Is a Costco Membership Worth It? (In Canada) - Genymoney.ca (2024)

I had a Costco membership many years back and let it lapse. Then there was a Costco membership deal and I jointed the club again. We’ve been Costco members since we became a family of four, which was a few years ago now. Amidst trying to find a parking spot and trying to avoid the meandering and leisurely Costco shoppers as I make a beeline for the $7.99 rotisserie chicken, sometimes I wonder is a Costco membership worth it?

Is A COstco Membership Worth It?

Here’s what I think. This post will go over the two types of Costco memberships, what some of the benefits are, how to get a membership deal (and what some of the deals are), the generous Costco return policy, and things you don’t need a membership for.

How Much is A Costco Membership in Canada?

There are two membership options with Costco, the Executive and Gold Star membership:

Costco Executive Membership

• $120 annually for the Executive Membership
• 2% cash back up to $1000 and this is rewarded annually about two months before your Executive membership is set to expire

Costco Gold Star Membership

• The cost for the Gold Star is $60 annually

You may have heard that Costco makes their money mainly from membership fees. In fact, over 70% of Costco’s profit is just from membership fees alone.

Once you become a Costco member, you will likely continue to become a Costco member. Costco has a 90% renewal rate.

Costco Membership Benefits in Canada

Here are some of the Costco membership benefits in Canada:

• For both Executive and Gold Star membership you can shop at Costco and online at Costco.ca
• Two membership cards for the same address are given
• The Executive membership gives you 2% back on warehouse, Costco.ca, and Costco travel purchases.
• You can use your Costco card at 600 international locations worldwide. This is great if you are a Canadian snowbird, or go to Hawaii’s busy Costco to grocery shop for the few weeks that you are on tropical vacation.
• Additionally, Costco benefits include access to Costco Optical and Costco’s Tire Centre (high quality tires) and also Costco’s Hearing Aid Centre.
• Finally, another benefit is access to Costco Travel
• Eligibility to sign up for the new CIBC Costco Cash back Mastercard
  • $0 annual fee
  • 3% cash back at restaurants and Costco gas stations
  • 2% cash back at other gas stations and Costco.ca
  • 1% cash back for all other purchases including purchases at Costco warehouse
  • An annual cash back gift certificate is rewarded and can be used at Costco warehouses

Costco Membership Deal Canada

Costco membership deals don’t come by too often, but when there is it is usually a discount for a minimum purchase on Costco.ca if you renew your Costco membership. You can check the Costco membership offers page for updated Costco membership deals.

If you are a student and sign up for a Costco membership, you can get $100 off your $250 Costco.ca purchase through Student Beans verification of your student status.

This is not a deal per se, but if you are not satisfied with your Costco membership, you can get 100% of it refunded. Costco stands by their 100% satisfaction guarantee.

Costco Price Comparison

Is a Costco membership worth it?

There are some things that are hands down always the best price at Costco, and some things that aren’t.

You need to be able to calculate the unit price in order to compare.

If you shop sales at other Canadian grocers you will likely be able to get the same price as Costco or cheaper than Costco. When Costco has sales though, the prices at Costco are pretty bottom line.

There are some things that are usually not priced well at Costco, I find that these are apples, tomatoes and in general, produce (except for the bagged spinach, they are usually a great price). They are usually more economical at other places.

That being said, Costco’s produce lasts a long time and is very high quality. It’s not like you have to eat it within a few hours otherwise it would go bad.

Here are a few examples of how sometimes Costco can be pricier than the other places but when there are sales, they are almost unbeatable:

I like to check Red Flag Deal’s Hot Deals forums before I head to Costco to make sure it will be worth the trip. That Deal Guy (someone called VanSave for Costco West) posts pictures of each Costco item and uploads them.

If I see for example, Palmolive 7L for $7.99 I will try and make a trip to Costco before that deal is over if I need dish soap. Bless their heart for spending the time to upload pictures almost each week!

In general, Costco does scream value because they limit their mark up to just 15%. Their profit margins are low for their products.

Also, Costco participates in the Scanning Code of Practice in Canada (or SCOP Costco).

Costco Is Worth It If You Have The Space

Another caveat to consider before you take the plunge on membership is whether you have the space in your home.

You need storage space for Costco. Storage space in the freezer, and storage space on your shelves, hard to have if you live in a one bedroom apartment with a baby.

If you don’t have the space to store the Costco sized products, Costco will probably not be worth it for you. For non-perishable items, for example, I stock up when it is on sale at Costco. Hand soap, dish soap, dishwashing tabs, laundry detergent, Mr. Clean Erasers…these are all items that won’t go bad.

If you buy Costco sized perishable products and end up throwing most of it away as food waste, getting membership will not help you save money on groceries.

For example, the large carton of Costco croissants is a Costco staple for us but it has a short best before date.

However, not even a family of four can eat 12+ croissants within two days (that’s the best before date marked on the container of croissants usually).

I usually put most of them in a freezer bag, pop them in the freezer, and take them out and put them in the air fryer (and this lasts us well over a month since we don’t eat butter-laced croissants daily).

Costco Kirkland Products

It is well known that Costco’s signature brand, Kirkland, has very high quality products (if not he same as leading national name brands). Here are 15 Costco Kirkland products in Canada that you should be buying.

We always buy the Costco Nut Bars, no wonder I am a fan, since they are the same manufacturer as the LeClerc celebration cookies.

Duracell, Starbucks, Huggies are some other brands whose quality is enmeshed within the respective Kirkland products of batteries, coffee, and baby wipes. Same quality, but just hidden behind the Kirkland’s brand instead.

Costco Return Policy in Canada

Costco has an excellent return policy. Although it says on Costco’s website that you bring the item within 30 days of purchase with a Costco receipt if you are dissatisfied, they will accept items older than 30 days.

Basically any time that you are not satisfied with the item you can return it, and you don’t need your receipt (but it will help speed up the return process).

The only exception to this no limit return date is electronics. Electronics has a 90 day return policy. Electronics are items like televisions, dishwashers, and smartwatches.

The lines can be a bit blurred though. Is a smart vacuum an electronic?

For example, if you were not happy with the iRobot Roomba i4 vacuum, you can return it any time (yes even a few years later), as it is not considered an electronic but a vacuum. We bought our iRobot from Costco and have been very happy with it, “Bobby” helps clean the home every Sunday. We even found a partner for our vacuum from Costco, Betty, the iRobot Braava Jet Robot Mop.

Another Costco item that has a more stringent return policy are diamonds. If the diamond you bought from Costco is more than 1.00 carat in size, you have to bring back the original paperwork and it will be inspected to make sure it is authentic before the return is accepted.

The downside with this generous return policy is that sometimes the Costco returns line is very long and you’ll need to bring some patience with you when you do your return.

Things You Don’t Need A Costco Membership For

There are certain things you don’t need to have a Costco membership for.

You don’t need a Costco membership for the Costco food court. Yes, that $1.50 hot dog and a drink doesn’t require you to pay for a membership fee to enjoy it.

The $1.50 hot dog combo is inflation proof and has been the same price since 1985 (though it’s likely not heart attack proof) as the Costco founder Jim Sinegal had told the current CEO that if he raised the price of the hot dog he would kill him.

Even with Vancouver’s single cup $0.25 fee, Vancouver Costco’s hot dog combo remained at $1.50. Thankfully the Vancouver single cup fee will be eliminated in 2023.

You also don’t need a Costco membership to pick up your prescription medications from Costco pharmacy. Costco pharmacy has the lowest dispensing fees in town, the dispensing fee on average in the first 3 months of 2018 is $4.35, compared to $12.15 for Rexall or Safeway, according to CINUP.

You don’t need a membership if you have a Costco Shop card

If you have a Costco shop card you can buy things at Costco without a membership. The annoying this is that you’ll have to go to the Membership Counter and register for a one-day shopping pass.

If the value of your Costco purchase is more than the value of the Costco Shop card, the remaining balance has to be paid by cash, debit, or Mastercard.

Is A Costco Membership Worth It: Verdict

If you have a family I think Costco is worth it, especially the Gold Star Membership. You can’t do all your shopping there (e.g. it’s not a one stop shop) but I go infrequently, about once every month or every two months for certain items.

For the Executive Membership, you will have to spend over $3000 a year to get 2% cash back which is $60. This is equivalent of the additional cost of the Executive Membership.

You will need to spend $3000 a year to ‘break even’ (this is about $250 a month). If you spend less than this annually on Costco, the Executive Membership is not worth it for you.

I was approached by Costco employees to upgrade my Gold Star to Executive. The pressure they applied for me to sign up for the Executive was intense, and frankly it turned me off. Costco employees seem very happy and satisfied, they don’t receive a commission for selling the Executive membership but do have to try and meet quotas for minimum ‘upgrades’.

If you have a fear of crowds though Costco might not be for you. I haven’t found the optimal time to go to avoid crowds, I believe that it might be best when it first opens (but you have to be quick and not meander around the aisles) and I have heard it is less busy during dinner time.

Finally, in order to shop at Costco, you will need a Mastercard. It does not accept Visa cards. However one way to get around this is to buy Costco shop cards on the Costco.ca website, since Costco.ca accepts Visa cards.

Trung Phan has a great Twitter thread about how Costco uses psychological hacks in its business model to get shoppers to spend money. Spend money they do, in fact, Costco is the WORLD’s third largest retailer by sale.

With the soaring price of groceries and with inflation out of control, buying to stock up on non-perishables is a forward thinking way of saving money fast. However, in order to truly save money at Costco, you have to have nerves of steel and not let impulse purchases get to you (this is easier said than done, I have yet to avoid impulse purchases at Costco).

You might also be interested in:

• Costco hacks to save money
• Rexall Be Well review
• Maximize PC Optimum Points
• How to save on groceries in Canada
• Dollarama deals
• Food inflation in Canada

Do you have a Costco membership?

Do you think a Costco membership is worth it?

You might also be interested in: