Thinking of Joining Costco? Here's Why You May Want to Do It Now

Waiting to join could cost you.

These days, consumers are spending more money than usual to put food on the table. As of January, grocery prices were up 11.3% on an annual basis, as per the most recent Consumer Price Index reading. And we could be stuck with soaring grocery prices for many more months.

It's for this reason, among others, that you may be thinking of signing up for a Costco membership. Buying food and household goods at Costco might result in a lower credit card tab than you'd be looking at by shopping at a regular supermarket or big-box store.

But if you're going to join Costco, it pays to get moving quickly. Wait too long, and you might get stuck paying more for your membership.

Lock in a lower rate while you can

Right now, the cost of a basic Costco membership is $60 a year, while the cost of an executive membership is $120. An executive membership gives you the benefit of 2% back on your purchases, the same way you may be used to getting cash back from your credit card.

But these prices may not last that long. Costco typically raises its membership fees about every five and a half years. The last time an increase took effect was June 2017. And in a recent earnings call, Costco CFO Richard Galanti basically came out and said that members should expect a fee hike.

Now, one thing he didn't say was when that fee hike would take place. But he was quoted as having said, "It's a question of when, not if." So it's fair to assume that there's a good chance Costco memberships will go up in price at some point in 2023.

So if you're been thinking about signing up for Costco, you may want to do so now. When you sign up for Costco membership, it's good for a year. So if you lock in the current rate now for either the basic or executive membership, you won't have to worry about a fee hike until your membership comes up for renewal.

Is it worth it to join Costco?

Shopping at Costco can result in a lot of savings, but that's not necessarily the case for everyone. If you're on the fence about a Costco membership, ask yourself:

• Do I have a Costco store nearby? If the closest one is 30 minutes away, you may not get there often enough to make good use of your membership.
• Do I have a larger family to feed? If you live alone, or it's just you and a partner, you may not be able to take advantage of bulk discounts on perishable items.
• Do I have a lot of storage space? When you buy a 24-pack of toilet paper, you need a place to put it. If your home lacks storage space, you may find that buying in bulk is a hassle.

Joining Costco could help you keep your bills down at a time when living costs are so expensive. And if you're going to join, you might as well do so before membership fees increase. But take some time to think about whether you're likely to get your money's worth before locking in that membership.