The Executive membership gives us a 2% reward on pretax purchases at Costco warehouses. It does not include purchases of Costco cash cards or gas, something I was unaware of until I read the fine print on the back of the check. This means we spent around $5,450 on non gas and non cash card purchases. That’s a LOT of meat!!
In a previous post I wrote about buying Costco Cash Cards online in order to get United miles. This still makes perfect sense, if you aren’t an Executive member. But do I want to forego the 2% cash reward for the miles?
If I continue to pay almost exclusively with Cash Cards I buy online, our reward checks going forward would be greatly reduced – certainly below $55 and probably closer to $10 or less. And, in order to justify the Executive membership, which costs $55 more than the Gold membership, our reward check has to be more than $55.
If I decide to forego the 2% cash reward in favor of United miles, I will continue to buy Cash Cards online and I will downgrade our membership from Executive to Gold. The Gold membership costs $55/year (up from $50/yr). If I decide I’d rather have the 2% cash reward I won’t downgrade my membership and I will only buy Cash Cards for our gas purchases, which don’t count towards the cash reward, anyway. In this scenario, if and when our cash reward dips below $55, I will downgrade. (Update: see comment from Andrew below. He says you are guaranteed a minimum rewards check from Costco of $55.)
What to do? What to do?
I think I will hold on to our Executive membership. I value money over miles and, in this situation, it’s 2%. Plus, it’s easier to keep using our Costco American Express than trying to keep enough Cash Cards handy to cover all our purchases.