I kept debating whether our costco membership actually saves money or if we're fooling ourselves into thinking bigger packages mean better deals. Finally tracked everything for six months.
We spent about 8400 dollars at costco over that period and I compared prices on everything to walmart, target, and amazon.
The results were mixed. About sixty percent of what we bought was genuinely cheaper at costco when comparing unit costs, including gas, rotisserie chicken, eggs, butter, kirkland brand stuff, and some household basics. But forty percent was actually the same price or more expensive than walmart or target, especially snacks, some cleaning products, and random impulse purchases.
Net savings on stuff that was cheaper came out to about 500 dollars over six months. Minus the 65 dollar membership fee, the actual annual savings are around 870 dollars. Not nothing but less than I thought.
The bigger issue is we probably spent more overall because costco's setup encourages buying stuff you don't need. If I factored in impulse purchases that wouldn't have happened at walmart the math looks worse.
Keeping the membership but being more disciplined about only buying what's actually a deal there.
costco membership worth it or not after tracking every purchase for six months
byu/Traditional_Zone_644 inpersonalfinance
Posted by Traditional_Zone_644
36 Comments
we use the costco card for purchases at costco including gas.
It’s not our major card that we use but it was still $500 last year in benefits. It’s an EASY yes for our family of 4.
About to join Costco to support them vs Target Walmart and Amazon. Less concerned with the financial reward — just tired of supporting awful companies everywhere.
Household size really scales things too. For two people having a membership doesn’t make a huge difference, but when you have a household with say 5 people, it makes sense because they have deals on bulk goods that add up like toilet papaer, diapers, etc. Yeah to impulse control, hard one that.
Yeah I gave up my sam’s club 25 years ago when I had the same realization. Did a lot better by shopping the deals at my local supermarkets.
And now we see why they don’t offer click n pull curbside shopping.
I haven’t done the work to track it but I came away with the same conclusion just thinking it through and doing some cocktail napkin math. I explained to my wife that we both buy things there in bulk that we don’t need in bulk because they’re just for one of us and not the whole family. And we make impulse purchases, although we’ve done pretty good on that front. Most of our impulse buys are things we could justify, but at the end of the day I’m reminded of the car commercials that say something like “if you don’t come see us we can’t save you money.” Yeah well, I can’t spend it either.
You telling us you don’t impulse buy at Walmart? Ha!
What percentage was actually higher than what it could have been elsewhere ? You mentioned 40% was the same or more expensive but I would be interested to know what percentage was actually more expensive.
It seems that impulse buys are the major problem, which you can still get at other places (even if not the same extent) unless you switch to online buying, which is not a given either.
Pharmaceuticals are much less at Costco. Money saved on just two prescriptions more than paid for the membership.
As someone who routinely goes in to just buy rotisserie chickens and nothing else, i feel like i save money with a membership from those chickens alone since i can get like 4-6 meals out of one.
How does Walmart not offer impulse purchases.
Costco one of the biggest cult frauds of the century unless you have a massive family .
I use it for random work items but 90% of the stores SKUs are the same items past decade that never change . How don’t you people get sick of it ? The snacks aisle is the same basic 40 items and then 1-2 new ones a month maybe
The Costco products that cost more than the alternative are usually of better quality. For example we started getting our shredded cheese at Aldi for a while because of price per pound but switched back when we found how much better the Costco stuff melted.
Family of 5, two cars. Our executive membership rewards last year ( membership and visa) totaled just about 1,100. You can impulse buy anywhere, not just Costco
If you workout and buy protein frequently, it’s a no brainer. 2 bags of protein and you have already broke even with the annual membership fee. And their protein is like $30 cheaper than at gnc or vitamin shop.
Costco executive membership is for a family. I shop there quite a bit and almost exclusively get gas there and every year the cashback I receive pays for the membership and then some. So in that regards, it doesn’t cost me anything. I’m already buying in bulk and when I travel, I only stop at Costcos cause they have super clean restrooms and you can feed a family there for less than 15$ at the food court.
I mean it also doesnt include some of the biggest reason people like costco, their return policy. I know i can return most things without question to Costco so i feel more comfortable spending more.
Big purchases like appliances or mattresses, i pay a little more to go with Costco since i know if something is wrong, they will handle it
I joined Costco solely for the return policy.
Regarding discipline, I use the lists feature on the Costco app to save a perpetual list of my stock-up items: toothpaste, paper towels, deodorant, graham crackers, etc. Things that are actually cheaper and I always need to keep an eye on refilling.
When I shop, I have only that limited list and then I’ll let myself grab one convenience meal like shepherd’s pie, which isn’t cheap but lasts a while. I don’t let myself buy anything else.
Do you not buy gas at Costco? I think that alone is worth the membership. $65 per year quickly adds up when you factor in the cost for gas is significantly lower than any other place (except other wholesale clubs like Sam’s and BJs).
The Costco credit card makes it worth it for me. Between gas and the regular cashback on purchases at the warehouse, it pays for my membership and then some.
I make my membership fee back in my HVAC filters alone and I only shop via a list so my impulse buys are basically zero. They also routinely have the cheapest rental car options and their travel packages are great deals
You should have been an executive member 2% on 8400 in six months already pays for the membership itself
You saved 870 dollars in a year, and you’re questioning its value? Seems pretty clear to me.
I find the Kirkland products is of better quality than most store brand products. But you are certainly right about the impulse buying
Worth it for – paper towels, meat, toilet paper… staple items that you KNOW you need/like
Where I waste $- “this looks good, let’s try it. Oh, I need to buy 50 of them”…. End up not liking it, wasting food & money.
However, I find wholesale has def been a $$ saver for my household in NYC. The supermarkets here are SO expensive, so even when you buy 50 off something it’s usually cheaper than the regular size at the supermarket.
I don’t think having to deal with the lines and amount of people inside Costco makes saving a few dollars worth it to me. That place stresses me out every time I go there. There’s never any parking, people are in such a rush no matter what time you go in there.
The only thing I think is worth it is the $1.50 hotdog but even then finding a place to sit is a battle.
However they have special pricing for members vs non members.
Let’s put it this way: I wish I would have bought Costco stock 10-15 years ago.
Kirkland paper towels and toilet paper are great quality. I’d take KL paper towels quality over Bounty any day and KL is cheaper. We always look at Costco for big ticket items too. We bought a 65” tv and an HP laptop in the last couple months, both items saved money over Best Buy. Using our Costco credit card got us almost $900 back from last year. Their cheeses are really good. I don’t generally buy produce because it’s just the two of us and buying bulk means waste. The major impulse buys I do are their clothes which are good quality and very affordable. Some of my favorite everyday clothes are Costco.
I don’t specifically go to Costco to get gas but if I’m there and my tank is low, I’m filling up.
For me, the gas savings alone pays for the membership.
The savings from my gasoline consumption at Costco vs. what it would be at gas stations alone, pays for the membership.
4% cash back credit card & cheap gas.
100% worth it for me and my family just on fuel … the savings on food is just icing on the cake
There is much to be said about shopping anywhere with a hardcore list in hand, and sticking to that list.
And now, having done the leg work, that’s your point going forward. Not the cleaning supplies and snacks, not the impulse buys, etc.
You can create a master list and now you know where your cost savings are, so mark on the list where you’re buying stuff and stick to it.
Every store is set up to encourage buying things you don’t need. Costco is the place I am least likely to impulse buy because there are no small purchases to make! …except the $1.50 hot dogs.