I shop at Costco on a weekly basis. This is necessary for my household, since we’re constantly running out of products like milk, produce, and snacks (especially, ahem, the snacks).
But I like to time my Costco runs strategically to when my minivan’s gas tank is getting low. Buying gas at Costco commonly saves me money compared to the cost of filling up elsewhere. So it makes sense for me to buy gas when I’m already there to do other shopping.
But buying gas at Costco isn’t always your best move. Here are three reasons not to do it.
1. Costco fill-ups could lead to overspending
It’s true that you stand to save money on gas at Costco compared to a typical station. But that assumes your gas purchases don’t lead to impulse buys.
When you go to a regular gas station, the most you might be tempted to do is run in for a cup of coffee or snack. But if you go to Costco for the express purpose of filling your tank, you may decide to pop into the store and see what’s in stock. Given Costco’s vast inventory, you could easily walk out with a $100 credit card tab 30 minutes later, thereby negating your gas-related savings.
For this reason, I suggest doing what I do — fill up your car at Costco when you’re already going there with a specific shopping list. If you fill up at a time when you’re not supposed to be shopping, you might seriously bust your budget.
2. There may be a better deal on gas somewhere else
Costco definitely has the cheapest gas in my area — at least in the context of paying for gas with a credit card, which I pretty much always do since I rarely carry cash. But some gas stations offer deep discounts for paying cash instead of tapping or swiping a card. And if there’s a station in your neck of the woods that has this practice, you may find that it’s less expensive to fill up there in cash than to buy your gas from Costco. You can use apps like GasBuddy to research prices in your area and see what makes the most sense.
Also, even if Costco’s gas really is your absolute cheapest offer in town, remember that filling up at a much closer station might constitute a better deal. So make sure to take driving distance into account.
3. You won’t get cash back on your Executive membership
The main draw of Costco’s Executive membership is getting to earn 2% cash back on your purchases. But certain purchases aren’t eligible for that cash back, and gas fill-ups are one of them.
That said, if you use a credit card with great gas rewards, you might manage to snag some bonus cash at Costco’s stations. So that softens the blow a little.
I’m all for buying gas at Costco under the right circumstances. But if doing so will mean paying more for one reason or another, or spending extra on unplanned purchases, then it’s probably not a good idea. And if you do decide to fill up at Costco, be strategic about the credit card you use in light of the fact that there’s no Executive membership cash back to be had.
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