Costco, the popular American wholesale club, is known for its bulk purchases, discounted prices, and quality products. However, recent data has revealed that the average Costco shopper spends a lot more than previously estimated. Here’s what you need to know to save money on your Costco trips.
The Average Spend-Per-Visit Has Increased
According to Costco’s first and second quarter earnings calls for 2023, the average spend-per-visit has increased by 6.9% and 1.9%, respectively. While this may not come as a surprise to many Costco shoppers, it’s important to keep track of how much you spend to see if you’re saving money or overspending.
The Typical Expenditure Of a Costco Visit
A Costco representative recently revealed that the average Costco shopper spends roughly $150 per order. This is significantly higher than the previous estimate of $100 per visit, which was based on receipts from a small number of customers.
Costco’s competitive prices can be tempting, but it’s important to make a shopping list and decide on a budget beforehand to avoid overspending.
Executive Members Spend and Shop More Than Gold Star Members
Costco’s executive membership includes a 2% annual reward on eligible purchases, of up to $1,000 per year. CFO Richard Galanti revealed in a March earnings call that executive members spend and shop more than Gold Star members.
The breakeven point for an executive membership is $3,000 in annual Costco spending, as it costs $120 compared to the $60 Gold Star membership. By spending a minimum of $3,000, you can receive a cashback of $60, which compensates for the extra cost of an executive membership. The more you spend, the more valuable it is, up to $50,000 in eligible spending, since the reward limit is $1,000 per year.
Using Rewards Credit Cards Can Help Maximize Savings
Costco only accepts Visa credit cards, but there are plenty of Visa rewards cards to choose from. Using a rewards credit card for all your Costco purchases can help you earn cash back or points on your spending.
This is especially useful if you’re an executive member, as the 2% annual reward is in addition to the rewards earned from your credit card.
Sticking to a Shopping List Can Help You Save Money
Costco warehouses have lots of quality, affordable products, which can be tempting to purchase even if they’re not on your shopping list. The free sample stations can also be a source of temptation. However, sticking to a shopping list and avoiding impulse purchases can help you save money. It’s also important to consider the quantities of products you purchase in bulk, as you don’t end up saving money if half the fruit you bought goes bad.
While it’s easy to overspend at Costco, there are ways to maximize your savings. Making a shopping list, deciding on a budget beforehand, and using rewards credit cards can all help you save money. Additionally, considering an executive membership and tracking your spending can help you earn even more rewards. With these tips, you can shop at Costco with confidence knowing that you’re getting a good deal on every trip.
