Is a Costco Executive Membership Worth It?

If you love shopping at Costco warehouse clubs as much as money expert Clark Howard does, you may have considered upgrading your Gold Star membership but weren't sure if it's worth the extra cost.

We've explored the benefits of the Costco Gold Star Executive Membership and have run the numbers on it versus a standard Gold Star Membership.

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In this article, we'll talk about who would — and who wouldn't — benefit from upgrading to a Gold Star Executive Membership.

Costco Gold Star Executive Membership: Can You Save Money by Upgrading?

As the old saying goes, “Sometimes you have to spend money to make money.”

Costco tempts frequent shoppers to upgrade their memberships by offering a number of perks, but an upgrade comes at a cost. Let’s break it down to see if spending that extra $60 a year would be worth it for you.

How Much Does a Costco Gold Star Executive Membership Cost?

A basic Costco Gold Star Membership, which is required to shop in the warehouse store in most — but not all — cases costs $60 a year.

A Costco Gold Star Executive Membership costs double that: $120 a year. However, Costco will prorate that amount based on the number of months remaining on your current membership. That means that if you are six months into your basic membership, upgrading to Executive for the remainder of the year will cost you only $30.

Costco says its 100% Satisfaction Guarantee applies to memberships and that it will refund your membership fee at any time if you are not completely satisfied.

What Are the Advantages of Having an Executive Membership?

The biggest advantage of upgrading to a Gold Star Executive Membership is that you get an annual 2% reward — up to $1,000 — on almost everything you buy from Costco.

You get this 2% back in the form of a rewards certificate Costco will mail to you with your annual renewal notice. You can use the certificate to pay for most items you buy at the register in a Costco warehouse.

Purchases that do not qualify for the 2% reward include:

  • Cigarettes and other tobacco-related products
  • Gasoline
  • Costco Shop Cards (gift cards)
  • Postage stamps
  • Alcohol (in certain states)
  • Food court purchases
  • Membership fees

Note that, while travel purchased through Costco does qualify for the 2% reward, some other costs related to that travel do not. This includes things like surcharges, gratuities, trip protection, and resort charges.

Costco also says that an Executive Membership qualifies you for discounts on Costco services like check printing and identity protection.

How Do I Know if an Executive Membership Makes Sense for Me?

Obviously, the biggest advantage to upgrading to an Executive Membership is the 2% reward. It basically amounts to an additional 2% discount on almost everything you buy at Costco’s already-low prices. But paying more for the Executive Membership makes sense only if you’re going to spend enough at Costco to justify the additional $60 a year.

Here’s how to figure out if it’s worth it for you:

Costco Spend Per Month Costco Spend Per Year Annual Reward
$100 $1,200 $24
$200 $2,400 $48
$250 $3,000 $60
$500 $6,000 $120
$1,000 $12,000 $240

As you can see from the chart, spending $250 a month is the break-even point for whether an Executive Membership is worth it for you.

Look back at your Costco expenses from the past several months or past year, if possible. Did you spend more than that? If so, you’re leaving money on the table if you’re not an Executive Member.

Of course, if you plan to take advantage of other Costco services, your break-even point could be even lower when you factor in the discounts.

And if you’re planning to book a big vacation through Costco, that trip alone could be enough to pay for your membership upgrade.

Final Thought

If you’re a frequent Costco shopper who’s never thought about upgrading to the Executive Membership, it might be time to crunch some numbers. Check your spending patterns and see if the 2% reward justifies the expense. You might be surprised to learn that you’re missing out on some real savings opportunities — and that’s something Team Clark never likes to see.

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