Inflation has been going bonkers in the last few years, with prices going up for just about everything. And the fact that Sam’s Club increased their membership fees in October 2022 had lots of people wondering for a while if rival Costco was planning to do the same thing with their Costco membership fees.
Well, we finally heard some huge news as of July 10: a Costco membership fee increase is coming on Sept. 1, 2024, according to a recent press release posted on the Costco Investor website.
On that date, membership fees will increase by about 8% — from $60 to $65 for Gold Star and from $120 to $130 for Executive. And the Executive 2% reward maximum is going from $1,000 to $1,250 per year, which will be a change to the Executive membership benefits.
Industry watchers fully expected this kind of Costco membership fee increase to happen sometime in 2024, but it's still big news since the Costco membership price hasn't seen a change since June 2017. And if you're almost to your renewal date, you may want to renew early, before the changes set in.
For more smart shopping tips, savings hacks, and Costco deals this week, text HACKS to 57299.
A Costco membership fee increase is coming on Sept. 1, 2024.
As detailed in a July 10 press release posted on the Costco Investor website, a Costco membership increase in fees is happening for all members on Sept. 1, 2024.
Here are the new annual membership fees that will go into effect in September:
Gold Star: $65 per year (currently $60)
Executive: $130 per year (currently $120)
Business: $65 per year (currently $60)
Granted, we're well overdue for this Costco membership fee increase, as it's been about seven years since the last increase (since June 2017). And the increases before that used to happen roughly once every five years and seven months.
TIP: Now would be a good time to lock in the $60 Costco membership before the price goes up Sept. 1. You can also choose to renew early if your membership's expiration date is within 90 days.
How much is the Costco membership fee right now?
If you're already a Costco member (or thinking about joining soon), you'll want to lock in the current price before it goes up on Sept. 1. That's because no one — not even current members — will be able to renew at the lower rate after the fee changes go into effect.
Through Aug. 31, 2024, Costco’s standard Gold Star Membership costs $60 per year. With a Gold Star Membership, you get these Costco membership benefits:
Member-only savings at Costco
Two membership cards
Currently, Costco’s Executive Membership costs $120 per year. Executive members represent about half of all paid Costco memberships. With an Executive Membership, you get:
Member-only savings
Two membership cards
Annual 2% in rewards on qualified Costco purchases
Additional benefits and more savings on Costco Services
Extra benefits on select Costco Travel products
Costco’s Business Membership costs $60 per year. With a Business Membership, you get:
Member-only savings
Two membership cards
Ability to add affiliate cardholders for $60 each
Purchases that are eligible for resale
TIP: We wrote a whole post to help you decide if a Costco membership is worth it, based on your spending levels.
Prior to July 2024, it was a question of "when, not if" membership fees were going up.
On just about every Costco earnings call, a participant asks the question of whether Costco plans to raise their membership fees.
And just about every time, the answer given by Costco’s Chief Financial Officer (after a chuckle) was that "it’s a question of when, not if."
I've tuned into just about every quarterly earnings call since 2023, and here's what I was hearing from their management team:
May 30, 2024: "It continues to be talked about," said current Costco CFO Gary Millerchip. "It's something that is still a case of 'when' we increase the fee, not 'if' we increase the fee, but we're still evaluating those considerations to determine what the right timing is."
March 7, 2024: "It's when, not if, still," said former CFO Galanti. "It's not some big analytical formula. It's simply a measure of, we will, at some point, I'm sure, do it."
Dec. 14, 2023: "We like providing extreme value. Certainly, while we’ve gone a little longer than the average increase, we feel we certainly have driven more value to the membership," said Galanti. "So, you know, I’ll use my standby answer, my pat answer, it’s a question of when, not if. But at this juncture, we feel pretty good about what we’re doing."
Sept. 26, 2023: "You’ll see [a membership fee increase] happen at some point," said CFO Richard Galanti. "We can’t really tell you if it’s in our plans or not. We’ll let you know when we know."
They’re banking on the fact that Costco members have great loyalty. According to the numbers shared in May 2024, renewal rates are at an impressive 93%.
TIP: Are you a Costco nerd, too? You’re totally allowed to listen in on the quarterly earnings calls on their website to hear the CFO talk about which items are selling well, how they’re revamping the Costco app, and when a fee increase is coming. It’s basically just an audio-only webcast.
This membership fee increase of $5 - $10 is pretty much in line with what we expected.
Costco had said that, eventually, the membership fees WOULD go up. And there was definitely a reason to believe it would happen sooner rather than later, based on the dates of past price hikes.
Here’s what that pattern looked like in the past:
September 2000: Gold Star membership went from $40 to $45 (13% increase)
May 2006: Gold Star membership went from $45 to $50 (11% increase)
November 2011: Gold Star membership went from $50 to $55 (10% increase); Executive membership went from $100 to $110 (10% increase).
June 2017: Gold Star membership went from $55 to $60 (9% increase); Executive membership went from $110 to $120 (9% increase).
Based on the pattern of about five years, seven months between price hikes, we would have been on target for a more expensive membership as of January 2023 — but according to Costco, that didn't happen thanks to a financially successful last few years.
TIP: With prices rising eventually, we can help you figure out if a Costco membership is worth it.
Sam's Club membership fees went up $10 in October 2022.
The buzz around a Costco membership price increase gained speed in September 2022 when Sam’s Club announced they’d raise the Sam's Club membership cost for the first time in nine years.
As of Oct. 17, 2022, the annual price for a Sam’s Club Basic membership level increased from $45 to $50 (11%). For the upgraded Sam’s Club Plus membership, it went from $100 to $110 (10%).
However, to ease the blow, Sam’s Club covered the cost for active members. If you were a Club member at the time they raised the fee, they gave you $5 in Sam’s Cash, and if you were a Plus member, you got $10 in Sam’s Cash.
When membership warehouse clubs increase their fees, the increase is usually by about 10%. But Sam’s Club is still cheaper overall.
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