3 Reasons to Cancel Your Costco Membership in August

Image source: Upsplash/The Motley Fool

It's not always easy to see the signs that a relationship isn't working out. But this month might be a good time to reevaluate your relationship with Costco . Here are a few reasons August might be the best time to cancel your Costco membership.

1. Price increases are coming in September

After strongly hinting at an upcoming increase last May, Costco finally dropped the official bomb that membership fees are increasing as of Sept. 1, 2024. Here's what to expect:

An increase of $5 or $10 may seem small in the scheme of things, but this is a jump of 8.3% across the board . And it coincides with a number of price increases we've seen on the Costco shelves as well.

I don't think it shocked many people when Costco announced the membership fee increase -- but that doesn't mean we liked it. Especially when you put it into proper context: Costco's sales for the first half of 2024 increased 7% over last year -- to a total of $171.44 billion. (Yeah, billion with a B .)

2. You're not getting your money's worth

Even with upcoming increases, you may still get back your fee's worth in savings each year. However, plenty of other people won't save enough to make up for the cost.

The whole point of paying to shop at Costco is to save money. If it's actually costing you money each year, then it isn't worth it. (Even Kirkland products aren't so good that I'd pay more than necessary to buy them.)

Happily, you can cancel your Costco membership at any time. Even better, you can request a refund on your membership fee per the company's satisfaction guarantee.

3. You want to switch to Sam's Club

Sometimes it's you. But sometimes, it's them.

Costco has a lot of pros, for sure, but it is hardly perfect. It's also not the only fish in this sea. Sam's Club has a few things that Costco severely lacks.

$50 memberships

In the face of Costco's upcoming price increase to $65 for a basic Gold membership, it's only fair to start with this one. A basic Sam's Club membership is just $50 a year.

Even if you want to upgrade, you're still paying comparably less than Costco. A Sam's Club Plus membership is just $110 a year (compared to the $130 that a Costco Executive membership will soon cost).

Scan & Go

Sam's Club has this amazing feature in its mobile app called Scan & Go. This lets you scan items as you shop, then check out in the app, skipping the checkout line entirely.

If you've ever been stuck in the limbo of a weekend Costco checkout line, then this feature alone could sway you to the other side.

Online shopping (that doesn't suck)

Even the most die-hard Costco fan has to admit that Costco's online and mobile experiences are, at best, dated. But even excusing some clunky interface and design, the actual utility of the site for shopping is abysmal.

Only a small portion of Costco's inventory is available for purchase online, and it's usually at a large markup. Beyond that, you can't place pickup orders or even see in-store inventories or prices.

Sam's Club's online shopping experience is significantly better, offering all of those features that Costco is missing: You can place a pickup order (free for Plus members on purchases over $50), purchase many items for shipping (also free for Plus members over $50), and see which stores have your items in stock.

Credit card diversity

Costco has some strong rules about which credit card networks it will accept. In store, it's only Visa credit cards. Online, it's Visa and Mastercard credit cards.

For folks who like to maximize credit card rewards, these rules are a real bummer. The list of cards for maximizing Costco purchases is very limited, which represents a huge opportunity cost in lost rewards.

Sam's Club, on the other hand, is happy to let you charge those 1,000-yard rolls of parchment paper and tubs of cookie dough on any card you like. (Think of the welcome bonuses that opens up!)

Cancelling is such sweet sorrow

It can feel a little awkward to cancel a membership to something that other people hold so highly. But not everything is for everyone.

When Costco's membership fee isn't worth paying, it's time to say goodbye.

We're firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers. The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team. Brittney Myers has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Costco Wholesale, Mastercard, and Visa. The Motley Fool recommends the following options: long January 2025 $370 calls on Mastercard and short January 2025 $380 calls on Mastercard. The Motley Fool has a disclosure policy .