Is Costco Executive Membership Worth The Extra $60 Per Year? [Updated 2020]

I have been a Costco member for a long time.  My wife and I save a ton of money buying stuff at Costo.  We had been a Gold Star Member ever since we joined Costco but a few years ago, we upgraded to an Executive membership.  The only regret we have is that we didn’t switch to an Executive membership earlier.

Membership Options at Costco

Costo offers two membership options – Gold Star and Executive

Gold Star Membership

Cost – $60 per year
No cash back rewards

Executive Membership

Costs – $120 per year.
Offers cash back rewards and other benefits.

Both memberships give you access to all Costco locations.

What is the difference between a Gold Star and Executive Membership?

Gold Star membership does not have any cashback rewards

Executive membership offers the following benefits.

  1. An annual 2% reward on eligible Costco purchases including travel.  Total rewards are capped at $1,000 per year
  2. Additional benefits and greater savings on Costco Services (eg. insurance)
  3. Extra benefits on select Costco Travel products

The reward is issued in the form of a reward certificate three months prior to the renewal date of your membership.

Is it worth upgrading to an Executive membership?

If you spend $3000 per year in Costco purchases, it is worth it

With 2% cash rewards, you will need to spend $3000 annually to break even – that is $250 per month. That may be a high bar for some people.  But if you switch to buying more at Costco, it will be worth the upgrade.

We book our vacations through Costco travel.  We also book our rental cars through Costco.  These, along with our grocery purchases and filling up gas at Costco easily help us meet the $3000 break-even.

If you upgrade to the Executive membership and don’t meet your threshold, you may be able to get a refund on your upgrade cost of $60.

Costco says “We offer a 100% satisfaction guarantee and will cancel and refund membership fees at any time if a member is dissatisfied.”

I know of people that have received a refund after they failed to meet the $3000 spending threshold but check with the Costco membership desk before you upgrade.

Executive membership also can offer big discounts on home and auto insurance, and travel packages.

Compare prices on your regular purchases

Compare Costco prices on the items you regularly purchase against other stores.  In most cases, you will find that Costco offers better deals.  This will justify any membership fee you pay Costco.

For example, in my area, Costco gas is at least $0.20 cheaper per gallon compared to other gas stations. with 2 cars, my wife and I drive about 30,000 miles.  That’s $60 in annual savings, which alone pays for a Gold Star membership.

You can get these lower prices with just a Gold Star membership. Executive membership is not necessary if you are just shopping for grocery and gas, and don’t expect to meet the $3000 annual break-even limit.

Costco Credit Card Rewards

Costco Anywhere Visa Card by Citi gives you 4% cash back on gas, 3% cash back on restaurants, and travel,  2% cash back on  Costco purchases and 1% cash back on all other purchases.  The card has no annual fee and no foreign transaction fees.

You don’t have to be an Executive member to get these credit card rewards, a Gold Star membership is sufficient.  But having the Costco Anywhere Visa Card gives you an incentive to purchase more at Costco while giving you excellent rewards.

Value of A Costco Membership

Is an Executive membership upgrade worth it?  Or are you happy with the standard Gold membership?

 

 

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