Is Costco Worth It?

People like to rave about the savings that Costco brings, and they think that everyone should have a membership at the club warehouse. If you know one of these people, then you are likely already locked into a Costco membership because of their ravings. However, if you have not yet made the plunge, you are probably wondering if you should actually pay the annual membership fee or not.

Costco’s annual membership is a pretty smart business model in general for them. People feel like they have to shop at Costco in order to get their money out of the membership. So Costco gets money for everyone that has a membership, and then they get even more money for all of the money that people are now spending at Costco over other stores. They make a lot of money by making you feel this way.

If you’ve never shopped at Costco before, then before you make a decision one way or the other on a membership. If you don’t know what they have to offer, then it really doesn’t make sense to get a membership. Unfortunately, there’s no free trial at Costco so you’ll have to tag along with someone that has a membership already to see what they have and actually buy something.

The first thing to note is that for a lot of things at Costco, you are not going to see a huge savings compared to the regular store. If you’re buying produce and meat products, you’ll likely pay as much, if not more, for the same food as at the grocery store down the street. Costco will often have the best quality on those items though, so the price premium at Costco is often because of the quality.

There are items in Costco that will provide a significant savings to you over buying at the regular store. If you have kids in diapers or that are drinking formula, Costco has the best price on high quality diapers and formula that you will find. Many of their store brand (Kirkland Signature) items are on par with name brands, but much cheaper. If you’re buying a lot of diapers, it may be worth the membership for that period of time.

Costco also offers significant savings on other household items that you can buy in bulk. From paper products to cleaning supplies, you’ll often find that Costco has the best price to volume ratio on these items. And once again, the quality of the items that they offer is generally on par with the top name brands. It can easily be worth the membership fee just for these items alone spending on how much you buy.

The biggest downside to Costco is that you’ll buy way more than you really need. If you’re unable to control your impulse buys, then Costco is going to cost you a lot of extra money. They offer some excellent snack and dessert options that you probably don’t really need. Of course, these items are found right at the exit, so it’s really easy to grab an item or two as you’re heading to pay. If you can’t control yourself then you’ll be dropping $20+ on items you don’t really need.

If you have a Costco close by, then a membership probably makes sense for a family. However, if it’s a long drive or you can’t control your impulse buys, then it may not be worth it to you. We spend more money then we should at Costco.