2 Reasons Why Costco Executive Is More Popular Than Gold Star

Starting September 1, 2024, shopping at Costco will get more expensive. Rates for both membership tiers will increase—the Gold Star membership will cost $65 per year and the Executive membership will cost $130 per year.

When Costco announced the increase, it also gave us some interesting information, such as that it now has about 52 million members. Perhaps more interesting is that “a little over half” of those memberships are Executive memberships.

Considering that the Executive group membership costs twice just like the regular Gold Star membership, why have so many people upgraded? There are two main benefits to the Executive upgrade – although most members are probably more inspired by the first than the second.

1. Costco Reward 2%

You could argue that the main reason to upgrade to an Executive membership is the 2% Costco Reward. Executive members receive 2% back on purchases at Costco, including costco.com and Costco Travel.

Here’s what a 2% rebate could look like based on your spending at Costco:

Monthly expenses	Annual Expenses	2% Annual Cashback
100 dollars	1200 dollars	24 dollars
271	$3250	65 dollars
500 dollars	6000 dollars	120 dollars
688 dollars	$8,250	165 dollars
1000 dollars	12,000 dollars	240 dollars
2000 dollars	$24,000	480 dollars
3000 dollars	$36,000	720 dollars
4000 dollars	$48,000	960 dollars
5208 dollars	$62,500	1250 dollars

Data source: author’s calculations

Your 2% back is paid as a lump sum reward once a year. You can use the reward on purchases at Costco, including your annual membership fee. The 2% reward is capped at $1,250 (as of September 1) per year.

Tip: The 2% back you earn is separate from any other coupons or rewards, so make sure you pair it with a good Costco rewards card to maximize your return.

2. Costco Discounts

Costco offers a range of services beyond its stock. This includes everything from pet and home insurance to garage door or closet installation.

All members have access to these services — and some general discounts — but Executive members often receive additional benefits. Here are a few examples:

$15 sign-up fee waived for Fido pet insurance through Costco
Free Roadside Assistance with Car Insurance at Costco
Free Home Window Repair/Replacement with Home Insurance by Costco
No application or declaration fees for payment processing services through Costco

To be clear, the benefits of the insurance only come into effect when you purchase the policy while logged into your Costco account and using links from Costco’s service pages. You can’t simply apply them to your existing third-party insurance.

Additional Reason #3: We won’t ask you to upgrade anymore

Okay, this may be a bit of a joke, but for many people it may make sense: once you upgrade your membership, the checkout staff will stop asking (and sometimes demanding?!) for an upgrade.

You can now check out in (relative) peace. Enjoy the peace.

Is it worth buying an Executive class upgrade?

While the various additional service discounts may be useful for some members, most people upgrade to the Executive tier to receive the 2% reward. So to figure out if the upgrade is right for you, just look at how much you spend at Costco each year.

As the table above shows, you would need to spend $3,250 per year to get back $65. You would need to spend $8,250 in a year to get back $135.

In other words, an annual expense of $3,250 would cover the upgrade from Gold Star to Executive. If you spend more than that each year at Costco, the upgrade may be a good move for your budget. If not, keep your Gold Star membership (assuming you get value from it).