Fred Meyer Rewards MasterCard Credit Card Review

Summary - If you shop at Fred Meyer, the Fred Meyer credit card can help you save money by letting you earn Fred Meyer Rewards points. This card will also let you save if you use their gas stations as well. But as you'll see at the end of the review, it faces stiff competition from a rival. Find out who it is.

Fred Meyer Reward Formula - The Fred Meyer Rewards MasterCard allows you to earn double points when you shop at their stores. When you shop at their gas stations, you can get a 5 cents discount at the pump if you scan and use this card.

Bonus Points - New cardholders will get $25 off their next Fred Meyer purchase when they get approved for the card.

What Are Fred Meyer Reward Points Worth - Once you earn 500 points, you get $5 rewards rebate which you can use at their stores.

There are two aspects of this card that we have to do peer comparisons on. The first is the reward formula. There second is the gas rewards because they give you a 5 cent discount for gas purchases at their station.

In terms of their rewards, it is quite similar to other grocery credit cards. For example, Ralph's (of Albertson's), Kroger, BJ's (the discount warehouse) all allow you to earn 2 points for every dollar that you spend at their stores. In this aspect, it matches what other similar cards are offering. However, Kroger and Ralph's credit cards allow cardholders to earn triple points when they buy their own in house brands. The Fred Meyer credit card does not allow you to earn triple points when you buy their brands. Hence, they fall short in this area versus other cards.

So overall, I would say that their rewards is pretty typical of most supermarket credit cards. And they also fair pretty well against warehouse credit cards. For example, the BJ's credit cards allows you to earn double points at their warehouses. So Ralph's comes out slightly ahead because you can earn triple points when you buy their in house brands. The Costco credit card is a slightly different animal because you do not actually earn extra points for shopping at Costco, but instead earn extra rebates on items like gasoline, dining and travel.

In terms of gas rebate, Fred Meyer has taken the route (much like Chevron) of giving a fixed rebate in price rather than giving a certain percentage of rebates. Most gas cards will give cardholders a fix percentage in rebates (like 3% or 5%) rather than 5 cents rebates. So what does 5 cents per gallon equate to in percentage? Well, it really depends on what is the price of gasoline? So rather than guess, I worked out a list of break even points.

Breakeven at $4.00 per gallon - At $4 a gallon, the rebates you get is actually 1.25% (not good)

Breakeven at $3.50 per gallon - At $3.50 per gallon, the rebates works out to 1.43%

Breakeven at $3.00 per gallon - At $3.00 per gallon, the rebate works out to 1.67%

Breakeven for 3% rebates - For you to earn 3% in rebates, the price of gasoline has got to be $1.67 per gallon

Looking at the calculations, earning 5 cents per gallon in rebates is not very attractive because the average all round gasoline cards pay 2% to 3% rebates. Dedicated station gas cards pay 3% to 5% rebates.

Another card that we should compare the Fred Meyer Rewards MasterCard is the Blue Cash Everyday from American Express. The reason is that this is the only card that pays 3% cash rebates for grocery spending. This is 1% more than what the Fred Meyer card is paying. And you can use it at any grocery store or supermarket to earn 3% rebates. Furthermore, you also earn 2% cash back at gasoline stations and department stores. As we have seen from the break even calculations of the Fred Meyer gas rebate, 2% from Blue Cash Every beats the rebates that Fred Meyer is paying based on current gasoline prices.

For those with average credit (say mid 600 scores), the Barclaycard Rewards MasterCard® is a great alternative because you can earn 2X points on groceries, gas and utilities.  

Verdict -Based on the comparison we have just made, we could safely say that the Fred Meyer Rewards MasterCard is typical of most supermarket credit cards in it's reward formula. However, if you are thinking of getting this card, I would suggest the Blue Cash Everyday instead. Firstly, you get a higher rebate (3% vs 2%) when you shop at Fred Meyer stores (and any other supermarket), and you earn higher rebates on gasoline purchases. While you are only likely to get approved for the Blue Cash is you have great credit, the Barclaycard Rewards MasterCard is a great alternative if you credit is average.