A lot of people sure love it — including one personal finance guru.
- Costco is known for its commitment to affordable prices.
- Joining Costco could be one of the savviest financial decisions you make this year, because a membership provides both value and excellent customer service.
Costco is one of those stores where you really don’t know what you’re missing until you start shopping there. And you can’t start shopping there until you start paying for a membership.
The cost of a basic Costco membership right now is $60. An upgraded executive membership will cost you double, but you’ll also get 2% cash back on all Costco purchases you make, kind of like how you might get 2% cash back on a credit card. So if you shop at Costco frequently, an executive membership could make a lot of sense.
Now, if you’re new to Costco, you’ll probably want to start with a basic membership and see how it goes. And if you’ve been feeling iffy about joining Costco, I would absolutely encourage you to spring for a membership, especially if you have a warehouse club store close to your home.
My family routinely saves a large amount of money by shopping at Costco. But don’t just take my word for it. Financial guru Ramit Sethi is a big fan of Costco, too. He even went so far as to tweet about how it’s an amazing business. And here’s why that’s true.
It’s all about value
The reason so many people love Costco boils down to the savings and customer service the warehouse club giant is known for. Not only does Costco make a point to offer competitive prices, but it also goes above and beyond to ensure that customers are satisfied with the items they’ve purchased. And if not, Costco has a very generous refund policy.
Costco is so committed to offering savings that if it can’t do so, it simply won’t put a given item on its shelves. Sethi quoted Jim Sinegal, Costco co-founder and former CEO, in his tweet as having said, “We have to be able to show a savings on everything we sell. If we can’t show a savings we won’t carry it.”
That’s a pretty solid approach to offering value. Many retailers would have no qualms about stocking an item that’s overpriced and making a profit on it. But it’s clear that Costco doesn’t want to work that way.
In fact, if you’re an avid Costco shopper and have ever noticed that some of the products you used to buy there are no longer in stock, a rise in cost could be the reason why. Costco may have pulled those items to avoid a scenario where you’re not getting great value for your money.
A wise financial move
When I first joined Costco, I was skeptical about the savings involved. But now that I’ve been a member for more than a decade, I can say with certainty that shopping at Costco helps me feed my family and maintain my home for less money.
If you’re on the fence about joining Costco, it could pay to spring for a membership, especially at a time when food costs are up so significantly due to inflation. You’re likely to find that your membership more than pays for itself, and that shopping at Costco helps you stretch your income during these economically trying times.
Even if you’re not having a hard time financially, everyone enjoys saving money. And Costco’s core business model is designed to help you do plenty of that.
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