11 Huge Mistakes Costing You Money At Costco

According to a Gallup poll, the last three years have been rough on Americans, and the consensus seems to point toward inflation. Between 2021 and 2022, 32% of Americans saw inflation as a major negative impact on their household finances. Between 2022 and 2023 that rose to 35%. In the last year up until 2024, that has inched up again to 41%. All three years point to inflation as being a primary concern of Americans, even surpassing the 2008 financial crisis when 18% blamed inflation as the cause of economic woes. With the cost of living making life difficult for almost half of people polled, it makes sense that stores like Costco are more popular than ever.

Statista found the percentage of Americans between the ages 18 to 49 spend up to 27% of their grocery trips at Costco, while people 50 years old and over spent less time there. That means that Costco runs make up around a quarter of Gen Z and Millennial grocery store visits. According to Numerator, 88% of Costco shoppers tend to go back, with the highest percentage of expenditures going toward food and online purchases. Annually, that expense averages around $3,078. That said, there are huge mistakes you might be making that could lower that amount. With some of the big changes being made to the cost of Costco membership, you should want to find every advantage you can get.

Birthdays, anniversaries, and Christmas are unavoidable, and potentially more expensive than they need to be when not well thought out. With discounts on gift cards of anywhere from 20% to 35%, and you don't even need to go to the store to get them since digital cards can be purchased online and delivered to your inbox. In our opinion, if you don't require a physical card, you're probably better off. We've given readers a few good reasons to not keep gift cards in your wallet or purse, and buying gift cards from a store's display rack could get you scammed. Although an executive membership is about to be more expensive for new members, it still offers the benefit of 2% back on Costco purchases of gift cards. That's an extra 2% on top of the 20% to 35% discount you already get and works for both online and in-store gift card purchases.

Add a decent cash back credit card to the mix. For example, the Wells Fargo Active Cash Card offers unlimited rewards of 2% with a welcome bonus of $200 in cash rewards if you spend $500 in three months. Best of all, your credit card cash back benefits are cumulative with your gift card benefits. That means the 2% in Executive rewards can be stacked with the 2% credit card rewards which, when combined with the 20% to 35% discount is equivalent to major savings at Costco. 

Downloading the Costco app may seem like a hassle, but not doing it will cost you in the long run. Where store purchases are concerned, the app can direct you to in-store and online sales specifically related to Costco's Treasure Hunt, What's New, While Supplies Last, and New Lower Prices categories. This makes it easy to compile a list of all your deals in one easy-to-find place. To that last point, you can create shopping lists for your next Costco visit in the app that also gives you the ability to check for the availability of products. If you're trying to maintain a budget, the app storage of your past receipts may make it easier to keep track of your spending. It may also come in handy for tax time if you're making purchases as an entrepreneur related to your business. The app can help you stay abreast of how you're doing as far as rewards points go, including the ability to let you know how close you are to your $1,250 maximum in annual rewards.

Aside from in-store purchases, the app can also direct you to the nearest Costco gas station, even letting you know the price of premium and regular gas before you arrive. The app also acts as proof of membership which means you don't have to carry your membership card with you everywhere and limits the possibility of losing it. 

If you're going to have a Costco membership you might as well go with the tier with the greatest overall financial benefit. A $130 annual fee is the equivalent of $10.83 per month. If we go with Numerator's $3,078 estimate of the average annual Costco spend divided by 12 months, that's roughly $256 per month. At Costco, that's the equivalent of $60 per year in rewards. You may be thinking that's not worth the cost of membership. However, consider that if you make those purchases with a cash back credit card offering 2% or more you can double that amount in rewards. According to AAA, the average price of gas in the U.S. is $3.22, while the average price of gas at Costco is an average $0.28 per gallon cheaper, the equivalent of $116.76 in annual savings. Right there your membership has already paid for itself, but add up 2% back on vacations booked through Costco Travel and pricey prescriptions, the executive membership makes more sense. Of course, if you have a large family, buying in bulk will save you money anyway, but the more you spend, the higher rewards you get back. This makes an executive membership a necessity for households or businesses spending $500 or more per month at Costco. 

If you're not buying electronics at Costco you could be making a costly mistake. Aside from the standard 2% cash back you earn on electronics purchases — not to mention the additional rewards earned on a cash back credit card like the Citi Custom Cash Card offering up to 5% cash back on up to $500 worth of purchases — there's the outstanding extended warranties on offer that can go up to two years on average. Planned obsolescence is when a manufacturer intentionally builds a product to break down, which is usually right around the time an upgraded version of the product is planned to enter the market, making an extended warranty something that could save you more money in the long run. A 90-day return policy sweetens the deal by allowing you to bring back items for a full refund if you end up feeling buyer's remorse. This is as much as Best Buy's 60-day Plus membership return and Amazon's 30-day return window put together.

Tech support is also free and unlimited, so when you need help with your new equipment you can get it without paying more for the assistance. Costco runs a number of sales on electronics with deep discounts that you can stay on top of with sites like Costco Insider and Costco97, or viewing weekly promotions and the special events calendar in the Costco app. 

If you're in the market to travel, check out the offerings on Costco Travel first. Costco Travel provides members with less expensive options covering hotels, flights and transportation rentals if needed. Costco leverages its relationships with travel service providers to find the best price available for your trip, and even trains travel agents and professionals to provide members with the best possible advice. Like any other purchase at Costco, travel purchases are eligible for 2% cash back, in addition to the rewards provided by your credit card provider. Since these services are provided by travel professionals, your vacations can even be fully arranged through bundled, all-inclusive packages, which takes the pressure off of you to figure out all the essentials.

Allianz Partners USA projected Americans will spend upwards of $221 billion on travel in 2024, a 118% increase from 2019, and a 3.5% increase from 2023. Travelers will likely spend $2,834 per household in order to have those vacations. The Ascent researched comparisons of travel costs between Costco Travel and other booking services andfound that vacations booked through Costco were, on average, 10% less expensive than through other booking services. Assuming you book your travel using a cash back credit card of at least 2%, plus the 2% your Costco membership provides, that's a saving of 14%. Using Allianz Partners' estimate of $2,834, that would be the equivalent of $396.76. 

Like most things in life, when you do things can be as important as how you do it. One of the worst days to shop at Costco is on Mondays since it's the day when the weekend crowds tend to make use of Costco's generous return policy. Speaking of the weekend, if you aren't a big fan of crowds, you definitely need to stay away from Saturday or Sunday shopping. Most people think they have an original idea, only to discover that a whole lot of other people are thinking the same way. A lunchtime Costco run may sound like a good idea, but just know a lot of other people are likely thinking the same thing. Seasonally, it should come as no surprise that December around the holiday season is going to be very busy at Costco, so we suggest you think ahead or use online shopping services where possible.

So here's when you should go to Costco. Early weekday mornings, just as the deals hit the shelves, or during inclement weather when most people want to just be at home are your best times to avoid crowds. Pop in the last hour before the store closes when most people are just grabbing last minute items quickly. Be sure to align your shopping strategy with the weekly offers so you can avoid crowds and save money while you're at it. Time is money. Don't waste yours standing in line. 

Here's why it's a bad idea to shop on an empty stomach. The Dole Food Company conducted a survey and found 76% of respondents admitted they were more likely to spend more money during shopping when they were hungry, with 62% of people even stating they could spend as much as 20% more than they budgeted on groceries for the week. While 79% of shoppers surveyed said they were less likely to overspend if they had a grocery list, it's safe to assume suffering pangs of hunger in a food aisle may significantly alter the impact of that list.

Aside from the issue of overspending on food, is what happens to that food once you bring it home. Recycle Track Systems research found that the U.S. tosses away 60 to 120 billion tons of food every year, the equivalent of 40% of the nation's food supply or $218 billion worth of food. Impulse shopping combined with misunderstood best before and expiry dates lead to a massive dumping off perfectly good food. If you're buying more food than you can actually swallow in a reasonable amount of time and throwing out any of it, you're essentially throwing your money into the trash. How much money? According to the study, on average, Americans throw out $1,600 worth of produce alone per year.

While Costco's brand is synonymous with saving in bulk, one of the biggest mistakes you can make is always assuming that's where you'll find the best deal. While buying in bulk can make sense for certain purchases, it can absolutely lead to some of the food waste issues mentioned in the last slide. If you live alone for instance, buying that colossal bag of frozen berries that you'll be opening and closing over the next four weeks may not be that frugal, especially when it falls victim to freezer burn halfway through the bag and you have to throw it out. Same for unfrozen items with shorter shelf lives like bananas or bread, where buying more than you can eat in a reasonable amount of time will take you down the road to food waste. Large tubs of condiments like mayonnaise and mustard can also go bad before you get through them, which just becomes money going into the garbage.

While electronics won't necessarily spoil any time soon, and Costco does offer a lot of great deals on electronics a few times a year, something Costco doesn't do is price match. This is an opportunity for you to leverage the Costco price against the pricing of a store that does price match, like a Best Buy. If all else fails, you may be able to find a refurbished model of the Costco item elsewhere for less money.

Now, while Costco doesn't price match with other stores, Costco does have a pretty useful price adjustment policy for in-store purchases that can save you a buck. If you're a Costco member who purchases an item from the store only to find that the item in question is discounted after the fact, Costco is obligated to give you the difference from the sales price. The small print here is this is possible so long as you request a price adjustment within 30 days of your purchase. You also can't apply the price adjustment policy between online purchases and warehouse purchases. This is also up to the sole discretion of the store you frequent, so you'll want to be sure you pay attention to the rules before you think about price matching something you've bought. It should also be noted that you can only price match an item from the store you originally purchased the item from.

If you want to ask for a price adjustment, you'll have to fill out a price adjustment request form on the Costco website and wait for the approval. Once approved, you should get a credit for the difference in sale price within five to 10 days. Costco Shop Cards have a shorter time window for price adjustment claims, giving you eligibility for 14 days before or after a promotion.

Much like the price adjustment policy, the return policy is something that ultimately saves you money in the long run. Practically speaking, the ability to take something back and get your money back after an impulse buy or realizing the product is defective is a huge win. Unlike a lot of retailers, you can still return items even without a receipt. Obviously, a receipt makes that easier, but a membership comes with privileges that include a record of your account and purchases. You have the option of returning an item directly to the warehouse or sending the item back through the mail by parcel. This includes most electronics like smartphones, audiovisual products, and computers. There's also a wide variety of acceptable reasons for you to return or be compensated for your item, including loss, damage, or just deciding after the fact you don't want it for any reason.

Electronics can be returned within 90 days of purchasing or receiving your product. Jewelry, specifically diamonds one karat or more are also refundable so long as you have the paperwork that came with the jewelry and after a Costco gemologist inspects the diamond. That said, don't expect to get returns on precious metals, Costco Shop cards, gift cards, alcohol, travel, live entertainment tickets, or tobacco. Also, some items like batteries that have depleting shelf lives have their own product specific return policies which you should be aware of before you purchase them.

Once you figure out if you should buy a new, used, or leased vehicle, if you're a member of Costco's wholesale club, you're automatically eligible to utilize the Costco Auto program. As one of the top three sellers of vehicles in America, Costco Auto has relationships with over 3,000 car dealerships across the country, making it possible to buy new and used vehicles from trained and vetted Costco authorized dealers. In order to be considered for this role, participating dealers must agree to undergo special training through Costco, and have worked and been regularly evaluated at their dealership for at least six months. Costco takes customer service so seriously that it's been known to send Costco employees to dealerships as moles for the stores.

Browse for vehicles through the Costco Auto Program website for additional savings on vehicles provided through their vetted dealers. You can even get information like vehicle reviews, rebates, and comparisons of leased versus new vehicles. Aside from savings on the vehicle, you may also get discounts on repair and maintenance services, extended warranties, and limited time — typically 60 day — specials in collaboration with the dealership.