Kroger is among the largest grocery retailer chains within the U.S., with over 2,700 shops throughout 35 states. In the event you’re a devoted shopper at one of many many shops within the Kroger “household,” you may be contemplating the Kroger 1-2-Three REWARDS® World Mastercard® for your frequent grocery runs.
However even for Kroger loyalists, this card is not aggressive, due to its mediocre, rigid rewards and clunky redemption course of. Most consumers can be higher off investigating basic cash-back credit cards, any variety of which might be extra versatile and profitable.
Listed below are 5 issues to know in regards to the Kroger bank card:
Nerd tip: Shops within the Kroger Co. family embody Kroger, but additionally Ralphs, Harris Teeter, King Soopers, Baker’s, Dillons, Smith’s Meals and Drug, Fred Meyer, and Gerbes, amongst others.
1. Rewards are mediocre and restricted
The Kroger 1-2-Three REWARDS® World Mastercard®, issued by U.S. Financial institution, earns the next rewards:
Three factors per $1 spent on sure Kroger “own-brand” merchandise.
2 factors per $1 spent at any Kroger-owned retailer (not together with Kroger gas facilities).
1 level per $1 on all different spending.
Reductions on eligible gasoline purchases.
Each 1,000 factors you earn equals $5 in free groceries at Kroger shops, which suggests a degree is price half a cent every. That is effectively beneath the trade normal of a full penny per level, and it implies that even on the card’s highest 3x rewards fee, you are getting simply 1.5% again that you need to use towards purchases at Kroger shops. There are many cash-back credit cards that earn 1.5% back or increased on all spending.
And about that 3x tier: It is reserved just for eligible store-brand merchandise (Kroger, Easy Fact, House Chef and Pet Pleasure, among others). In the event you do not like Kroger’s private-label items and as an alternative attain for the Heinz, Hunt’s or Hellmann’s, you then’ll must accept decrease rewards.
Many cash-back playing cards supply higher rewards and are far much less restrictive when it comes to the place and how one can earn them. Think about the $0-annual-fee Chase Freedom Unlimited®. It affords new cardholders 5% money again at grocery shops (not simply Kroger shops) for the primary yr, on as much as $12,000 in spending. After that, you drop again to 1.5% again at grocery shops — however when it comes to level worth, that equals or exceeds what the Kroger card can supply even in its highest tiers. And that is not considering the a number of different bonus classes featured on the Freedom Limitless. Plus, you’ll be able to spend your money again nonetheless you want, not simply with a single model.
2. Redemption is cumbersome and restrictive
Talking of which, factors earned by way of the Kroger 1-2-Three REWARDS® World Mastercard® can’t be redeemed for money again. Quite, they accrue towards “rewards certificates” that can be utilized solely inside the Kroger household of shops.
Apart from a scarcity of rewards flexibility, there are different hurdles:
You may’t “financial institution” factors: For each 1,000 factors that you just accumulate, you’ll mechanically obtain a $5 rewards certificates for use at a retailer underneath the Kroger umbrella. Meaning you can not save up a giant stash of factors to make use of later, and it additionally implies that you probably have solely 999 factors, they’re no good to you but.
You will have to attend: Rewards certificates are issued solely 4 instances annually and are mailed to cardholders in February, Might, August and November. Any remaining factors you will have that fall in need of incomes a $5 certificates shall be rolled over to the following redemption interval.
You are on the clock: Factors expire after three years, and rewards certificates are on a fair shorter timetable: They have to be used inside one yr of the date they’re issued. (Additionally they cannot be redeemed at Kroger gas facilities).
Whereas a few of these restrictions include the territory for store-branded bank cards, this isn’t how most basic rewards credit cards work. You could find many with no minimal required redemptions, no expiration date on rewards, and no want to attend by the mailbox each few months for a certificates that is usable solely in sure shops.
Take the $0-annual-fee Blue Cash Everyday® Card from American Express. It earns 3% money again at U.S. supermarkets — not simply Kroger shops — on as much as $6,000 spent per yr (then 1% again). That $6,000 spending cap is effectively above what the common U.S. family spends on groceries. And, once more, you are incomes money again, not factors.
3. There is a separate gas rewards program
In the event you get the Kroger 1-2-Three REWARDS® World Mastercard®, you may mechanically be enrolled in Kroger’s shopper-loyalty program. (Bank card or not, membership is free and you may enroll on-line or in a Kroger-owned retailer).
As a member of this system, you may earn 1 “fuel point” for each $1 you spend on groceries — with some exceptions — at any retailer within the Kroger community. Here is how this system works:
Gasoline factors will be redeemed at Kroger gas facilities and taking part Shell gasoline stations. At Kroger gas facilities, you’ll be able to redeem as much as 1,000 gas factors for $1 off per gallon. (You may redeem in 100-point increments, as much as 35 gallons.) At eligible Shell stations, you’ll be able to redeem 100 gas factors for 10 cents off per gallon.
There’s no restrict to what number of gas factors you’ll be able to earn every month. However these factors do not carry over and as an alternative expire the final day of the month after they’re earned.
Gasoline factors apart, you probably have the Kroger bank card, you can too earn an ongoing 5-cent-per-gallon low cost at eligible Kroger gas facilities. However when it comes to bank card factors on these gas purchases, you may nonetheless be rewarded on the card’s baseline fee (1 level per $1 spent). And the rewards certificates you earn with the cardboard cannot be redeemed at Kroger gas facilities.
Nerd tip: Not all Kroger grocery retailer areas within the U.S. have gas facilities the place you’ll be able to pump gasoline and redeem gas factors. Kroger’s fuel locator will help you discover which gas facilities are closest to you.
4. There is a two-part sign-up bonus
The Kroger 1-2-Three REWARDS® World Mastercard® options the next welcome affords:
By way of Jan. 15, 2021, the cardboard is providing 5% money again in assertion credit score, on as much as $2,500 in purchases, inside the first three months of account opening. In the event you had been to max that out, you’d earn $125. That is not dangerous, however many cash-back bank cards supply bonuses of $150 or more for lots much less spending.
New candidates will even get 25 cents off per gallon of gasoline, as much as 35 gallons per fill-up, throughout the first yr of utilizing the cardboard. To obtain the low cost, you’ll must redeem no less than 100 gas factors, if you scan your card, at eligible Kroger gas facilities. (The low cost drops down to five cents per gallon after the primary yr.) In the event you drive quite a bit, this will add as much as pretty large financial savings on gasoline, though maintaining monitor of and redeeming gas factors will be high-maintenance.
Nerd tip: The 25-cent-per-gallon low cost supply isn’t obtainable in Louisiana or Missouri.
5. Attempt to keep away from carrying a stability
Carrying a stability with this card would eat away at any rewards or reductions you’d earn.
Details about the Kroger 1-2-Three REWARDS® World Mastercard® has been collected by NerdWallet and has not been supplied or reviewed by the issuer of those playing cards.