CostCo AmEx Card Terms Question

[Scott]

Ok...

I've had the same credit card for years now and have excellent credit. I now purchase pretty much all of my gas at CostCo and of course, they only take AmEx or my debit card.

So, I've thought about getting the AmEx CostCo card so I can get some rewards (3%) for all of the gas I purchase, and 1-2% for all other purchases. I was reading through the terms, and came across this:


Payment Options
Pay over time or pay in full.
Grace Period for purchases is up to 20 days, if the previous balance shown on each billing statement is paid in full by each respective due date.

I have always paid all my credit cards in full each month and would plan to do the same with the AmEx.

Why only 20 days? Does that mean that if I purchase something on the 2nd of one month, but don't get billed until the first of the next month that I will have to pay interest on those purchases made early in my billing cycle? If the billing cycle is 1 month (typically) why a grace period of only 20 days?

Bear with me as I haven't gotten a new card in years...

On another note... does anyone else have the CostCo AmEx card? How do you like it?

[kranky]

The "20 days" refers to the period between your statement date and the due date, not any specific days of the month.

Let's say your statement is issued on the 9th. If you buy something on the 3rd, it will be on your statement issued on the 9th. You'll have 20 days (until the 29th) to pay it in full before interest will apply. If your statement is issued on the 17th, you'd still have 20 days from then.

The billing cycle IS one month, but you only get 20 days from the statement date to pay it.

[Scott]

The "20 days" refers to the period between your statement date and the due date, not any specific days of the month.

Let's say your statement is issued on the 9th. If you buy something on the 3rd, it will be on your statement issued on the 9th. You'll have 20 days (until the 29th) to pay it in full before interest will apply. If your statement is issued on the 17th, you'd still have 20 days from then.

The billing cycle IS one month, but you only get 20 days from the statement date to pay it.

Ok... that makes more sense...

So basically, as long as I pay my balance in full before the due date every month I should be ok.

[kranky]

That's right. The other thing related to what you bolded in your OP is that if you ever DON'T pay in full, you lose your grace period for new purchases (interest will start to accumulate from the day of purchase) until you do pay in full.

[Scott]

That's right. The other thing related to what you bolded in your OP is that if you ever DON'T pay in full, you lose your grace period for new purchases (interest will start to accumulate from the day of purchase) until you do pay in full.

That is good to know.

Is this pretty standard for all cards? I never really took much notice to the APR, terms, etc. of my card since I pay off the last months balance (sometimes more) each month.

[kranky]

Yeah, that's pretty standard. Some cards have what is called the "two-cycle balance" method of computing finance charges which (and I'm oversimplifying) pretty much means if you don't pay in full, you lose your grace period retroactively to the previous month. But if you always pay in full, it doesn't matter.

For people who are certain to always pay in full, the critical issue is making sure there is a grace period for new purchases, so you can pay without any interest.

[Azzycat]

As long as you pay it off every month, you'll be fine. I haven't paid it in full every month and it has a ridiculous interest rate... 22%+. It's as bad as a store credit card (like Kohl's or Sears).

I was about to scrap it honestly until they raised the gas rebate to 3%. It's also 3% at restaurants but I always forget about using it then.

Customer service from the website is WONDERFUL. It's easy to keep track of your statement online and easy to pay the bill.

Online bill pay credits your paymetns instantly from your account...not like some of these stupid online bill paying places that wait 72 hours or so. I never understand that... The bill is marked as paid on the day the second you submit payment, even if it takes a bit longer for your own bank to process it. (I always choose to pay my bill the day I login to my account, but you can schedule payments of course, too)

[Kayakmom]

I have it and I also pay online. Sometimes I just pay it the day I log in and sometimes I schedule it. I also noticed that it immediately credits the payment and returns the available balance to the full amount. Ine time I forgot to pay it online and didn't have access to a computer (and I didn't want to get interest!) so I called in to pay and they were super nice and it was super easy.

Also, you do not need a Costco card when you have it, so one less card to carry. You simply show your Amex at the door and it serves as both.

[SlidingBike]

I have been using Costco AMEX for the last 5 years.
I mostly pay online with my Checking account auto pay.
I pre-schedule the payment each month since Costco AMEX statement date is most of the times 28th of the each month.
I used this Amex Card where ever I can since they will give 1% cash back for all of my purchases.
One more thing I like in Amex cards is their customer services, damn good

[psiu]

Have it and also the Executive membership (which we had free since my wife works there) so we get 5% back on Costco purchases. 3% on gas and restaurants, 1% on everything else. Not sure if that applies to gas or not also, will have to check, we usually don't get gas at Costco since my wife's store doesn't sell gas.