The Costco Effect

I've often wondered, as I think many people do, whether or not one actually saves money by shopping at a place like Costco.

From Wall Street Journal Personal Finance -

"People are often price-sensitive about an initial purchase. But after the money has been spent, there's a tendency to view the stash -- be it a pile of bagels or imported stout -- as manna from heaven."

This was a great point (and something about which to be cautious)-

"Costco, in particular, specializes in stocking unexpected gourmet food and luxury items that spur impulse buys. It isn't hard to drop $300 or $400. Even if you're getting a deal, that's a lot of money."

1-800 Contacts

I have an exciting development to report. I have used my HSA card for the very first time, and made a purchase, using pretax dollars, of an eligible product. I went on 1800contacts.com to check out the prices for contacts that I last bought at Costco (where I was unable to use my HSA card because they don't have the proper vendor code), and upon viewing the homepage, saw that FSA (Flexible Spending Account, an inferior predecessor of the HSA) cards can be used to purchase contacts. I called customer service to check if I could use my HSA and they said "yes". Even though the contacts are quite a bit cheaper at Costco, it's a long drive for me, and I was able to finally put my HSA card to the test. It was just like using a normal credit card. This kind of stuff will only get easier.

I should note that, even if one cannot use one's HSA card at Costco's Optical department, as long as the receipt is retained, one may reimburse oneself with HSA funds by doing a transfer to a personal account or writing a check. It's an extra step that takes away some convenience, though.

Here are some statistics and U.S. Treasury documents from HSA Insider.