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There’s a reason millions of people have a Costco membership. The store is known for its competitive prices on a wide range of products, from groceries to apparel to household essentials.
But simply walking in the door isn’t automatically going to save you money at Costco. To get the most bang for your buck, you need to be strategic. Here are some key ways you can save money at Costco this July.
1. Sign up for a membership before prices go up
If you’ve been on the fence about joining Costco, now’s a good time to stop procrastinating on getting a membership and just do it. Beginning Sept. 1, the cost of a basic (Gold Star) Costco membership will rise from $60 a year to $65, while the cost of an Executive membership will increase from $120 to $130.
Costco’s policy is to refund membership fees if customers change their minds or wind up dissatisfied. So there’s little risk in getting a membership, trying it out for a few months, and seeing how things go. If you wait much longer, though, you’ll be signing up at a higher price point automatically.
2. Upgrade to an Executive membership
An Executive membership at Costco costs double what a basic membership costs. This holds true now and once the above-mentioned fee hikes take effect.
But the Executive membership comes with one huge benefit — the ability to rack up 2% cash back on your Costco purchases. So if you’ve been shopping at the store more frequently than you used to, you may find that the higher-cost membership pays off.
Let’s say you upgrade to an Executive membership now, before prices rise, so you’re paying an extra $60 compared to a basic membership. This means it’ll take $3,000 in Costco spending during the year to break even on that $60 upgrade fee. So if you spend even $1 more than that, you’ve won.
Plus, one lesser-known rule with Executive memberships is that you can downgrade to a basic one if you find you’re not getting your money’s worth. And when you go back to a basic membership, Costco will refund you the difference between the cash back you earned and the cost of your upgrade. So you’re guaranteed to make back your $60 either way.
3. Take advantage of Costco’s flexible return policy
It’s not unusual to make purchases that don’t pan out. Maybe you bought extra swimwear for your kids back in May because you were certain they’d need additional bathing suits, only it’s July and the items you brought home two months ago still have tags on them.
One thing you should know about Costco is that with a few exceptions, you can return any item at any time for any reason. This means you don’t have to cook up an excuse for bringing those bathing suits back 62 days after the fact — Costco doesn’t care. And this way, you can get your money back and use it for other things — even if those other things are different Costco purchases you need at the moment.
We all like saving money. These Costco moves could help you do just that this month, so make them sooner rather than later.
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The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.JPMorgan Chase is an advertising partner of The Ascent, a Motley Fool company. Maurie Backman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Costco Wholesale and JPMorgan Chase. The Motley Fool has a disclosure policy.
