If you're a Costco member, you probably know that members line up after shopping at the warehouse club's stores to fill up their tanks. Many members even go out of their way to use Costco's gas station rather than stopping at whatever station is closest to home.
But how much could you really save by filling up your car at Costco? Is it enough to cover the entire cost of membership all by itself? Here's the answer.
How much do Costco memberships cost?
There are two types of Costco memberships for individuals. The basic membership (formally known as the Gold Star Membership) costs $60 per year. The upgraded Executive Membership has an annual price tag of $120 and has a few additional benefits, such as a 2% annual reward on eligible Costco purchases.
How much can you save filling up at Costco?
Of course, it depends on a few factors, such as the price of gas in your area, the mileage you drive each year, how many drivers there are in your household, and the fuel economy of your vehicle.
However, let's look at what the average driver could save. Most reports seem to indicate that Costco gas tends to be about $0.20 less on average than traditional gas stations in the same area, although there are reports that estimate the savings at nearly double this amount. To be conservative with the analysis, we'll use $0.20 per gallon in savings.
With the average driver covering about 13,500 miles in the average year and getting approximately 25 miles per gallon, the typical driver can expect to save a little more than $100 per year.
If you have two drivers in your household, you can double the potential savings. And if you have a vehicle that gets worse-than-average fuel efficiency or if you drive more than the average American, your savings could be even greater. Last but certainly not least, if you use the Costco Anywhere Visa® Card by Citi to pay for your gas, you could save even more.
A few caveats, but the answer seems to be yes
The short answer to whether Costco gas savings can justify the cost of a membership is yes. But there are a few things to keep in mind.
Most significantly, this analysis assumes that you only fill up your gas tank at Costco, which may not always be practical. It would certainly make sense for most of your fuel needs if you live down the street from a Costco warehouse club, but if you live across town, it might not make sense for each and every fill-up. And if you take long road trips often, it may not be convenient to find a Costco to fill your tank wherever you are. So, while you can save hundreds of dollars by filling up only at Costco, you need to decide if it's practical to do so.
Also, as mentioned earlier, your own driving habits and vehicle need to be taken into consideration. For example, if you drive as many miles as the average person but have a highly efficient car that gets 50 miles per gallon, your annual savings will likely be closer to $50. That's not quite enough to justify the cost of a membership based on gas costs alone, and also not a lot to stick in your savings account.
The bottom line is that every situation is different. But some basic math shows that the average American driver could justify a basic (Gold Star) Costco membership through gas savings alone, even if they don't fill up at Costco 100% of the time. And a two-driver household could even justify an Executive Membership by filling their tanks at Costco most of the time.
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FAQs
Gas at Costco was among the cheapest options at $5.09 per gallon. That would be a savings of 30 cents per gallon at Costco compared to 7-11, or $4.20 per 14-gallon tank. You'd save an average of $218.40 per year buying gas at Costco, which more than pays for your membership.
Is it worth getting Costco membership just for gas? ›
Generally speaking, buying gas at Costco is significantly cheaper than doing so at a traditional gas station. The typical driver can save more than $100 per year. Buying gas at Costco can justify a membership all by itself.
How much does Costco save you on gas? ›
It's a well-accepted fact that Costco gas is cheaper than the fuel at most other places. While the exact amount of savings you'll get depends on factors like where you live and which club you visit, you can reasonably expect to save around $0.15 to $0.20 per gallon.
Do Costco members get a discount on gas? ›
Price check. Quality gas is important, yes, but so is price. Costco Gas Stations offer consistently low, member-exclusive prices. With the Costco app, you can check Costco gas prices on your phone.
How do I pump gas with my Costco membership card? ›
The way it works is simple. Pull up to a pump and insert your membership card. Next, you can insert or tap your payment card.
Does Costco gas count towards membership? ›
In the U.S., Rewards are not calculated: (i) on purchases of cigarettes or tobacco-related products, gasoline, Costco Cash Cards, postage stamps, alcoholic beverages in certain states (including Alabama, Connecticut, Georgia, Kentucky, Michigan, Ohio and Tennessee), and at food courts; (ii) on membership fees; (iii) on ...
How to get a free Costco membership? ›
While Costco doesn't offer free or discounted memberships, we do provide an exclusive college student offer to join Costco as a new member and receive a Costco Shop Card!
Why is Costco Premium gas so cheap? ›
So why is it so much cheaper than the competition? The short answer is that unlike pretty much every other retail business that sells gasoline, Costco doesn't care about making money from its gas pumps. In fact, Costco typically sells its gas at a moderate loss.
What is the benefit of getting gas at Costco? ›
Costco gas is offered at a great price
Although the exact amount of savings you'll get varies based on your location and the specific club you're shopping at, you'll typically save around $0.20 per gallon at Costco according to most online reports. Most cars hold between 10.5 and 18.5 gallons of gas.
Does Costco even save you money? ›
As he showed, many items are priced lower at Costco than at competing stores and if you can shave even a little bit off your grocery bill each week by buying them there, the savings can add up. However, Ramsey also explained that while you can save money, there's no guarantee you will.
If you're the Primary Member or Account Manager, you can assign your free household card to one other person in your home. That way they'll also get the benefits of a Costco membership. To add someone, sign in and head to Account Details in your Costco.com Account.
Can you share Costco membership for gas? ›
When you like something, it's natural to want to share it with others. However, if that "something" is your Costco membership card, you should definitely think twice before sharing. Costco membership is non-transferrable. This means only you can use your membership card.
Do you get 4% back on Costco gas? ›
Earn cash back rewards on purchases wherever Visa® is accepted. You'll get 4% back on eligible gasoline purchases for the first $7,000 per year and then 1% thereafter. You'll also earn 3% on restaurants and eligible travel purchases, including Costco Travel.
Is a Costco membership worth it for gas? ›
Lastly, the gas prices are pretty great at Costco.
Most recently I saved 38 cents a gallon at Costco compared to the other gas stations in the area. That adds up to me saving a few hundred dollars a year on gas by choosing Costco. Sometimes the lines to get gas at Costco are long, but I can see why.
Can my son use my Costco card for gas? ›
Costco Shop Cards may only be purchased or recharged by members, but with assistance from an attendant to first authorize the pump, anyone can use a Costco Shop Card to pay for fuel.
Do they check ID at Costco Gas? ›
Basically, Costco wants to preserve the value of being a member by allowing only its members access to its warehouse clubs. It has recently gotten more aggressive in checking IDs at checkout to make sure that the cardholders are actually the members. Only Costco members can buy gas at the warehouse club's stations.
Is Costco gas card worth it? ›
It actually offers higher rewards rates on gas purchases (4% cash back up to $7,000 spent per year), travel (3% cash back) and dining at restaurants (3% cash back). All other purchases provide 1% cash back, which is about average for a rewards card.
Do you need Costco membership for fuel? ›
You need to be a current Costco member to be able to dispense fuel at Costco. Upon successful membership validation, transactions must be then 'pre-authorised' with a payment card, to check there are available funds on the card before the fuel transaction can commence.
Why does everyone go to Costco for gas? ›
It's good for your car
The fact that gas is cheaper at Costco doesn't mean it's lower in quality. The company offers Kirkland Signature gasoline, which is formulated to improve vehicle performance and fuel economy. Costco says the gas also reduces emissions, making it better for the environment.
