Retirees often have to be careful with their money. After all, they no longer receive a salary and often have to keep their savings.
If you’re out of staff and considering spending some of your limited cash on a Costco membership, it’s worth considering whether the cost of joining is justified. With membership prices starting at $60 for a Gold Star membership and going up to $120 for an Executive membership, this may not seem like an easy choice.
In reality, however, there are two specific benefits that Costco offers that could make joining a particularly smart personal finance choice for seniors.
1. Medicines at a discount
The opportunity to save on prescription medications is one enormous motivator for retirees to join Costco.
According to the Georgetown University Health Policy Institute, 87% of Americans between the ages of 65 and 79 use prescription medications. For those over 80, that number rises to 91%. The average number of prescriptions filled annually is 20 for 65 to 79 year olds and 22 for those over 80.
These medications come at a cost, even with Medicare coverage. Individuals between the ages of 65 and 79 spend an average of $456 per year out of pocket to cover prescription costs, while those age 80 and older have to cut back an average of $510 on medications.
By joining Costco, seniors can reduce these costs. The Costco Member Prescription Program makes it possible to save up to 80% on popular medications. That means an average senior spending $456 annually could reduce that amount by as much as $364.80. The savings on prescriptions alone would more than justify the annual membership fee.
Let’s see An popular drug. Celebrex treats rheumatoid arthritis and osteoarthritis – two common conditions in the elderly. The generic version, Celecoxib, was more than $10 cheaper at Costco compared to Target or CVS in multiple markets in several states, including Florida, Pennsylvania and California. The discount on this one drug alone will cover Costco’s annual cost and then some, assuming you get a 30-day monthly supply.
2. Travel with a discount
Travel is a passion for many seniors who have the money, time and health to see the world. More than half (52%) of seniors aged 50 and over describe travel or holidays as their top priority when it comes to spending their discretionary income. Costco can make those trips cheaper.
The Warehouse Club offers numerous vacation packages at great prices. When The Ascent compared Costco’s costs to alternatives, there were several trips that resulted in savings of $500 or more. Plus, Costco also allows you to earn a 2% cash back reward when you book vacations through Costco Travel if you upgrade to the Executive Membership, which can reduce costs even further.
These two benefits alone are often worth joining Costco, especially if you’re like most seniors and tend to spend a lot on medications and vacations.
The good news is that if you’re not happy with your membership, Costco also offers a refund at any time. So you can join to see if your recipes or destinations are cheaper, and if it turns out you’re not saving enough to justify your membership fee, you end up losing nothing.
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We strongly believe in the Golden Rule. Therefore, editorial opinions are ours alone and have not been previously reviewed, approved or endorsed by the included advertisers. The Ascent does not cover all offerings on the market. The Ascent’s editorial content is separate from The Motley Fool’s editorial content and is created by a different analyst team. Christy Bieber has no position in any of the stocks mentioned. The Motley Fool holds positions in and recommends Costco Wholesale and Target. The Motley Fool has a disclosure policy.
These two benefits alone can make a Costco membership for seniors worthwhile, originally published by The Motley Fool
