Is an AARP Credit Card Worth It? A Detailed Financial Analysis

With two different co-branded credit cards offered through Barclays, AARP has options for a variety of consumers. So, is an AARP credit card worth it? The answer largely depends on your spending habits, since the cards offer distinct bonus categories for earning cash back.

Quick Summary

An AARP credit card's value depends on your spending habits and whether you can find better rewards elsewhere. It offers no annual fee and bonus cash back in specific categories like gas, drugs, and medical expenses on the Essential Rewards card, or travel and dining on the Travel Rewards card. Non-members can apply, but other cards may offer higher or more flexible rewards.

Key Points

• No Annual Fee: Both AARP cards have a $0 annual fee.

• Targeted Bonus Categories: Essential Rewards offers high rewards for gas, drug stores, and medical expenses; Travel Rewards for travel and restaurants.

• Flat-Rate Alternatives May Offer Better Value: A flat cash back card could earn more depending on spending habits.

• Membership is Not Required: You don't need AARP membership to get a card.

• High Balance Transfer Fee: A 0% intro APR on balance transfers is offered, but a 5% fee applies.

• Risks of Credit Limit Decreases: Some users have reported unexpected credit limit reductions.

• High Redemption Threshold: The Essential Rewards card has a $25 minimum for cash rewards redemption.

Barclays issues two primary AARP co-branded credit cards: the Essential Rewards Mastercard and the Travel Rewards Mastercard. Both cards stand out for their $0 annual fee, but their value proposition hinges on how well your spending aligns with their unique rewards structures.

Essential Rewards vs. Travel Rewards: Which Card is Right for You?

The choice between the two AARP cards depends on your spending patterns. The Essential Rewards card caters to everyday needs, while the Travel Rewards card is designed for travel and dining expenses. Maximizing your cash back requires understanding their distinct bonus categories.

Essential Rewards for Everyday Spending

The AARP Essential Rewards Mastercard is tailored for those who spend significantly on household and health-related items. It offers specific cash back rates for categories like gas, drug stores, and eligible medical expenses.

Travel Rewards for Explorers and Foodies

The AARP Travel Rewards Mastercard is suited for those who prioritize travel and dining. Its bonus categories include rates for airfare, hotel stays, car rentals, and restaurants. This card does not charge foreign transaction fees.

AARP Credit Card Comparison

For a comparison of features like annual fee, rewards structure, and welcome bonuses between AARP cards and alternatives like the Citi Double Cash® and Capital One Quicksilver Cash Rewards, please refer to {Link: NerdWallet https://www.nerdwallet.com/article/credit-cards/aarp-credit-card}.

How to Assess if an AARP Credit Card is Right for You

To determine the value of an AARP card, consider:

• Your Spending Profile: The Essential Rewards card benefits those with high spending on gas, drug stores, and medical expenses, while the Travel Rewards card suits those who spend more on travel and dining.
• Flat-Rate vs. Tiered Rewards: A simple flat-rate card might offer more overall cash back depending on your spending mix.
• Membership Perks: AARP membership is not required to apply, but members can earn additional points through the AARP Rewards program. Membership is open to all ages.
• Redemption Minimums: The Essential Rewards card requires a minimum for cash rewards redemption.
• Balance Transfer Considerations: A 0% intro APR on balance transfers for 15 months is available, but the balance transfer fee should be considered.
• Credit Limit Stability: Some users have reported unexpected credit limit reductions from Barclays.

Conclusion

An AARP credit card can be valuable if your spending aligns with the bonus categories of the Essential (gas, drugs, medical) or Travel (travel, dining) cards, especially with the $0 annual fee. However, the rewards may not be the highest overall, and a flat-rate cash back card might offer more flexibility. Prospective cardholders should compare their spending and the card's features.

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[Disclaimer: Terms and conditions for credit card offers are subject to change by the issuer. Always review the most up-to-date information on the issuer's website before applying.]

Authoritative Outbound Link

For more information on comparing the AARP cards to other cash back and travel cards, see the analysis provided by {Link: NerdWallet https://www.nerdwallet.com/article/credit-cards/aarp-credit-card}.

Frequently Asked Questions

Is an AARP credit card good for everyone?

No, its value depends on spending habits aligning with bonus categories like gas, medical, or travel. A flat-rate card might be better for diversified spending.

Do I need to be an AARP member to get an AARP credit card?

No, membership isn't required, but members get additional perks through AARP Rewards.

What is the difference between the AARP Essential Rewards and Travel Rewards Mastercards?

Rewards differ: Essential Rewards favors gas, drug stores, and medical expenses, while Travel Rewards favors travel and dining.

Is the introductory balance transfer offer on the AARP credit card worth it?

The 0% intro APR can help with debt, but the 5% fee needs to be considered against potential interest savings.

Are the AARP credit card rewards competitive with other cards?

They are competitive in specific bonus categories like medical expenses, but other cards might offer a higher general rate or welcome bonus.

What are the drawbacks of the AARP credit cards?

Drawbacks include potential credit limit reductions, a tiered structure less lucrative for general spending than flat-rate cards, and a 5% balance transfer fee.

How do you redeem rewards from an AARP credit card?

Redemption options include cash back, statement credits, gift cards, merchandise, or covering AARP membership costs.