Everyone has an opinion about Costco: some say "so cheap, definitely get it" and some say "it is crowded and you are spending money on big packages." Both are partly true. I bought the same products from both Costco and regular grocery stores for 6 months and compared prices.
Was this effort worth it for the $65 Gold Star membership? Short answer: for some products absolutely yes, for others you will not get that money back.
Costco Membership: How Much, What Do You Get?
The basic Gold Star membership is $65 per year. Executive membership is $130 but it gives back 2% of your annual spending as cash. For people who shop a lot, the second one can make sense.
The membership card can be used together with your spouse or partner living in the same household. If two people will be entering Costco, one membership is enough.
Categories Where There Is Real Value
Paper Products and Cleaning Supplies
Toilet paper, paper towels, dish soap, laundry detergent. In these, Costco is seriously cheap. But "seriously" means big packages. You need to be ready to buy 30 rolls of toilet paper.
The math is simple: per roll, Costco is 20-30% cheaper than Walmart. When you think about yearly use, this adds up to good money.
Meat and Protein
Chicken breast, salmon, ground beef. Meat prices at Costco have a clear advantage. But again, big packages: 10 pounds of chicken breast. If you have a freezer and you eat meat, this category is definitely worth it.
Fresh fish, especially Costco's salmon, the quality is very good and when you calculate per pound it is reasonable.
Organic Products
Organic eggs, organic milk, organic baby food. In these, Costco clearly wins compared to Whole Foods. Compared to Trader Joe's it is closer but Costco is still generally cheaper.
Gas
Costco has its own gas station (at most locations). The price is usually 10-20 cents cheaper than the area average. This sounds small but for people who drive, it can turn into $100-200 savings per year.
Seasonal Products
Clothing, home decor, and electronics. In these Costco is inconsistent but sometimes puts out amazing deals. You might see different things every visit. The mentality is "today's item at today's price": if you like it, buy it. It might not be there tomorrow.
When Costco Does Not Offer Value
- If you live alone or in a small household: Big packages can go bad before you finish them. 5 avocados is fine but a 12-pack of avocados, how many days will that take to eat?
- If you want variety: Costco stocks specific brands, it does not offer variety. If you have "I want this brand not that brand" preferences, Costco is limiting.
- If you prefer small sizes: For someone who does not want to buy 1 kilogram of green tea instead of 100 grams, Costco does not make sense.
Costco Cart: A Typical Month
My Costco shopping is usually once a month. What goes in the cart: meat (chicken and salmon), toilet paper and paper towels, detergent, eggs, sometimes cheese. For this list, the spending comes out about $25-35 less than Walmart or Kroger. That means roughly $300-400 savings over a year.
The $65 membership pays for itself in 2-3 months. The remaining 9-10 months you are "in profit." For me it makes sense.
Things to Know Before Your First Visit
- They do not accept cash for membership purchases (they take Costco Visa or debit card, no other credit cards)
- Some locations are unbelievably crowded on weekends. Go on a weekday
- Free sample distribution is real and it actually happens. Go when you are hungry
- The return policy is almost unlimited. You can return something you bought a year ago (except electronics)
- To find a location: "Find a Warehouse" page on costco.com
Is the Membership Worth Getting?
Yes, if:
- You will go at least once a month
- You live in a household with 2+ people
- You drive a car and buy gas (gas savings alone can cover the membership)
No, if:
- You live alone and buy in small quantities
- There is no Costco near you (meaning gas and time costs go up)
- Variety matters to you. Costco offers selected brands only
Costco's membership model is a very interesting business approach: the store's profit margin is minimal, the real income comes from membership fees. That is why product prices can be kept genuinely low. When I understood this strategy, I understood better why it is so popular.
