It may come as a shock to the reader, but YoungMoneyFinance has only recently joined Costco, I’ve been a member for about 3 months now. Of course it seems that a personal finance blogger should be all over Costco (or a similar bulk discount store…BJ’s, Sam’s Club), but I held out for a while. A good friend of mine has had a membership for a while, and I’d accompany him occasionally and buy a few things, as his guest. (Don’t worry, he got 2% back on my purchases through his membership). I was pretty skeptical, although some things were a good deal, I didn’t feel the need for just Mrs. MoneyFinance and I to have a year’s supply of toilet paper, or a 6 months supply of honey nut cheerios (trying to lower my cholesterol!). I went back and forth on whether or not I thought it was wise to shop at Costco and decided not to get a membership. Then, 3 months ago, a friend gave us a gift card for a membership and we decided to take the plunge. Here are some of my thoughts on the pros and cons:

Generally I’m saving money.

I’ll go ahead and say that this is probably one of the biggest pros of Costco. Pretty much without fail, I feel confident that if I buy something at Costco, I’m getting a good deal. In classic YMF form, I carefully compared prices on probably 20 of the things we most commonly buy. What we did the first month is first go to Costco and buy a whole bunch of stuff (it was like $300 worth of groceries), and then we went to our normal grocery store (Kroger, if you’re familiar with that store). On the whole, I’d say we were saving 10-25% for each item. That being said, it was typically just a dollar or two cheaper, which means we probably save $50-$75 each month. So, all things considered Costco so far has been pretty good!

Mrs. Money and I don’t have any kids right now, so we’re just shopping for the two of us. Well we’re also shopping for the pup, and his dog food is about 25% cheaper there so he’s definitely a fan. I was pretty skeptical on the quantity of items, since we’re buying in bulk. Of course if you save money buying 50 tangerines but only eat 30 of them before they go bad, are you really saving money? We quickly learned what we could eat of all before it went bad, and stayed away from items that spoiled faster than we could eat/drink them (milk for example).

All in all though, Costco is good because on most items I’ve found, things are cheaper, therefore I am saving money by shopping there.

It takes more time (not as convenient).

Costco is super popular, amongst pretty much everybody. Because of pro #1, it’s a pretty hopping place. On a given Saturday, when it’s the easiest for us to go, it’s a zoo, probably because it’s pretty easy convenient for other people to go too. We easily spend 1.5-2 hours there each time we go. Of course we always have to get gas there, which takes a while, find a parking spot, shopping itself takes a while because it’s a huge building, checking out takes time, walking out takes time, and loading the car takes time with all the boxes they give you. It’s quite the ordeal! Because of this, we only go once per month, and it’s quite the time drain when we do! It’s also a bit stressful going through all of that. So, because of pro #1, we get our first con.

Without a good plan I spend too much.

My 10^th grade civics teacher once said, “you’ll go broke saving money at Costco”. I certainly get where he’s coming from. Costco has this incredible way of getting you to spend more money, all in the name of saving money. “Oh that’s a good deal – let’s get it” (as we buy a year’s supply of ranch dressing). “Oh, we don’t really need an American flag for our front porch but it’s here and it’s a good deal”. They’ve always got new displays, new items, and new samples to try (which although I always get them…it doesn’t make up for all the money I’m saving). The desire to save money leads me to send more money and I end up at the check-out shocked at how much I’ve spent.

To be successful at Costco, it’s important to realize that you don’t need to buy it all. Think through what you actually need and try to just buy those items. Costco is really good at convincing you to buy more stuff – thus eliminating the savings you’ve already saved. So, just figure out what you should buy and what you shouldn’t buy – and stick to it!

It makes budgeting a wee bit more difficult.

If you do it right, buying things at Costco will likely last more than just a month. For example, the protein I buy is $45 at Costco but lasts me 3 months (the regular grocery store protein which lasts a month costs $20). However, I’m paying for the entire protein now, which means I put $45 in this month’s budget. This might be a little overkill but it’s how my mind thinks. It could easily cause you to go over budget in one month but under in another month. So, what have I done to rectify this problem? Depending on the item, I may spread it out over a few months. For example the protein, I might budget $25 this month and $20 the second month. Another option is that one month you’ll buy protein and not buy it the second month but buy frozen beef, which will last me two months in the second month. Still with me? I’m sure you’ll figure out your own system.

All in all I’ve been very pleased with Costco and the money we’ve been able to save! It took a little getting used to, figuring out what we should buy, what we won’t waste, what’s really a good deal and then what’s new to try! Curious to read more about saving time/money? One of the big allures is definitely the cheap gas at Costco, why pay more, especially when the gas station is right there? Check out this article that goes into more detail on getting gas at Costco.

What about you? Are you a member of a discount warehouse store? How has your experience been?

Are you exploring new ways to save money? If Costco doesn’t seem to fit your needs, perhaps consider giving AmazonFresh a free trial: