hank - Share : One of my biggest pet peeves about Costco is how they stick to the American Express credit card only. I am a big fan of using my credit card and saving the Alaska Air Skymiles. I don’t own an American Express card and always have to resort to losing AT LEAST 200 Alaska Air Skymiles (I don’t remember the last time I made it out for under $200). But I believe I have figured out the answer that will solve ALL our dreams. Well, all that involve being able to get Skymiles while not AMEX’ing it…
Yes, I can’t stand not getting the best bang for my buck, so it pains me every time I walk into Costco to know that I’m going to walk out with at least $200 of groceries (my record is $645, ugh) and have nothing to show for it aside from a debit transaction on my bank statement.
I don’t charge ANYTHING to that debit card but Costco and my mortgage (if you know how to add your mortgage to a credit card, please let me know as I’d do that too if I could).
I always leave the conglomerate with a sense that I wasn’t getting as good of a deal from them as I had in the past. Part of me believes that they’ve suckered people in to thinking that bigger means better value ALL the time.
It DID back when Costco first started, and you could get a good deal on anything there, but anymore, you get just as good of a deal at Safeway or Fred Meyer for groceries as you do from Costco, you just get MORE of them there, but I digress.
So last week my wife was being a good samaritan and helped out a friend that was going through some hard times by providing some groceries and necessities to her family in the form of a Costco gift card. You can get them for no “sales” fees, no “hidden” costs, no “transaction” fees. It actually means that when you buy a $300 gift card, you get charged $300 (click to enlarge).
This is different from the AMEX gift card where you pay like $10 in fees to get the card started. I thought of this idea to get around the “no Skymiles clause” at one point too, but couldn’t come to terms with tacking on 10% more to use it. Guess it is the “frugal” in me that stopped it.
Go HERE to buy a Costco gift card and you can purchase it with your MasterCard of Visa instead of giving in to their demands of AMEX only!
So anyway, I gave my wife a big kudos for being a good samaritan first off, but secondly for finding this little gem to work the system at Costco to finally give us what we’ve always wanted, Costco Skymiling ability!
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11 Comments
May 6th, 2008 at 4:38 am
Awesome! That’s very practical for someone who shops exclusively at CostCo. I normally don’t like gift cards, but I wouldn’t mind one to Giant (where we shop) and I love them for Joann’s where I get my crafting stuff.
Congrats on besting the Man.
May 6th, 2008 at 11:29 am
Cool tip about the credit card, but what I really took away from your post was that you were helping a friend going through hard times. I think you just added to your “Net Worth”.
miracletech’s last blog post..Day Trading Lesson: Roadmap Step 7
May 6th, 2008 at 12:23 pm
I thought the same thing miracletech. Good job on being a good friend it sounds like to me! But secondly, nice to see Costco not keeping Visa and MC out!
May 6th, 2008 at 5:57 pm
Thanks for the tip Hank. I remember the good old days when i’d come home from Costco and my family would say, “You got THAT for HOW much?”
START RANT:
Sadly that is no longer the case.
2 weeks ago I bought 50 lbs. of rice for 14.99. Now the price jumped to $19.99. A 33% increase.
My Costco membership expires in September and am seriously considering not renewing the $50 membership fee. I mean talk about diminishing returns.
END RANT.
Thanks for listening to my Costco rant
RJ’s last blog post..Switched Car Insurance, Saved Half.
May 6th, 2008 at 9:31 pm
@MrsMicah - I hear you, I’m not a gift card fan either. The point is to get you there to spend more than they’re worth so I usually spend them down to a few bucks and then forget about them, but I think I’d use the Costco one.
@Miracletech - thanks for the kudos. I like to help when we can; it’s a good feeling to help others out when you’ve got the leg up. You may not have that leg up sooner or later and need their help.
@Jules - thanks to you too!
@RJ - No problem ranting, that’s the point of blogs, eh? Isn’t everyone out there to rant?
I agree with you though, it ain’t what it used to be! Maybe we should start an underground ring of Costco memberships that we all use a few accounts under the Business Name card and then split the 2% we get back at the end… Wonder what they $ would be then… 
May 30th, 2008 at 6:15 am
Great advice guys! I’ll definitely buy the costco cash card instead of using my debit card. Great tip for friends as well, thanks!
June 28th, 2008 at 11:04 pm
It’s been awhile since I’ve used any gift cards, but seem to remember times when the stores would actually give me $ back as change if I didn’t spend down the entire gift card. You’ll have to check individual company policies, but you might even be able to get $5 or something back from Costco if you bring your gift card down to near $0. Maybe a good side benefit to earning those skymiles with gift cards and coming out the other end with cash rather than Costco goods (even if just a few dollars worth).
June 29th, 2008 at 8:33 pm
I’m a big fan of Alaska Airlines Visa cards and I use mine whenever possible. Costco is not one of those places. However after looking into their AMX offer it looks pretty good. To get a ticket with my Alaska Air miles takes a minimum of 20,000 to 30,000 which means I must spend $1 dollar per mile equaling $20,000. The Costco AMX card gives a 1% cash back option which can be used to purchase an airline ticket or can also be spent on anything, not just an airline ticket. There is no yearly fee to AMX for the card, it does not cost $10 to activate and it looks like now they are also offering 3% back on gas which at todays prices comes to about 12 cents a gallon. Think about it with the Alaska Airlines Visa you get 1 mile per dollar which equals 1% and you HAVE to spend it on an airline ticket. You have no option of using the rebate for anything else. And the 12 cents a gallon on gas is an added plus.
August 4th, 2008 at 4:17 pm
my wife discovered this loophole as well.
i just recently called my local costco and asked if i could
cash out my cash card, and to my suprise she said i could.
all i have to do is get a supervisor to do it for me.
after hearing this i went online and ordered two $600 gift cards(the limit is $1K per card and i don’t think there is a limit to how many), which we’ll both use for costco gas and food.
my plan is to see how easy it is to cash out and if it proves to not be a problem, i am going to purchase an additional $2K worth of cards per month, cash out, redeposit into my banking account and get those air miles from my mortgage payment.
i’m sure that would interest you.
it sounds to good to be true.
we’ll see.
August 4th, 2008 at 5:00 pm
@Jason - AWESOME news - Please do let us know for sure if it works! Interested in doing it myself!
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