Whether the Costco Executive Membership is Worth it

I am frequently asked whether the Costco Executive Membership is worth it compared to the regular Gold Membership, so I thought I’d calculate the break even point. 

First of all, the Gold Star Membership costs $55, but without any rewards. The Executive Membership costs $110 to sign up. So we are essentially talking about a $55 price difference. Gold members do not receive any sort of rewards; conversely, Executive Members get 2% cash back on all purchases (up to $750 cash back or $37,500 in annual spending).

Breaking Even

The exact amount to break even is $2,750 in spending per year (pre-tax purchases). With that, you would have earned $55 in cash back; thus making up the difference of the annual fees.

$2,750 is equal to $229.17 per month. So as long as you are average above $230 per month before tax, you will be coming out ahead. This may or may not sound steep, either way, just be wary of the exceptions.

Exclusions List

The following items/categories do not qualify for the 2% rewards, which is divided by regions of Canada:

In all provinces

• prescription drugs
• all tobacco products (including: cigarette paper, lighters, matches and tubes)
• all food court items
• all bottle deposits and refunds
• all taxes and levies
• all Costco Services (click here for a complete list)
• Costco Travel
• eye examinations
• tire disposal fees (where applicable)
• tire mounting and balancing, and stud installation fees
• gift certificates and Costco Cash electronic gift cards
• membership fees
• oil disposal fees (where applicable)
• home delivery charges
• administration fees
• gasoline
• charitable donations
• third party insurance payments
• postage stamps
• environmental fees, deposits or levies
• other items, products and services specified as exclusions from time to time

Only in the province of Alberta

• all alcoholic beverages

Only in the province of Nova Scotia

• all liquid milk and cream items (e.g., 1%, 2%, homogenized and skim milk, chocolate milk, light cream, cream blends, coffee cream, whipping cream, egg nog, buttermilk, concentrated milk, etc.)

Only in the province of Quebec

• all pharmacy items (including analgesics, cough and cold medication, allergy medication, eye care products, antacids, condoms, nicotine replacement therapies, vitamins, minerals, supplements, insulin, etc.)
• all alcoholic beverages
• all liquid milk items (e.g., 1%, 2%, homogenized and skim milk, chocolate milk, light cream, cream blends, coffee cream, whipping cream, egg nog, buttermilk, concentrated milk, etc.)
• all optical centre items and services (e.g., eyeglasses, contact lenses, etc.)

Use of Reward

Reward coupons will be mailed with membership renewal notices. Reward coupons may be redeemed by the primary member toward purchases of most merchandise through the front-end registers at Costco Wholesale warehouses throughout Canada only.

Just like the exclusion list on which purchases qualify for earning the 2% cash back, you cannot use the reward coupons towards:

• alcoholic beverages, cigarettes or other tobacco-related products
• purchases that are not recorded through Costco Wholesale’s front-end registers (such as gas stations, food courts, Quebec only optical centres, pharmacies and online at Costco.ca
• services, including travel, auto and other services
• purchases where prohibited by legal or regulatory restrictions
• other purchases as determined from time to time at Costco Wholesale’s discretion

Lastly, reward coupons will not be replaced if lost or stolen, so don’t lose it!!