Why Doesn't Costco Discount Its Memberships?

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If you're looking to join Costco , it pays to do so as soon as possible. Right now, the cost of a basic Costco membership is $60, but that fee is rising to $65 starting Sept. 1. Similarly, come September, the cost of an Executive membership that gives you 2% cash back on your purchases is rising from $120 to $130.

If you're a student, senior, or new customer looking to join Costco for the first time, you may be wondering if it's possible to get a discounted membership. It's not uncommon for companies to offer up lower prices for people in these categories.

But Costco, as a matter of policy, generally does not offer discounts on its memberships. And there are a couple of reasons for that.

1. It doesn't have to

Companies tend to offer discounted memberships as a means of drumming up business. But that's not something Costco has to do, because the warehouse club giant's membership base keeps growing nicely as it is.

During its last earnings call in late May, Costco reported membership fee income of $1.123 billion for the third fiscal quarter of 2024. That was an increase of $79 million, or 7.6% year over year.

It's possible that Costco may explore the option of discounted memberships in the future if its numbers start to shrink. But for now, the company doesn't have to worry about that.

2. It's not beneficial to customers

A discounted membership at Costco might be something you want. But it's not necessarily something you'll really benefit from.

Sure, it would be nice to pay less upfront for Costco access. But you should know that Costco uses the revenue it collects in membership fees to offset its costs and pass savings along to its customers.

So let's say you're looking at paying $65 for a basic Costco membership at your next renewal. Costco is going to use that $65 to offer you the great prices you're used to on its inventory and services. Less revenue from lower membership prices would likely lead to reduced perks overall.

All told, Costco would rather charge shoppers more money to access the store, but then provide them with an outstanding experience and big savings once they're in the door.

Don't expect a discount anytime soon

If you're waiting to join Costco until a discounted option becomes available, you may end up waiting a long time. And you might miss out on the chance to lock in your membership at the $60 or $120 price point rather than pay $5 or $10 more from the start. So if you feel that a membership might benefit you, sign up before Sept. 1.

Remember, too, that Costco stands behind its memberships. If you find that you're not getting great use out of yours, you can cancel at any time before the one-year mark for a full refund. So there's very little risk in signing up. You may find that you're so happy with Costco's offerings that you don't care about not getting a discount on your membership fee.

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