You’ve probably experienced this before: an employee asks to see your membership card when you’re wrapping up your Costco shopping trip. But they’re not just checking if you’re a member – they’re trying to upsell you to an Executive Membership.
Deciding whether to upgrade on the spot can be tricky, but we’re here to help determine if the Executive Membership is right for you. As Executive Members for over ten years, we’ve done the math and feel we can discuss the benefits and drawbacks. It’s great, but it’s not for everyone.
Let’s get to it.
If you spend at least $250 per month (or $3,000 per year) at Costco, the cashback alone covers the extra cost of the Executive Membership. Market Research company Numerator says the average customer spends $3,078 annually.
What’s the Difference Between Costco’s Gold Star and Executive Membership?
Costco operates on slim margins (12.7% versus 24.6% for Walmart, according to Yahoo Finance), so membership fees are a significant source of revenue for the warehouse giant.
For non-business members, there are two membership tiers: Gold Star and Executive.
🔑 The Gold Star Membership is the standard option, priced at $65 annually. It includes two membership cards and full access to the warehouse and online shopping.
🔑 On the other hand, the Executive Membership costs $130 per year. You’ve probably been asked to upgrade while waiting at checkout because each store has a monthly sign-up quota, and management is motivated to hit those targets.
Why Upgrade to Executive?
So, why upgrade? The main perk of the Executive Membership is the 2% cashback on most purchases, up to a maximum of $1,250 per year. This even includes Costco Travel bookings!
You cover the entire membership cost if you spend $500 a month or $6,000 a year. If you aren’t sure of your annual spending, search your credit card statement for Costco purchases or view your receipts on the Costco app.
But the benefits don’t stop there. As an Executive member, you also gain access to exclusive Costco services like:
- Auto and Home Insurance
- Pet Insurance
- Bottled Water Delivery for home or office
- Personal and business checks
- Payment processing solutions for businesses
- Costco Auto Program
How Does Cash Back on Purchases Work?
Executive Members don’t receive their rewards as cash. Instead, Costco issues a check members can use for future purchases. These reward checks are sent out annually along with your membership renewal notice. But, if your reward is less than a dollar, a check won’t be issued.
Who Should Upgrade to Costco Executive Membership?
The Executive Membership might be a great fit for you if:
- You plan on booking a trip through Costco Travel.
- You regularly spend at least $250 a month at Costco.
- You plan on renewing your membership since the 2% reward must be used on Costco merchandise.
Simply put, upgrading to Executive might be worth it if your Costco shopping style lines up with these perks.
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