Is The Costco Executive Membership Worth It?

Have you been considering upgrading to the Costco executive membership?

If you already have a basic membership, then you’re probably well aware of how Costco can help you save money. However, the Costco executive membership can help you save even more, especially if you’re a frequent customer.

The Costco Gold Star Executive membership costs $120 per year and includes two parts: $60 for the base membership plus $60 for the additional benefits and perks.

Below, I’ll compare the Costco membership levels, outline the benefits that executive members can take advantage of, and explain whether or not it’s worth the extra annual membership fee.

What Is The Costco Executive Membership?

If you’re a frequent customer at Costco and are interested in its additional services, the Costco Executive membership can help you save even more money than the standard Gold Star membership.

Here’s a quick outline of some of the key perks that you’ll be able to take advantage of as an executive member:

  • Annual 2% cashback rewards coupon for eligible purchases
  • Discounts on Costco Travel packages
  • Free roadside assistance with eligible products (such as tires and batteries)
  • Savings on Costco services, such as insurance, auto buying, and more

You can sign up or upgrade your existing Costco card online or by visiting the membership counter. Costco members who sign up online should receive their updated Executive membership details emailed to them within 48 hours, so they can begin taking advantage of their benefits.

Costco Membership Fees: Quick Breakdown

If you want to save money on bulk groceries, household essentials, tools, pet supplies, seasonal items, tires, and more, signing up for a Costco membership is one of the smartest decisions you can make.

Although many items at Costco are sold in bulk, the wholesaler also offers a wide selection of non-bulk items as well.

Even if you’re single and don’t need to purchase 10-pound packs of meat and vegetables, you can still take advantage of your membership and use it for non-perishable items, laundry detergent, paper towels, and other items that can be purchased for significantly less than you’d pay at most grocery stores.

It can even be a good way for roommates and university students to save if they’re willing to split the cost of shared items.

Costco currently offers three membership tiers for customers:

  • Costco Gold Star membership (basic membership): $60 per year
  • Costco Business membership: $60 per year
  • Costco Executive membership: $120 per year

The basic Gold Star and Business memberships offer the same base Costco benefits. However, Costco business members can take advantage of exclusive bulk deals for resale and may be exempt from GST/HST sales tax if they hold a reseller’s license (which must be provided when you apply).

Benefits Available To Costco Executive Members

Now that you have a better idea of the Costco membership levels let’s take a few minutes to go over some of the primary benefits of signing up for an executive Costco membership.

1. Annual 2% Reward (Cashback Coupon)

Perhaps the best reason to upgrade to the Executive membership is that you’ll be able to earn cashback on many of your everyday Costco purchases. Although there are some items that are exempt from earning cashback (see below), the majority of Costco purchases allow Executive members to earn 2% cashback.

As you shop throughout the year, your reward will continue to grow. Costco will issue a coupon that can be used in-store about two months before your membership’s expiration date, so you have plenty of time to cash in and use it, even if you don’t plan on renewing your membership.

Here’s how it works:

  • There is an annual cashback rewards limit of $1,000
  • Your cashback is issued as store credit and cannot be redeemed for its actual cash value
  • Your cashback coupon can only be used in-store, not online

While it’s slightly disappointing that you can’t use the cashback coupon online or redeem it for cash (like you can with cashback credit cards), it can still be used to buy free groceries in-store, which is almost as good.

I also like that your money is issued to you in a single lump-sum payment. It’s like Christmas morning for responsible adults.

In other words, if you spend $6,000 per year on eligible purchases at Costco, your $120 membership will pay for itself.

The average family of four in Canada spends over $16,000 per year on groceries, so this shouldn’t be hard to accomplish.

Items That Are Excluded From The 2% Cashback Reward Coupon

Most of your everyday items, such as groceries and household supplies, purchased in-store at a Costco warehouse qualify for the 2% cashback coupon. However, there are some exceptions, including:

  • Alcohol and cigarettes
  • Prescription drugs
  • Gasoline
  • Food court items
  • Costco gift cards
  • Optical exams
  • Costco insurance (and other services)
  • Payments made toward membership fees

You can view the full list here on Costco’s website.

Pro-Tip: Combine With A Cashback Card To Save Even More

If you want to save even more money at Costco, consider using a cashback rewards card for your purchases. For example, if your card offers 1.5% cashback on everyday purchases, then you’d technically be getting 3.5% cashback when stacked with the 2% you’re collecting with your Executive membership. Keep in mind that Costco only accepts Mastercard credit cards at this time.

One word of advice here – Costco is NOT categorized as a grocery store by credit cards. Instead, it’s classified as a wholesale warehouse.

For example, if your credit card offers 2% cashback on grocery purchases and 1% cashback on “all other purchases,” your Costco expenses will only qualify for the latter reward.

If you want to get the maximum cashback savings from Costco, consider applying for the CIBC Costco Mastercard. This card offers exclusive savings at Costco in addition to cashback on non-Costco purchases of fuel, groceries, and restaurants.

2. Free Household Card

As a Costco executive member, you’ll receive one free household card that can be used by a family member living in your home. They’ll be able to use this card to shop at Costco warehouses or to purchase Costco fuel at pump stations.

This card is linked to the same account as the main account holder and will have their name on it as well as their saved payment methods. To add a household member, you’ll both need to visit the membership counter at your local Costco warehouse.

From here, they’ll need to present proof that they live in the same house by providing one of the following:

  • A utility bill in their name
  • A bank statement
  • Government ID or driver’s license

Note – the household card can only be used by household members living at your address, such as your spouse or a roommate. They must also be over the age of 16.

3. Lower-Cost Auto Buying

The Costco Auto Program offers exclusive members-only pricing on a wide range of vehicles, which could save executive members significantly more compared to shopping at a major dealership or used car dealer.

The program can also incorporate any available manufacturer incentives (the same offered by dealerships) to help you save even more. Some dealerships, such as GM and Volvo, also offer preferred pricing for eligible Costco members in Canada.

Keep in mind that the Costco Auto Program isn’t available year-round, though. It usually revolves around its network of affiliated dealers and the sales promotions they’re offering.

Although I’ve never personally purchased a car through Costco, I’ve heard that the prices are quite fair and customer service is very reliable when it comes to dealing with any post-purchase issues.

4. Discounted Costco Insurance And Services

Whenever you’re tempted to think, “Costco doesn’t offer that,” – think again.

As part of the wholesaler’s extended services, Costco acts as an insurance broker for major insurers. For example:

  • Manulife: Term life, health/dental, travel insurance
  • Inova: Home and auto insurance
  • Pets + Us: Pet insurance

Costco executive members receive preferred pricing on insurance, which can help them get better coverage at a more affordable rate than going directly through the insurance company.

Aside from insurance, Costco also partners with several other major Canadian companies to offer discounted rates and preferred pricing for:

  • Rogers and Bell: Phones and phone plans
  • Primus: Internet and phone plans
  • Deluxe: Business payroll and cheque printing services
  • Cube It: Storage units and portable home units
  • ShipTime: Express courier shipping
  • Mike Holmes Inspections: Home inspection services
  • Elavon: Payment processing for businesses

Periodically, Costco adds new partners to its list of services or switches brands, so it’s a good idea for Executive members to get a quote from Costco before comparing rates directly from the companies.

Related Reading: Cheap Phone Plans in Canada

5. Costco Travel Savings

If you’re one of Canada’s many “snowbirds” who enjoys spending the harsh winter in more favourable climates, Costco Travel can help you save money on package vacation deals to the US, Caribbean islands, Mexico, and even overseas.

Costco is partnered with a number of airlines and resorts, and customers may receive preferred pricing and bundle deals by booking through Costco’s travel service.

Although Costco Travel is available with the standard Gold Star membership, you’ll receive special perks and additional savings with your Executive membership, such as:

  • Reduced fees for spa treatments
  • Lower-cost upgrades for plane seats or hotel rooms
  • Credit for room service and other amenities

6. Costco Connection Magazine Included

This one probably isn’t all that interesting for most people, but it’s still worth mentioning, as it’s an important part of Costco’s brand image and customer engagement strategy.

Executive membership plans feature a free monthly subscription to the Costco Connection Magazine, which includes content like:

  • Special in-store coupons
  • Recipes and cooking ideas
  • Editorial articles
  • Travel content
  • Costco’s latest deals and new products

7. Prorated Upgrade Fee

If you want to upgrade your existing membership from a Gold Star or Business membership to an Executive membership, your fee will be prorated based on how many months you have left in your existing membership plan.

This may allow you to upgrade for less if you’re signing up halfway through the year, as your existing membership payments will be applied to your upgraded Executive membership.

You’ll be charged the full $120 Executive membership fee the following year on your account’s annual renewal date.

Costco Cracking Down On Unauthorized Users

In mid-2023, Costco announced that it would begin cracking down on unauthorized users in Canada and begin issuing permanent bans to members caught violating Costco’s card-sharing policy.

Costco is pretty clear when it comes to card-sharing – household card users must live in the same address as the primary member.

Cashiers at Costco stores have started randomly checking shoppers’ IDs to verify that their official address matches the address on file for the primary account holder. If you want to keep your membership, I would caution against sharing your card with anybody outside of your house.

If you want to shop with your friends and family outside of your home, you’re still allowed to bring up to two additional guests, provided that the items are purchased on your account. You’ll just have to have your guests pay you back.

Can You Use Your Canadian Costco Card In The US?

Although most members have a favourite local Costco they enjoy shopping at, you’re not limited to your home location. No matter which level of Costco membership you sign up for, you’ll be able to use your card or the Costco app to access any one of Costco’s 858 locations in Canada, the US, or even overseas.

Will Costco Increase Its Prices?

In March 2023, after the company released its first-quarter earnings, Costco CFO Richard Galanti announced that the company plans on increasing its membership fees slightly, as executives feel that it’s in a competitive position and offers great deals.

At the time of writing, though, these changes have yet to go into effect. Galanti left the statement open-ended, simply stating that “We’ll let you know.”

Is It Worth Getting The Executive Membership At Costco?

If you’re single and don’t shop at Costco very often, an Executive membership may not be worth the extra $60 per year.

However, if you spend several thousand dollars or more at Costco every year, the 2% cashback rewards coupon alone may be enough to help you cover the additional cost of membership (with credit leftover to spare), while also giving you access to exclusive Executive membership perks and benefits.

Looking for the ultimate way to “hack” Costco and save even more? Check out my guide to Costco’s pricing codes next!

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Author Bio - Christopher Liew is a CFA Charterholder with 11 years of finance experience and the creator of Read about how he quit his 6-figure salary career to travel the world here.

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