Should You Pay for a Costco Membership?

Should You Pay for a Costco Membership?
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By Sheiresa Ngo,

Shopping at a warehouse store, such as Costco, can feel like a magical treasure hunt. The entire store is yours for the picking, and all you can see are aisles of your favorite products — in supersize. It can be hard to resist purchasing everything in sight. It’s a shopper’s dream. Or is it? Could there be drawbacks to applying for a warehouse store membership?

If you’re trying to save money, your friends and family might have told you one of the best ways to do so is to join a warehouse club, such as Costco or Sam’s Club. In some ways they might be right, but in other ways they’re wrong.

Although there are great deals at Costco, whether they’re worth it depends on the items you buy and your living situation. Take a look at your individual circumstances before getting a membership card. Is a Costco membership worth the price? Let’s look at some pros and cons to help you decide.

Pro: Access to Services

Costco offers members access to an array of services you probably didn’t think you could get from a warehouse store. For example, members can get deals on auto insurance, homeowners insurance and travel packages. Costco also offers access to vision care, banking services and health and life insurance. If you’re looking to purchase a home, Costco provides assistance with acquiring a mortgage and refinancing an existing mortgage.

Con: Not Enough Space

Where will you put everything you buy? If you don’t have adequate storage space, buying in bulk will cause clutter. Think about where you’re going to store your items before going on a bulk shopping spree. Avoid having to apologize to guests because you have boxes of bulk items on your couch.

Pro: Deals

You can get great deals at Costco on items you might not be able to get discounted at other retailers. For example, Costco offers deals on vacations and gift cards. Some of the featured vacation deals are all-inclusive packages, $499 and under deals, and 3% cash-back rewards for Costco Anywhere Visa holders. (You’ll need an excellent credit score to qualify for the Costco Anywhere Visa Card by Citi. Find out where your credit stands by looking at two of your credit scores free on If you and your family frequently eat out, Costco restaurant gift cards offer great savings. Gift cards are available for restaurants like Pei Wei, Shogun Restaurant and Baja Fresh. Gift cards for restaurants are 20% to 30% off the regular price. You can read a review of the Costco Anywhere Visa card here.

Con: Overspending

If you don’t have a big family, Costco is not such a lifesaver. It can cause you to spend more than you need. If you live alone, how long will it take to go through ten boxes of cereal or a 15-pack of facial tissue? It might be better to just buy what you need.

Pro: Fewer Shopping Trips

Making several trips to the store is a time waster and potential budget buster. When you need to shop for a group of people, you likely have limited time and money, so every trip counts. It’s often more cost-effective to buy in bulk than to purchase individual items. When you frequently purchase individual items, you risk purchasing something you already have at home. You’re basically on autopilot when you shop frequently, so it’s natural to pick up what you always buy during shopping trips. You can save on transportation costs and reduce the chances of buying the same items when you purchase a larger quantity.

Con: Waste

With all the great deals, it can be tempting to let your eyes do the shopping. However, if you buy a food item in bulk and don’t use all of it in time, you’ll be stuck with a lot of expired food. If there’s no way you can finish all the items you purchase, you’re better off buying in smaller quantities. Instead of throwing away what you don’t use, keep an eye on the expiration date and donate any unused portions.

Pro: Big Savings for Big Families

If you have a big family, Costco is a lifesaver. Living with several people means you’ll run out of toothpaste and other essentials faster. When you shop in bulk, however, you’re less likely to have to reach for the paper towels — or worse, coffee filters — when you run out of toilet paper. Staying stocked with everything you need makes for a happier family.

Con: Unused Membership

Like a gym membership, it can be easy to let your Costco membership go unused. Perhaps you’re too tired to bother with crying babies and impatient shoppers pushing ahead of you. Or you might reason it’s easier to pop into your local grocery store to buy a few items. Remember: A warehouse store membership is only worth it if you use it. Otherwise, you’re wasting your money.

Alternatives to Costco

Only you can determine whether a Costco membership makes sense. Costco offers Gold Star and business memberships for $55 per year, while the Executive Membership is $110 per year and offers additional perks, such as an annual 2% reward on qualified Costco purchases, additional discounts at Costco Services and extra benefits on Costco Travel products. Take stock of the pros and cons, and figure out whether a membership aligns with your financial goals and budget. Here are three alternatives to consider.

Amazon Prime

  • Annual membership: $99
  • Features: Although Amazon Prime is different from traditional warehouse stores in that it is only online, it still offers notable deals. Some features include free two-day shipping, free same-day delivery to certain ZIP codes, free e-books and one free add-on membership.


  • Annual membership: $50
  • Features: Members can get deals on home improvement, eye care and extended warranties. There are also reduced prices on gas and BJ’s store brands. Online shoppers can also take advantage of instant coupons.

Sam’s Club

  • Annual membership: $45
  • Features: Members can save time by ordering items online and picking up their purchases at a local Sam’s Club. You can also upgrade your membership to take advantage of early shopping hours, additional product protection and exclusive pharmacy savings.

Note: It’s important to remember that interest rates, fees and terms for credit cards, loans and other financial products frequently change. As a result, rates, fees and terms for credit cards, loans and other financial products cited in these articles may have changed since the date of publication. Please be sure to verify current rates, fees and terms with credit card issuers, banks or other financial institutions directly.

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