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Q: With my credit card, I earn 5% cash back at grocery stores. I do a lot of my shopping at club stores like Sam’s Club and Costco. I’m not earning the 5% cash back. Are these stores not considered grocery stores?
In pretty much every credit card rewards program, “club” stores like Costco and Sam’s Club don’t count. In fact, neither do “superstores” like Walmart Supercenter. These stores normally earn 1% cash back or less.
Grocery stores are stores like Publix, Kroger, or Whole Foods that focus mainly on food.
Although it seems like Walmart and Sam’s Club should count, since they sell plenty of groceries, it would cost credit card companies too much money to label them as such.
You can buy almost everything you need at these stores, so if you took advantage of that opportunity, these programs would end up paying you 5% cash back on most of your purchases. Since they only make around 2-3% a transaction, they would be losing money with each purchase.
There are some ways to get around these restrictions.
For example, you could buy a Walmart gift card at a grocery store, and it should show up on your credit card as a grocery store purchase. You could then use this gift card to shop at either Walmart or Sam’s Club.
You can also buy restaurant gift cards at a grocery store if you get better rewards for groceries than for restaurants.