general public, we make no warranty that such information represents all available products.

Alliant Cashback Visa Signature Review: 2.5% Unlimited Cash Back

Thursday, July 20, 2017

The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities.

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Taylor K. Gordon is a freelance blogger and personal finance junkie who lives in the nation's capital.

Few credit cards offer unlimited 2.5% cash back on all spending without caps or complicated category restrictions. Alliant Credit Union recently rolled out its Cashback Visa Signature Card, which may very well be the “holy grail” of unlimited cash back cards.

The Alliant Cashback Visa Signature Card gives cardholders 3% cash back the first year and 2.5% back subsequent years. This card does have an annual fee, but the fee is waived for the first 12 months.

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on Alliant CU’s secure website

How the Alliant Cashback Visa Signature Card works

Alliant Credit Union is an online credit union that anyone can join. If you don’t meet the standard credit union qualifying criteria (being a relative of a member or working for a select organization), you can join by making a $10 donation to Foster Care to Success.

If you choose to apply for this card, be sure to swipe it as much as possible during the first year to make the most of the free 3% cash back. This is a great deal.

The annual fee after the first year is $59. Aside from the annual fee, the Alliant Cashback Visa Signature Card has extra costs within the card terms that are pretty typical of any credit card.

Most notably, there’s a 3% balance transfer fee and no foreign transaction fee.

You can redeem cash back earned through statement credit when your cash back balance reaches $25. Cash back expires after five years. Cash back also expires if your credit card account is closed voluntarily or involuntarily.

We highly recommend the Alliant Cashback Visa Signature Card if you hate keeping up with revolving category cards. Category rules can be a pain. This card makes earning cash back painless.

On the other hand, if you’re someone who likes using category cards (airline, grocery, gas, etc.), this card also partners nicely with others. Keep it in your wallet to maximize rewards in areas that your category cards don’t cover.

Alliant Credit Union has very lenient member-qualifying criteria, so non-members can join today. If you already have an Alliant Credit Union card, call credit card services to request an upgrade.

Cardholders report that you can get approved with a score in the high 600s, although credit card services states qualification is based on more than just your credit score.

For example, you may qualify for this card with less-than-perfect credit if your income is high. Since this is a Visa Signature card, credit limits are higher than traditional cards, and that requires having enough income to support a good-sized limit.

What we like about the Alliant Cashback Visa Signature Card

We like this card a lot because it’s one of few credit cards that give you 2% cash back without a long list of rules on what you can and can’t buy.

Until now, the Citi Double Cash card has been our top recommendation for no-fuss 2% cash back on all spending. However, the Alliant Cashback Visa Signature Card is giving the Citi Double Cash card some stiff competition.

The 3% cash back without an annual fee the first year is very hard to beat. And if you spend at least $1,000 per month on the card after year one, 2.5% cash back with the annual fee still outperforms the Citi Double Cash card.

We’ll discuss why the magic number for spending is $1,000 in our credit card comparison below.

What we don’t like about the Alliant Cashback Visa Signature Card

There’s not too much to discuss that’s negative about this card. The one thing to be mindful of is that it does not have an interest-free intro deal on new purchases or balance transfers.

This means you shouldn’t take out this card intending to go on a crazy shopping spree or to finance big life events like a wedding, relocating, or traveling unless there’s a repayment plan in the strategy.

You’ll get a great deal of cash back from large purchases the first 12 months, but you need to pay off the balance promptly to avoid many interest charges.

We started out this post mentioning that there aren’t too many unlimited 2%+ cash back cards available, so let’s dive into the three main alternatives:

  • Citi Double Cash
  • Fidelity Rewards Visa Signature
  • USAA Limitless Cashback Rewards Visa Signature

The Citi Double Cash card is usually our “go-to” pick for unlimited 2% cash back with no category restrictions.

The Alliant Cashback Visa Signature Card clearly has the Citi Double Cash card beat in the first year. Things get a little less clear-cut when the Alliant Cashback Visa Signature Card starts costing $59 annually.

As mentioned, when taking the fee into consideration, you need to spend over $1,000 per month on the Alliant Cashback Visa Signature Card to earn more from it than the Citi Double Cash card.

Here’s the calculation breakdown:

The more you spend beyond $12,000 per year, the more the Alliant Cashback Visa Signature Card outperforms the Citi Double Cash card.

The Fidelity Rewards Visa Signature card is another 2% cash back option with no fee, but this card comes with conditions. You can only earn 2% cash back when you direct deposit rewards into a Fidelity Investment account.

This is still a decent deal for Fidelity Investment customers. If you plan to spend less than $12,000 per year on your rewards card, consider this one or the Citi Double Cash card.

Lastly, the Limitless Cashback Rewards Visa Signature card from USAA offers an unlimited 2.5% cash back with no annual fee. This card also has restrictions.

You have to keep a certain amount of cash in a connected USAA checking account to qualify for 2.5% cash back. Plus, the card is only made available to select USAA members who live in Alabama, Arkansas, Arizona, Colorado, Connecticut, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Kansas, Louisiana, Maryland, Michigan, Minnesota, Montana, North Dakota, New Mexico, Nevada, New York, Oregon, Pennsylvania, Rhode Island, South Carolina, Tennessee, Texas, and Washington.

In comparison to these cards, the Alliant Cashback Visa Signature card is a rare bird with its over 2%+ cash back program and very limited fine print.

Yes, the Alliant cash back rewards expire after 5 years, and you also forfeit your unused rewards if you close your account. It’s important to note that cash back doesn’t expire exactly 5 years from the date you earn it. Cash back rewards expire on a rolling, annual basis; cash back earned in a calendar year will expire on the December cycle date of the fourth calendar year in which it was earned. For example, any unredeemed cash back earned in 2017 will expire on the December cycle date in 2021.

Anything over 1.5% cashback is a good deal. There are some cards that offer more — as much as 5 or 6% cash back on purchases. But sometimes those offers are too good to be true. Banks don’t like to lose money, and will pepper the fine print with all sorts of limitations. For example, they may offer 5% cash back on only purchases at certain types of retailers and only for certain periods of time. And those categories may change every quarter, which can make it hard to keep track.

What happens if I can’t pay my credit card bill in full?

Don’t let those cash back promises pressure you into spending more than you can afford. If you don’t pay your statement balance in full each month, you could get slapped with sky high interest charges. That would totally negate any benefit you might get from earning cash back. Cash back cards are only valuable if you can pay your bill in full and capture the entirety of your cash back rewards.

It depends on the card. Some cards allow you redeem cash back dollar for dollar as a statement credit, which can help lower your total balance. Just keep in mind that applying cash back to your card statement does not count as a monthly payment. Other cards will increase the value of your cash back if you spend on certain categories, like travel. Review your terms carefully to be sure you’re getting the most bang for your buck.

Find the card that fits your day-to-day spending needs best, beyond the flashy sign-up bonus offers and cash back promises. Pay your bill in full each month (spend only what you can afford to pay off).

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Taylor Gordon is a writer at MagnifyMoney. You can email Taylor at [email protected]

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Advertiser Disclosure: MagnifyMoney is an advertising-supported comparison service which receives compensation from some of the financial providers whose offers appear on our site. This compensation from our advertising partners may impact how and where products appear on the site (including for example, the order in which they appear). To provide more complete comparisons, the site features products from our partners as well as institutions which are not advertising partners. While we make an effort to include the best deals available to the general public, we make no warranty that such information represents all available products.

Thursday, July 20, 2017

The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities.

Credit card at costco

Taylor K. Gordon is a freelance blogger and personal finance junkie who lives in the nation's capital.

If you’re on the hunt for a new rewards card, you’ve probably come across the Chase Freedom card during your search. The Chase Freedom card offers 1% cash back on all purchases and the opportunity to earn additional cash back if you spend money within revolving quarterly bonus categories.

on Chase’s secure website

® " data-cat-name="CreditCards" data-brand="Chase" data-variant="Cashback" data-cardname="Direct2Bank" data-url="chase-freedom-review805263733" class="linkTrackingWidget" rel="nofollow" target="_blank">Chase Freedom ®

In this post, we’re going to review the Chase Freedom credit card details, including:

You automatically earn 1% cash back on all purchases as soon as you start using the card.

Every quarter, Chase introduces bonus categories where you can earn 5% cash back. In order to earn 5%, you need to activate the bonus category every quarter. If you don’t activate, you will only earn at the 1% cash back rate. You can only earn 5% cash back on up to $1,500 of spending every quarter.

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Here are the current 5% bonus categories for 2017:

The bonus categories for October will be announced in September.

Since you may have to wait several months for the holiday bonus category to be announced for 2017, here’s a look at the 5% categories for 2016 as a reference of what could be to come:

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Keep in mind, the quarters can change annually, so the summer and fall categories for 2016 may not be the same for 2017. Although one thing you can be pretty sure of is the last quarter of the year will be a category that’s holiday shopping friendly. We’ll update cash back categories for 2017 when they’re announced.

How to Activate the Quarterly 5% Cash Back Categories

Now that you know the type of spending that will earn you 5% cash back, let’s touch on how it all works.

To earn 5% cash back each quarter, you must activate the quarterly bonus categories before the deadline. The activation deadline appears on the cash back calendar.

There are six easy ways to activate. Just choose the one that’s best for you.

  1. Online – Once you are a Chase Freedom cardholder, you can activate online at the Ultimate Rewards portal.
  2. Text message – Sign up for Chase Freedom 5% text reminders at online. You’ll get a text reminding you when it’s time to activate.
  3. Email – You can also sign up for email reminders from Chase.
  4. Phone – Call the number on the back of your card to let one of the specialists activate your 5% cash back.
  5. Chase location – Visit any Chase Bank and see a personal banker.
  6. ATM – Chase checking customers can activate their 5% cash back with one click via the ATM while making a cash withdrawal.

The base 1% cash back will always apply first to purchases on your statement. Each quarter you activate, spending that qualifies for an extra 4% cash back will appear in a separate section broken down by category.

It’s hard to beat 5% back on spending you’re already doing, and if you pay attention and enroll in the categories every quarter, you can earn up to $300 in cash back a year compared to the base 1% cash back you earn on all purchases.

Chase comes up with fresh categories that sometimes include tie-ins with big retailers like Amazon so it’s not hard to find a way to earn 5% on your spending throughout the year.

If you have another card that earns Ultimate Rewards points, like the Chase Sapphire Preferred, you can combine the rewards you earn from the Freedom with your other Ultimate Rewards points anytime.

There’s no automatic enrollment in the 5% categories, so you need to remember to take care of that every quarter. Chase lets you sign up for alerts so it’s not hard to get reminded, and you can enroll right from your phone. This is a card for maximizers, not people who want to set it and forget it.

You only earn 5% back on up to $1,500 worth of spending in the designated categories each quarter. That’s $1,500 total across all the categories, not $1,500 for each category.

Right off the bat, you can probably tell a card with changing quarterly categories like the Chase Freedom card isn’t for the passive cash back rewards earner. There’s a lot involved here.

You need to activate the 5% cash back bonus each quarter. The cash back categories can change each year. And you must be a mindful spender who remembers when to swipe the Chase Freedom card to earn 5% back.

There’s a fair amount of fine print that dictates what will and won’t qualify for 5% cash back. As the new categories roll out, you’ll want to pay close attention to the type of purchases that are eligible.

A noticeable category from 2016 that’s not yet on the 2017 calendar is wholesale clubs. The category may be included later, but it’s a notable exclusion that may impact wholesale club shoppers who previously relied on the Chase Freedom card for cash back on that spending.

The Chase Freedom card is part of the Chase Ultimate Rewards program, so the Ultimate Rewards portal is where you go to manage and redeem points. Cash back earned from the Chase Freedom card is tracked in Ultimate Rewards points – $1 in cash back equals 100 points.

When you redeem points for rewards, for the most part, 100 points also equals $1 (and 1 point equals $0.01).

The true value of points earned varies slightly. Here’s the breakdown:

Statement credit or cash deposit redemption: 100 points = $1

Travel redemption: 100 points = $1; you can use a combination of points and your credit card for bookings

Amazon product redemption: Below is a sample conversion, but it’s subject to change

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If you do choose the Chase Freedom card, make sure to redeem your points in a way that you’ll get the most value. Choosing Amazon products may not be the way to go.

Combine with a Chase Sapphire Credit Card

If you have a Chase Sapphire Preferred or Chase Sapphire Reserve credit card, you can combine your Freedom Ultimate Rewards points with your Sapphire Ultimate Rewards points. That means you would have all of the redemption opportunities associated with the popular Sapphire cards, including the ability to transfer your points to frequent flier programs like United and Southwest.

You need to have good or excellent credit in order to be approved for the credit card. In addition to having a good credit score, Chase will consider your employment status and income to ensure that you would be able to afford any new debt.

For benefits and protections, the Chase Freedom card offers:

  • Zero liability protection means you won’t be held responsible for unauthorized charges made with your card or account information. This is a fairly common credit card benefit.
  • Chip-enabled card. Just one warning: this is a chip and signature card (and not a chip and pin card). While that should be fine for all of your spending in America, it might make using the card overseas a bit more difficult when only chip-and-pin is accepted.
  • Purchase protection covers your new purchases for 120 days against damage or theft up to $500 per claim and $50,000 per account.
  • Price protection provides that if a card purchase you made in the U.S. is advertised for less in print or online within 90 days, you can be reimbursed the difference up to $500 per item, $2,500 per year.
  • Auto rental collision damage waiver means you can decline the rental company’s collision insurance and charge the entire rental cost to your card. Coverage is provided for theft and collision damage for most cars in the U.S. and abroad. In the U.S., coverage is secondary to your personal insurance.

How does Chase Freedom stack up versus the competition? It really depends upon how you use your card. 5% cash back is one of the highest rates on the market, but you need to activate and spend in that category to earn rewards. Otherwise you would be earning a not very exciting 1%.

We will now compare Chase Freedom to three other types of cash back credit cards:

  • Discover it – a credit card that offers rich cash back rewards
  • Flat rate cash back credit cards, where you can earn 2%
  • Bonus category cards

There are a lot of similarities between Discover it and Chase Freedom. Both cards have no annual fee and pay a base cash back rate of 1%. Both cards offer 5% cash back in rotating categories. Both cards require you to opt in to the 5% cash back categories and cap the 5% cash back to the first $1,500 of spend. But there are two areas where these cards are different.

The first big difference is the intro bonus. With Chase Freedom, you can earn $150 after spending $500 in the first 90 days. Discover, on the other hand, will match all of the cash back that you earned during the first year – at the end of your first year as a new cardmember. There is no cap to the sign-on bonus. If you are a big spender (especially in the bonus categories), you would earn much more during Year 1 with Discover. Here is a comparison of first year earnings:

  • You spend $1,000 a month in 1% categories
  • You spend $500 a month in 5% categories
  • The sign-on bonus at Chase would be $150
  • The sign-on bonus at Discover, at the end of the first year, would be $420

While you get the intro bonus much quicker at Chase – for big spenders, it pays to wait until the end of Year 1 at Discover.

The second big difference is the categories. Each quarter Discover and Chase announce their bonus categories, and they can be different. At Discover, the 5% category until September 2017 is restaurants.

If you are a big spender, the Discover it first year bonus makes it a good choice. If you are constantly looking for good deals, having both cards in your wallet to take advantage of the bonus categories might be a good choice.

If opting into bonus categories every month sounds painful, you might want to consider a card that pays a flat rate on all of your spending. Whereas Chase Freedom offers a combination of 5% on bonus categories and 1% on everything else – you can get 2% flat cash back with some credit cards.

Citi Double Cash pays 1% cash back as you spend and 1% cash back as you pay your bill. If you pay your statement balance in full every month and claim the cash back as a check or deposit into your checking account, you can earn double cash back.

Another new option is from Alliant, a credit union that anyone can join. With the Alliant Cashback Visa Signature card, you can earn 3% cash back during the first year (with no annual fee) and then 2.5% cash back thereafter. Just be warned: after the first year, there is a $59 annual fee. If you spend more than $1,000 a month on the card, the Alliant card will be a better deal than Citi Double Cash.

If you spend a lot of money in a single category every month, you might want to consider a credit card that pays a higher rate on just that category. For example, if you spend a lot of money on gas, you can find a card that pays 5% cash back on gas. If groceries are your biggest expense, you can find a card with 6% on groceries. You can find the best cash back credit cards by category here.

Cash back credit cards are great ways to put a little extra money in your pocket. Just remember to pay the statement balance in full and on time every month. Interest and late fees can quickly eat away at the cash back that you earn.

Chase Freedom is a good choice for people who are willing to opt in to the bonus categories each quarter and actually spend a lot of money in the bonus categories. If you don’t take advantage of the generous 5% bonus categories, you will be left with a card paying only 1%, which is not very exciting.

The Ultimate Rewards points you earn from the Freedom don’t expire as long as you keep the account open. If you close your account, you will forfeit your points, though if you keep another Chase card that earns Ultimate Rewards open you can transfer your points to that account before you close your Freedom, and keep them alive.

How do you know a purchase will fall in a 5% category?

Credit card companies rely on merchant codes provided by payment networks to determine the category of a purchase. Some stores might have a merchant code that doesn’t fit what you might think the purchase will be. For example, buying groceries at a Walmart isn’t a grocery purchase because Walmart doesn’t code itself as a grocery store. There’s no way to know for sure in advance what category a merchant falls under, so be aware of that before relying on the cash back for a category from a merchant you haven’t shopped at before.

What happens if I can’t pay my credit card bill in full?

Don’t let those cash back promises pressure you into spending more than you can afford. If you don’t pay your statement balance in full each month, you could get slapped with sky-high interest charges. That would totally negate any benefit you might get from earning cash back. Cash back cards are only valuable if you can pay your bill in full and capture the entirety of your cash back rewards.

It depends on the card. Some cards allow you redeem cash back dollar for dollar as a statement credit, which can help lower your total balance. Just keep in mind that applying cash back to your card statement does not count as a monthly payment. Other cards will increase the value of your cash back if you spend on certain categories, like travel. Review your terms carefully to be sure you’re getting the most bang for your buck.

Find the card that fits your day-to-day spending needs best, beyond the flashy sign-up bonus offers and cash back promises. Pay your bill in full each month (spend only what you can afford to pay off).

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Taylor Gordon is a writer at MagnifyMoney. You can email Taylor at [email protected]

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This Cash Back Number May Surprise You

Advertiser Disclosure: MagnifyMoney is an advertising-supported comparison service which receives compensation from some of the financial providers whose offers appear on our site. This compensation from our advertising partners may impact how and where products appear on the site (including for example, the order in which they appear). To provide more complete comparisons, the site features products from our partners as well as institutions which are not advertising partners. While we make an effort to include the best deals available to the general public, we make no warranty that such information represents all available products.

Thursday, July 20, 2017

The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities.

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Brittney Laryea is a personal finance reporter for MagnifyMoney. She graduated from the University of Georgia's Grady College of Journalism and Mass Communication and lives in Brooklyn, N.Y.

Citi Double Cash offers the highest no-fee flat-rate cash back credit card on the market. If you pay your balance in full and on time every month, you can earn up to double cash back on everything you spend. You earn 1% cash back when you spend, and then 1% cash back when you pay. If you pay your statement balance in full and deposit the cash back into your checking account, you will have earned a nice 2%.

There is no cap on the cash back you can earn, and there are no rotating categories or requirements to opt into every quarter. If you are looking to earn a lot of cash back without a lot of work, this card could be right for you.

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on Citibank’s secure website

To get double cash back, you must emulate the habits of the savviest credit card holders: use your card, and pay it off in full each month. Do anything else, and you won’t get the full benefit of the double cash back reward.

With the Citi Double Cash Card, you receive your first 1% when you purchase something, but Citi holds onto the second 1% cash back reward until you pay them back. So you get 1% cash back for every dollar you spend, and another 1% cash back for each dollar you pay off on your balance — on time — each month.

To get the maximum double cash back quickly, you should pay off your entire balance. However, as long as you pay the minimum each month, you’ll eventually receive the double cash back, although you’ll pay a lot more than 1% in interest each month.

When your balance reaches $25, you can choose to redeem your cash reward through a gift card, check, direct deposit, or statement credit to your Citi account. Beware: if you redeem with a statement credit, you won’t get exactly double cash back, but just shy of it depending on the size of the reward.

If you redeem via gift card, you’ll select from retail, restaurant, entertainment, and electronic gift cards in Citi’s gift card marketplace. Choosing the direct deposit option will allow you to transfer your cash back directly to your bank account whether it’s a Citi account or not. If you redeem via check, you should receive a paper check at the address you have on file in 7 to 10 business days.

You can also redeem with a statement credit, but you might notice you don’t get quite double cash back. Since a $25 credit on your statement reduces the amount you’d need to pay back by some amount, you technically get a little less than 2% cash back.

For example, if you redeem $1,000 in cash back for the year, you’ll be shorted about $10 if you redeem your rewards with a statement credit. Assuming you paid off your balance each month, your cash back is reduced to about 1.98%. If you don’t want to miss out on that gap, redeem via check or direct deposit. Also, remember Citi does not count a statement credit as a payment, so you still need to make at least your minimum monthly payment by the due date or you’ll be charged a late fee.

For more details on how to get your cash back, check out this article, where we show you step-by-step how to redeem your cash back with Citi.

Disclaimer: Your rewards will expire if you don’t use your card for 12 months, so be sure to swipe at lease once a year, or redeem your cash before it expires.

Borrowers with good or excellent credit scores are likely to get approved for the Citi Double Cash Card. That means you can still get approved with a few marks on your credit report. That’s unusual as rewards cards with a 0% introductory balance transfer offer like the Citi Double Cash Card are rare for those who lack excellent credit.

The Citi Double Cash Card offers the following benefits and protections to cardholders:

  • No penalty for your first missed payment. Citi won’t charge you a late fee on a first missed payment. This benefit forgives those who usually pay on time, but may miss a payment by accident. Careful, you WILL be charged a fee if you miss a second payment.
  • Citi Private Pass. Citi customers get special access to purchase presale tickets and VIP packages to events such as concerts, sporting events, dining experiences, and complimentary movie screenings.
  • Citi Price Rewind. If you notice a price drop on the big-ticket item you just bought, Citi may have already refunded you the difference. Citi Price Rewind will look for a lower price on any registered items you purchase for 60 days. If the system finds a lower price, you may be refunded the difference.
  • Chip-enabled card. Just one warning: this is a chip and signature card (and not a chip and pin card). While that should be fine for all of your spending in America, it might make using the card overseas a bit more difficult when only chip-and-pin is accepted.
  • Citi Concierge. Citi Concierge sets you up with trained experts to help you plan your travel, shopping, dining, entertainment, and other parts of your next trip.
  • Protection against interrupted trips. If your travel plans are interrupted for some reason, Citi will reimburse you for part of your hassle. The bank will reimburse any nonrefundable travel expenses such as change fees if you paid for the ticket with your Citi Double Cash Card.
  • Car rental and collision insurance. You can skip paying extra for the rental company’s collision loss and damage insurance if you use your Citi Double Cash Card. Citi will cover you against any theft or damage done to the rental as long as you used your Citi card to pay for it.
  • Zero liability protection. You won’t be held responsible for unauthorized charges made with your card or account information. This is a fairly common credit card benefit.
  • Purchase protection covers repairs or refunds for your new purchases in case of damage or theft within 120 days of your making the purchase.
  • Lost wallet service. If you happen to lose your wallet and everything in it, take some comfort in knowing your Citi card, at least, will be replaced within 24 hours. Citi can also give you emergency cash up to your available cash advance limit to help out between losing your card and receiving a new one.

It has the highest no-fee flat rate reward in the market.

The clearest advantage of the Citi Double Cash Card is that it offers the highest flat rate cash rewards program without an annual fee on the market. The card’s double cash back feature can be a valuable feature for those known to make most everyday purchases on a credit card, and pay the card balance off each month.

The flat rate on all purchases keeps earning rewards simple.

If you like things simple, the card’s flat rate on everything will make keeping up with rewards a breeze. You’ll earn 1% on everything you buy, so there won’t be any need for you to fumble through a stack of credit cards for a specific cash back card at the grocery store. It also eliminates stressing over when or by how much rewards categories might change on your current go-to card each quarter.

The card’s 18-month introductory 0% balance transfer offer makes it a good choice for those seeking to consolidate debt, too. The cash back rewards won’t apply to your balance transfer, but you’ll get 18 billing cycles to pay off the balance interest-free before the card’s higher ongoing interest rate kicks in.

The Citi Double Cash Card’s other benefits aren’t bad either. The card also grants you free access to view your Equifax FICO® Score, and the Citi Price Rewind benefit automatically reimburses you the difference on purchases made with your card if the price changes within 60 days.

What to watch out for with the Citi Double Cash Card

You have to pay off your balance in full to reap the full reward.

You could pay the minimum each month and eventually see you’ve redeemed your cash back. However, the reward really only benefits you if you pay your balance in full each month. If you don’t, the full interest you’ll be charged on your purchases will eclipse the double cash back benefit.

Although the balance transfer isn’t the main perk the card has, it’s important to note Citi charges you a 3% fee to transfer your balance. Granted, the charge isn’t much compared to the 16% on average you’d be charged in interest on your balance each month if you don’t transfer, but there are many, no-fee balance transfer alternatives (like the Discover it or Chase Slate cards) you could qualify for instead.

You’ll pay to use this card overseas, and the fee isn’t worth it if you can avoid doing so. The 3% foreign transaction fee you’ll be charged to swipe makes the potential double cash back you’d receive on the purchase trivial.

With the Citi Double Cash Card, you won’t get a sign-on bonus like you’d get with other competing cash back cards like Fidelity’s Rewards Visa Signature ($100) or the Capital One Quicksilver card. It’s not a huge pitfall among the card’s best-in-class cash back offer and other perks, but it’s something to consider when weighing your options.

Take care to redeem your cash back before you stop using the card! If you don’t earn cash back on rewards with your Citi Double Cash Card for 12 months, your rewards will expire. If you plan to stop using the card — maybe you accepted the offer for a specific purchase, or simply for the balance transfer offer — make sure to redeem your cash back before adding it to your credit card graveyard.

The Citi Double Cash Card has the highest no-fee flat rate cash back reward on the market, but it might not be the best cash back card for you, depending on your spending habits.

Cards that only earn cash back in certain categories, for example, may work better for you. You might find you spend most of your income in a category such as groceries or gas, so you’d earn a greater reward with a card that earns cash back only in specific spending categories or enjoy keeping up with rotating categories.

Next we compare how the Citi Double Cash Card compares to four other cash back credit cards:

  • Fidelity’s Rewards Visa Signature – the other 2% cash back credit card
  • Alliant Cashback Visa Signature – the 2.5%-3% cash back credit card with a fee
  • Chase Freedom — the rotating category alternative
  • Blue Cash Preferred Card from American Express — the bonus category alternative

Fidelity’s Rewards Visa Signature card earns cardholders 2% cash back on all purchases with no annual fee. The card is best for existing Fidelity customers, as the funds you earn must be deposited into a Fidelity account.

Borrowers with “good” credit need not apply for this card. Your credit score has to be above 700 to get approved for a line of credit with the Fidelity Visa. Even then, you may be disappointed if you’re not a big Fidelity customer as Fidelity bases its credit limits on the total amount of assets it’s managing on your behalf.

If you don’t mind paying an annual fee, the Alliant Cashback Visa Signature card could be a viable alternative to the Citi Double Cash Card.

Alliant’s Cashback Visa Signature card offers an unlimited 3% on all purchases in the first year and 2.5% cash back on all purchases in the years following. You’ll also forgo a foreign transaction fee if you use the card overseas. The catch is, cardholders pay a $59 annual fee to hold the card. Only those with excellent credit and high income will qualify for this rewards offer.

With Chase Freedom, you’ll automatically earn 1% back on all purchases, 5% on purchases you make in the categories you’ve activated. The card also offers a $150 signing bonus when you spend $500 on purchases in the first three months the account is open.

The Chase Freedom card rotates rewards categories each quarter, so you’ll need to look out for changes and opt in to the quarter’s categories before you can start earning rewards in them. You also won’t be charged interest on purchases or balance transfers made in the first 15 months. You can also earn a $25 bonus when you add an authorized user and make your first purchase within the first three months.

If you qualify for the Citi Double Cash Back Card, you have a good chance of qualifying for Chase Freedom, too. Borrowers with good or excellent credit scores have the best shot at getting approved for the Chase Freedom card.

Blue Cash Preferred Card from American Express — the bonus category alternative

With a card like the Blue Cash Preferred Card from American Express, you’ll earn a larger amount of cash back in certain categories. The card awards holders 6% cash back at U.S. supermarkets, on up to $6,000 worth of spending. You also get 3% cash back at U.S. gas stations and select U.S. department stores. So, if your household spends big on gas and groceries, the rewards you’d earn with a card like the Blue Cash Preferred Card will likely be greater that what you could earn with the Citi Double Cash Card.

Try using this tool to figure out which cash back card has the best ongoing program for your needs. Fill in how much you tend to spend each month in each spending category, and the system will generate recommendations based on your spending habits.

Who benefits the most from the Citi Double Cash Card

Overall, cash back cards can be a great way to put some extra money in your pocket, as long as you remember to pay your statement balance in full each month. Interest and late fees can eclipse your cash back earnings pretty quickly.

The Citi Double Cash Card is best for borrowers with good or excellent credit, who make everyday purchases with a credit card and have great payment habits. The double cash back feature is great if you already have the discipline to pay your statement balances off in full each month, and it’s the only way the card’s reward offer is valuable. If you don’t think you can consistently pay off your card each month, it’s best to get the habit set in stone before trying a rewards credit card.

If you’ve never had a rewards card, the Citi Double Cash Card’s simple terms and flat rate cash back rewards make for a great starter rewards card and — so long as you pay your balance off each month — it can be a great way to earn extra pocket change without going into debt.

You’ll get up to double cash back on all of your purchases, which is the logic behind advertising the card as “Double Cash” and not “2% Cash.” You’ll earn your first 1% on all purchases, then another 1% when you pay off the purchase, but if you choose to redeem your cash back via statement credit on your account, you’re technically getting just shy of 2% cash back.

Yes, the cash back on the Citi Double Cash expires if you haven’t used your card for 12 months.

Anything over 1.5% cash back is a good deal. There are some cards that offer more — as much as 5% or 6% cash back on purchases. But sometimes those offers are too good to be true. Banks don’t like to lose money and will pepper the fine print with all sorts of limitations. For example, they may offer 5% cash back on only purchases at certain types of retailers and only for certain periods of time. And those categories may change every quarter, which can make it hard to keep track.

What happens if I can’t pay my credit card bill in full?

Don’t let those cash back promises pressure you into spending more than you can afford. If you don’t pay your statement balance in full each month, you could get slapped with sky-high interest charges. That would totally negate any benefit you might get from earning cash back. Cash back cards are only valuable if you can pay your bill in full and capture the entirety of your cash back rewards.

It depends on the card. Some cards allow you to redeem cash back dollar for dollar as a statement credit, which can help lower your total balance. Just keep in mind that applying cash back to your card statement does not count as a monthly payment. Other cards will increase the value of your cash back if you spend on certain categories, like travel. Review your terms carefully to be sure you’re getting the most bang for your buck.

Find the card that fits your day-to-day spending needs best, beyond the flashy sign-up bonus offers and cash back promises. Pay your bill in full each month (spend only what you can afford to pay off).

Credit card at costco

Brittney Laryea is a writer at MagnifyMoney. You can email Brittney at [email protected]

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Credit card at costco

This Cash Back Number May Surprise You

Advertiser Disclosure: MagnifyMoney is an advertising-supported comparison service which receives compensation from some of the financial providers whose offers appear on our site. This compensation from our advertising partners may impact how and where products appear on the site (including for example, the order in which they appear). To provide more complete comparisons, the site features products from our partners as well as institutions which are not advertising partners. While we make an effort to include the best deals available to the general public, we make no warranty that such information represents all available products.

Best Rewards Credit Cards: Double miles, 5% cash, and more

Friday, January 20, 2017

The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities.

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Nick Clements has worked in consumer banking for nearly 15 years and is the co-founder of MagnifyMoney.

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