Is a Costco Executive Membership Ever Worth It if You’re Single?

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The less shopping you do, the less an Executive membership at Costco makes sense. But read on to see why getting one when you’re single could easily pay off. 

Being single might lead you to make certain financial choices. If you’re renting a home, for example, you may decide to stick to a one-bedroom apartment rather than pay up for a two-bedroom if you’re the only resident.

Similarly, it stands to reason that if you’re single, you might shop less at a retailer like Costco than someone who’s married and/or has children. A family of five, for instance, might go through three gallons of milk per week, while you might barely finish one.

Now, when it comes to your Costco membership, you have choices. You could pay $60 a year for a basic membership, or you could upgrade to an Executive membership for $120. The latter will give you the benefit of snagging 2% cash back on your Costco purchases — even those made online.

You might assume that an Executive membership won’t make sense if you’re single. After all, how much grocery shopping can one person do? But if you crunch the numbers, you may conclude that an Executive membership actually makes a lot of sense, even if it’s just you who’s using it.

When your upgraded membership pays off

The difference in cost between a basic membership at Costco and an Executive membership is $60. So if you spend $3,000 a year at Costco, you’ll break even on that $60 upgrade. And if you spend more than that, you’ll come out ahead financially.

If you’re single, you may not end up spending $3,000 a year at Costco on purchases like food and toilet paper. But that doesn’t mean you won’t meet that threshold by making other purchases.

Costco sells everything from apparel to furniture to electronics. Most purchases are eligible for 2% cash back under an Executive membership. You can even score cash back if you use Costco’s travel services to book a trip.

So, let’s say you normally spend $100 a month at Costco on snacks, cleaning supplies, and paper towels. That’s only $1,200 a year.

But let’s say you’re also planning to upgrade your laptop this year and buy a new TV for your living room. You might easily spend $1,000 on each. So all told, you’re at $3,200 of spending, which is beyond what you need for an Executive membership to make financial sense.

Similarly, you might only spend $50 a month at Costco on household items because you don’t have a lot of storage space at home. But if you book a $2,500 vacation, that alone could be enough to justify an Executive membership.

Don’t write off an Executive membership just because you’re single

Your anticipated Costco spending should help you decide if an Executive membership is right for you more so than your relationship status. It’s that simple. So if you’re not sure whether to upgrade, keep that $3,000 figure in mind and do your best to estimate your annual Costco spending.

And remember, too, that if you don’t make back your upgrade fee for an Executive membership with your cash back, Costco will let you downgrade to a basic membership and refund you the difference. So the only risk you’re really taking is shelling out the extra money upfront. If you can afford to part with $120 on the spot for a Costco membership versus $60, then you’ve got a really easy decision on your hands.

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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.

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