The Best Thing I’ve Learned About Budgeting for Costco

published Jul 31, 2021
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The last year of lockdowns (and beyond-the-norm grocery shopping that’s come with them) has taught me a few things about my shopping habits and my family’s food preferences. After discovering the supreme value of a second refrigerator and my kids’ deep abiding love of ramen, I’ve also come to terms with my love-hate relationship with Costco.

Once an “event” to distract the kids on a rainy day, it’s now become a necessary, grin-and-bear-it activity. Gone is my fascination with samples: I want to get in and out! Costco does have some of the best prices on things I normally use, but it’s that big bill at once that frustrates me. Talk about blowing the grocery budget in one go!

While it’s certainly gratifying to be able to do a big stock-up, Costco can’t meet all my family’s grocery needs. I still need to shop elsewhere. If I spend half the month’s grocery money in one stop, that leaves me scrambling the rest of the month to get what I need or want. Here are two tips that have helped reconcile this a bit for me, though, and maybe they will be helpful for you too!

Space out your Costco visits.

I’ve found that shopping at Costco once every few months has been sufficient — not only in dealing with crowds and shortages, but also with the realization that most things we buy do take a few months to use up. Staying out of the store and shopping my kitchen is a great boon for my grocery budget, but I took it a step further by creating a Costco “sinking fund.” (More on this below.)

Create a sinking fund.

In personal finance, a sinking fund is an allotment of funds set aside for infrequent but expected expenses. For instance, I have a sinking fund for birthdays and insurance premiums so that our general budget doesn’t have a major freak-out when those expenses come around. The money is there waiting, and the same goes for my grocery budget.

The best thing I’ve learned about budgeting and shopping at Costco is to spread the expense over several month’s accounting. Instead of letting that one long, flapping receipt with the smiley face decimate my grocery budget, I divide the cost and subtract it not from one month’s grocery allowance, but from two or three instead.

It makes perfect sense since those groceries are used over several months, and it gives me the freedom to shop at other stores when I need to. Costco doesn’t carry the ramen my kids like, anyway.

This post originally ran on Kitchn. See it there: The Best Thing I’ve Learned About Budgeting for Costco