Will Your Costco Membership Actually Save You Money?

For me, a Costco membership is a no-brainer. I shop at the store every week and save a bundle on groceries compared to what I'd spend at my local supermarket.

But to be fair, I also have a Costco store within 15 minutes of my home. I also have three kids and a husband, so we go through a lot of groceries and cleaning supplies.

Your situation might be different. And if so, it's not a given that a Costco membership will make financial sense for you.

Even though a basic Costco membership is only $60 per year, you don't want to throw that money away. Rather, you want to make certain you'll actually save money when you sign up. If you're not sure that'll be the case, ask yourself these questions.

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1. How often will I use my membership?

If you have a Costco store near your home, then you're more likely to visit than if your closest warehouse club is 45 minutes away. Think about how often you'll shop at Costco, as that might help determine whether a membership makes sense.

Let's say you figure on shopping at Costco every two weeks, or 26 times a year. If you're able to save even $3 each visit, that's $78. Subtract the $60 membership fee, and you're ahead by $18.

Of course, you might save well more than $3 per Costco visit. And your total savings for the year may be much more significant. The point, though, is that the more frequently you expect to shop at Costco, the more money you have the potential to save.

2. Does bulk buying make sense for me?

Buying things like groceries and household essentials in bulk makes sense for me because of my household size. But if you live on your own, or it's just you and a partner, then you may not get the same value out of a Costco membership. The same might hold if you're a family of six but you live in an apartment with minimal storage space. That makes bulk buying just as challenging.

Buying in bulk isn't the only way to save at Costco -- but it's a big part of the value a membership offers. If you're not in a position to benefit from bulk purchases, you'll need to ask yourself what exactly it is you want out of a membership, which leads to the next question.

3. What non-grocery and household items might I buy at Costco?

Costco sells way more than just groceries and paper towels. You can buy everything from clothes to home decor to electronics at Costco. You can also book a vacation through Costco, potentially saving yourself hundreds of dollars with just one purchase compared to the cost of buying a similar package elsewhere.

So for this reason, don't write off a Costco membership automatically if bulk buying doesn't make sense for you. Instead, read up on the perks of a Costco membership and see if any of those might be worth the $60 fee. If you can book a cruise for $3,200 and the next closest deal you find for a similar itinerary is $3,800, you've made back 10 times your membership fee.

It's a low-risk proposition either way

It's not always easy to predict whether a Costco membership will save you money. Sometimes, the only way to answer that question is trial and error -- meaning, join and see how your first year goes.

However, you should know joining Costco is a pretty low-risk proposition. If you don't end up getting good use out of your membership, just cancel before the year is up and Costco will refund your fee. Yes, really. So if you're on the fence, the worst thing that'll happen is that you'll shell out the $60 for a membership upfront and wait to get that money back if things don't work out.