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Costco fans know that signing up for an annual membership usually means tons of savings on bulk items, discounts on gas, and plenty of unexpected good deals. By some estimates, you can save $1,000 in grocery shopping expenses with a Costco membership.

But just because most people save money with Costco doesn’t mean a membership is right for everyone. In fact, I recently let my Costco membership lapse because I wasn’t using it enough.

Here are five signs a Costco membership just isn’t for you.

1. You don’t buy Costco gas

Costco gas can be significantly cheaper than the national average. The closest gas station near my home is charging $2.69 for a gallon of regular unleaded, while my local Costco store sells it for just $2.48.

If I went to Costco every time I needed gas and filled up for the average of 489 gallons Americans use yearly, I’d save an estimated $102!

But, it wasn’t very convenient for me to buy gas at Costco frequently because of the store location. My family only bought Costco gas once per month, if that, when making a Costco run. If you’ve found the same to be true for you, then even Costco’s steep discount on gas probably isn’t enough to make the cost of membership worth it.

2. You’re not earning enough cash back rewards

There are two tiers of Costco membership. The first is a Gold Star membership that costs just $65 annually and doesn’t include any cash back rewards. However, if you upgrade to an Executive membership (which costs $130 annually), you can earn up to 2% back on most in-store and online purchases.

You can earn up to $1,250 back if you spend a total of $5,210 or more at Costco annually. But that means you’d have to spend at least $434 monthly to earn the maximum amount.

While it’s a nice perk, you can certainly earn a higher percentage of cash back with a good credit credit card. Click here for our list of the best credit cards to use at Costco.

3. You find great deals at local grocery stores

Inflation has wreaked havoc on many people’s grocery budgets, but there are still grocery stores where it’s relatively easy to keep costs low. My family regularly shops at Aldi and has found it to be one of the cheapest options around.

Sure, you won’t get the same product selection as at Costco, but I like the simplicity of a smaller grocery store and knowing that I’m likely getting the lowest prices available. We pay about $2 for a dozen eggs! A recent comparison conducted by AARP found that Aldi was cheaper than both Walmart and Target.

4. You’re overspending at the club

The average Costco member spends an estimated $150 per trip at the store. Of course, it’s easy to spend much more if you come across some good deals.

I’m a sucker for finding a discount, so when I spy something on sale, I’m tempted to buy it, even if I don’t actually need it. Costco knows this all too well, which is why it’s easy to overspend when browsing Costco aisles.

The average American spent $150 in impulse purchases each month in 2023. If you add this to the average amount most Costco members spend, it means you could be doubling your Costco spending if all your impulse purchases occur at the store.

Related: 1 in 5 Americans don’t have an emergency fund. A high-yield savings account could help you build one quickly. Click here to see our review of top-rated savings accounts.

5. Your local Costco location is inconvenient

While Costco tries to put its stores in high-traffic locations, your local store still may not be convenient for you. This was the case for me; our nearest Costco is located on the side of town I don’t travel to frequently, and the roads around it are jam-packed on a regular basis.

In contrast, our Aldi store is just two minutes away, and we have another local grocery store just a few blocks away. If you find it difficult to fight the traffic just to get to Costco, a membership might not be a good fit for you.

Don’t get me wrong — a Costco membership can be a great option for many people. I have friends who love their membership and shop at the store often. But if you’re not taking advantage of gas perks and cash back or you’re overspending at the store, it’s a good sign that a membership isn’t worth it for you.

Top credit card to use at Costco (and everywhere else!)

We love versatile credit cards that offer huge rewards everywhere, including Costco! This card is a standout among America’s favorite credit cards because it offers perhaps the easiest $200 cash bonus you could ever earn and an unlimited 2% cash rewards on purchases, even when you shop at Costco.

Add on the competitive 0% interest period and it’s no wonder we awarded this card Best No Annual Fee Credit Card.

Click here to read our full review for free and apply before the $200 welcome bonus offer ends!

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.
Motley Fool Money does not cover all offers on the market. Editorial content from Motley Fool Money is separate from The Motley Fool editorial content and is created by a different analyst team.Chris Neiger has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Costco Wholesale, Target, and Walmart. The Motley Fool has a disclosure policy.