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Thinking of getting an executive membership at Costco? Read on to learn a few crucial details about this membership level.
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Shopping at Costco is a great way to save money on everything from groceries to apparel to household products. And if you upgrade to an executive membership at Costco, you may find you’re able to save even more.
A Costco executive membership costs $120 a year, which is double the cost of a basic membership. In exchange, you get 2% cash back at Costco, which is a pretty sweet deal. In fact, your cash back could be enough to pay for your upgraded membership and then some.
But if you’re thinking about upgrading your membership at Costco, it’s important to know how the program works. Here are a few things you may not have known about a Costco executive membership.
1. You’re limited to a $1,000 reward each year
If you shop at Costco frequently enough, you might manage to rack up a lot of cash back from your executive membership. But you should know that once you’ve accumulated $1,000 via executive membership cash back, you’re done for the year.
That said, to even get to the point of being eligible for a $1,000 cash back reward from your executive membership, you’d need to spend $50,000 a year at Costco. That’s probably way more than you can imagine yourself spending, even if you have a year when you use Costco to do things like book travel and update your furniture.
2. Online purchases count
Although Costco carries an impressive selection of inventory in its warehouse club stores, you might find even more items to choose from online. The good news is that online purchases are generally eligible for 2% back if you have an executive membership, so don’t be concerned that those orders won’t count.
3. Car purchases aren’t eligible for cash back
In some cases, it could pay to purchase your next vehicle via Costco. But unfortunately, your car purchase will not be eligible for the cash back rewards that are part of an executive membership. (If they were, then hitting that $1,000 limit would probably be easier.) However, there are still many perks to buying a car through Costco, such as saving money on your purchase price, so it pays to see what models are available through this program.
Should you get a Costco executive membership?
A Costco executive membership certainly isn’t right for everyone. If you don’t do a lot of shopping at Costco, then it may not be worth it to pay the extra $60 a year. But either way, read up on how the upgraded membership works and the benefits it offers before making your decision.
Remember, too, that Costco wants you to be happy with your executive membership. If you do the upgrade and find that it isn’t worth it, you can always downgrade your membership to a basic one and ask for a refund. It’s not as though you’re stuck with the costlier membership once you decide to make that upgrade, so it’s really a pretty risk-free proposition if you want to give it a try.
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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.Maurie Backman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Costco Wholesale. The Motley Fool has a disclosure policy.
