3 Little-Known Disadvantages of Costco's Executive Membership

Motley Fool11-21 20:00

KEY POINTSAn Executive membership at Costco costs $130 a year vs. $65 for a Gold Star membership, but it offers 2% cash back on purchases.The problem is that not all purchases will score you that cash...

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But read on to learn about some of its drawbacks.","collect":0,"end_time":0,"defaultTopTitle":"fool.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"LU1551013342.USD":"Allianz Income and Growth Cl AMg2 DIS USD","LU2360106947.USD":"BGF NUTRITION \"A4\" (USD) INC","LU2125154778.USD":"ALLSPRING GLOBAL EQUITY ENHANCED INCOME \"A\" (USD) INC","LU2095319765.USD":"Natixis Thematics Subscription Economy R/A USD","LU0471298777.SGD":"Blackrock Nutrition A2 SGD-H","BK4585":"ETF&股票定投概念","LU2360032135.SGD":"ALLSPRING GLOBAL EQUITY ENHANCED INCOME \"A\" (SGDHDG) INC","LU0234572021.USD":"高盛美国核心股票组合Acc","BK4533":"AQR资本管理(全球第二大对冲基金)","LU2210150020.SGD":"Natixis Thematics Subscription Economy R/A SGD","LU0820561909.HKD":"ALLIANZ INCOME AND GROWTH \"AM\" (HKD) INC","LU2125154935.USD":"ALLSPRING (LUX) WF GLOBAL EQUITY ENHANCED INCOME \"I\" (USD) INC","LU0234570918.USD":"高盛全球核心股票组合Acc Close","COST":"好市多","LU1323610961.USD":"UBS (LUX) EQUITY SICAV - LONG TERM THEMES (USD) \"P\" (USD) ACC","LU2237438978.USD":"Amundi Funds US Pioneer A2 (C) USD","LU1069344957.HKD":"AB SICAV I - AMERICAN GROWTH PORTFOLIO \"AD\" (HKD) INC","LU2210149790.SGD":"Natixis Thematics Subscription Economy R/A SGD-H","IE00BZ1G4Q59.USD":"LEGG MASON CLEARBRIDGE US EQUITY SUSTAINABILITY LEADER \"A\"(USD) INC (A)","LU0471298694.HKD":"BGF NUTRITION \"A2\" (HKD) ACC","LU1066051498.USD":"HSBC GIF GLOBAL EQUITY VOLATILITY FOCUSED \"AM2\" (USD) INC","BK4550":"红杉资本持仓","BK4588":"碎股","LU1066053197.SGD":"HSBC GIF GLOBAL EQUITY VOLATILITY FOCUSED \"AM3\" (SGDHDG) INC","LU0689472784.USD":"安联收益及增长基金Cl AM AT Acc","LU0820561818.USD":"安联收益及增长平衡基金Cl AM DIS","BK4155":"大卖场与超市","BK4581":"高盛持仓","LU1551013425.SGD":"Allianz Income and Growth Cl AMg2 DIS H2-SGD","IE00BKVL7J92.USD":"Legg Mason ClearBridge - US Equity Sustainability Leaders A Acc USD","BK4596":"哈里斯概念","LU0256863811.USD":"ALLIANZ US EQUITY \"A\" INC","BK4504":"桥水持仓","LU1496350171.SGD":"FRANKLIN DIVERSIFIED BALANCED \"A\" (SGDHDG) ACC","LU1035775433.USD":"AB SICAV I - AMERICAN GROWTH PORTFOLIO \"AD\" (USD) INC","LU1571399168.USD":"ALLSPRING GLOBAL LONG/SHORT EQUITY \"IP\" (USD) ACC","LU1496350502.SGD":"FRANKLIN DIVERSIFIED DYNAMIC \"A\" (SGDHDG) ACC","IE00B5TLWC47.USD":"BNY MELLON LONG-TERM GLOBAL EQUITY \"B\" (USD) ACC","LU0943347566.SGD":"安联收益及增长平衡基金AM H2-SGD","IE0008368304.USD":"STEWART INVESTORS WORLDWIDE LEADERS SUSTAINABILITY FUND \"I\" (USD) ACC","LU0417517546.SGD":"Allianz US Equity Cl AT Acc SGD","LU0385154629.USD":"贝莱德营养科学基金A2","LU0079474960.USD":"联博美国增长基金A"},"translate_title":"Costco高管会员资格的3个鲜为人知的缺点","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"COST":1},"content_text":"KEY POINTSAn Executive membership at Costco costs $130 a year vs. $65 for a Gold Star membership, but it offers 2% cash back on purchases.The problem is that not all purchases will score you that cash back, and you're limited in how you can use your Executive membership reward.You may also be tempted to overspend knowing you get cash back.When it comes to joining Costco, there are two memberships to choose from. A basic Gold Star membership at Costco costs $65 per year, while an Executive membership costs $130.But there's a big perk to the Executive membership -- earning 2% cash back on purchases. And if you spend $3,250 per year at Costco, which is certainly feasible if you shop there twice a month or more, you make back the $65 upgrade fee. From there, every additional dollar of cash back you earn on your Executive membership is money in your pocket.The Executive membership clearly offers a lot of value, because it's Costco's most popular. But here are a few drawbacks of an Executive membership you should know about.1. Certain purchases aren't eligible for cash backAn Executive membership at Costco will give you cash back on most of the items you buy, including appliances and travel packages. But there are certain purchases that don't qualify for cash back with an Executive membership. These include:GasCigarettesAlcoholStampsFood court mealsCostco Shop Cards (the store's version of a gift card)The good news, though, is that with the right credit card, you can set yourself up for cash back even if your Executive membership won't give you any. Click here for a list of the best credit cards for Costco so you can maximize your rewards.2. There are certain purchases you can't make with your rewards certificateAs an Executive member, you'll be issued a rewards certificate once a year that you can use for purchases at Costco. But there are certain purchases you can't spend your rewards certificate on. These include:GasFood court mealsTravel (though remember, travel bookings earn you cash back)Costco.com purchasesThat said, if you want to use your Executive membership reward for online purchases, you can always redeem it for a Costco Shop Card at a store and then use that Shop Card to check out online.3. You may be tempted to overspend knowing you get cash back on what you're buyingThe nice thing about Costco is that you'll find a wide variety of products for sale under the same roof. But that can also be a bad thing, since it could lead to overspending. And you may be especially inclined to overspend if you have an Executive membership.Because that membership puts cash back in your pocket, you might more easily justify certain impulse buys knowing you'll get a portion of your spending back. But that's not a great line of thinking.If you impulse-buy a $20 sweater you don't need, you're getting $0.40 back with an Executive membership. That's hardly going to soften the blow of an extra $20 charge on your credit card.Costco's Executive membership makes sense for a lot of people. And if you shop at the store regularly, it could very well make sense for you, too. Just keep these pitfalls on your radar if you're going to upgrade your membership. And take steps to work around them, like being savvy with the credit card you use or reminding yourself to stick to a shopping list so you don't go over your budget.","kind":null,"is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"0","news_tag":"","news_rank":0,"symbols":[],"gpt_button":0},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.29.1","shortVersion":"4.29.1","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2485493057"}