If You Invested Your Costco Membership Fee Into the Company’s Stock 5 Years Ago, Here’s How Much You’d Have Now
Written by
Dawn Allcot
Edited by
Levi Leidy
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A Costco membership is often a good investment for families looking to save money on groceries, household goods, electronics and even furniture. If you purchase the Gold Star membership, you’re likely to save more than the $65 membership cost within a year. Meanwhile, the $130 Executive membership pays 2% rewards good toward future Costco purchases.
But what if you literally invested those membership fees into Costco stock five years ago? How much extra cash would you have today?
What You Need To Know About Costco Stock
Costco is a dividend-earning stock, with a total return of 216.83% over the past five years, according to FinanceCharts.com. Total return includes reinvesting stock dividends.
The membership fees in 2020 were only $60 (for Gold Star) and $120 (for Executive); Costco hiked the price in 2024, the first increase since 2017. For our calculations, let’s assume you put just today’s membership fee of $130 or $65 into the stock in September 2020 and continued reinvesting dividends.
Note that the stock price on Sept. 8, 2020, was $343.84, so you’d need to use a platform like Robinhood that allows purchases of fractional shares.
Costco Gold Star
If you invested $65 in September 2020, based on the five-year total return of 216.73%, you’d have $205.67 today. That would be enough to pay for three more years of membership at today’s Gold Star rates, with enough left over for a rotisserie chicken and a few hot dog and soda combos.
Costco Executive Membership
Using the same calculations, if you invested $130, instead, you’d have $411.73. That would cover your Executive membership for three more years, plus buy a few Costco pizzas to take home.
Should You Sell Your Costco Stock Now?
The reality is, if you sold your Costco stock today, you’d have to pay tax on that money, unless you used strategies like tax-loss harvesting to offset your earnings. You’d also miss the likely possibility of future gains. Your dreams of passive income and future wealth could disappear in a sea of Costco chicken bakes and oversized chocolate chip cookies.
Experts are calling Costco stock a “hold” right now, due to its promising future but high valuation. “With aggressive store expansion and e-commerce growth, the company is well-positioned for sustained long-term gains,” according to Zacks.com.
Following the wholesale club’s third-quarter earnings report, Zacks wrote, “While current investors should hold the stock, new investors should wait for a pullback before buying.”
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