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Most people know that buying gas at Costco can usually leave more money in their bank accounts. If you’re a Costco member, you have the chance to buy gas for as much as $0.30 per gallon less than the fuel at other stations.
Saving that much per gallon usually means you end up spending a lot less to fuel up than if you went elsewhere. But that’s not the case in every situation. In fact, in these two circumstances, going to Costco to get gas could backfire and you could find yourself with a bigger credit card bill instead of saving money.
1. If your gas visit leads to impulse buys
When you go buy gas at Costco, it can be tempting to pop into the warehouse club to see what’s on sale or what samples are available that day. As you wander through the club, though, you may find yourself putting things in the cart you wouldn’t have purchased otherwise.
Whether it’s some snacks, a seasonal item that you didn’t expect, a cool kitchen gadget, or one of those rotisserie chickens that lure you in, these impulse buys can add up.
That’s especially true because so many of the items you buy at Costco are sold in bulk. If you stop at a regular gas station and toss a bag of chips into your cart, you may be out a dollar or two at most. If you’re at Costco and you impulse buy a variety pack box of Frito Lay chips, you’re looking at around $20 in unplanned spending.
Unless you can be disciplined enough to avoid buying unnecessary items when you go for gas, you may be better off just buying it somewhere else rather than going to Costco and splurging on so many items that you lose the money you saved and then some.
2. If you drive a long distance out of your way to get gas
There’s another scenario where you could find yourself spending more than you save: If you drive well out of your way to get Costco gas instead of going to a station that’s much closer or already on your route.
Let’s say you drive an extra 25 miles round trip to go to Costco in hopes of saving money on gas. If you have an SUV and get 17 miles per gallon, you’ll have wasted around 1.5 gallons of gas or about $5.70 worth of gas depending on the price of gas where you live. If your tank holds 15 gallons of gas and you save $0.30 by buying it at Costco, you’re saving $4.50 but spending $5.70 to drive to Costco — plus you’re wasting your time
Ultimately, you should get gas at Costco if it’s convenient to where you’re going anyway and you can avoid the temptation to buy a ton of stuff at the warehouse club when you get there. Otherwise, your efforts to save by fueling up at the warehouse club could backfire big time.
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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. Christy Bieber 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.
