Warehouse clubs or wholesale clubs are large stores such as Costco or BJ's that charge a yearly membership that allows customers to purchase items at prices that are slightly above wholesale. The memberships cost anywhere from $50 to $100 a year and the idea is that you can save more than the membership cost by shopping at these stores. My husband and I recently decided to cancel our membership after realizing that we were not really saving money at all. Here are our reasons why we parted ways with the warehouse club. (See also: 5 Frugal Rules You Must Follow When Shopping at Costco)

1. Warehouse prices are not necessarily the best.

We used to buy things like toiletries and various meats at the warehouse, but pretty soon we realized that we could get cheaper prices at local grocery stores or stores such as Target if we just looked for weekly specials. When you pay a membership fee you expect that the prices are low, but that does not mean that you always get the lowest price. Many people just assume that the wholesale club has the lowest price and ignore other stores, and that could mean missed savings.

2. Quantities are too large.

Buying too much of something is a problem for small families like ours. These warehouses force you to buy a large quantity of everything, and sometimes things go to waste when they are not consumed in time. Another problem with large quantities is that it takes a lot of room to store them. We live in a 1000 square feet apartment and large piles of paper towels had to be stored in the living room, and that was a bit ridiculous. We also do not have a large freezer so a lot of frozen foods just will not fit.

3. The fee is not always recouped.

In the past few years we visited the warehouse club less than 10 times, and we are pretty sure we did not save enough to cover the membership fee. This is because it is just much easier to buy foods at grocery stores that are close by.

4. Shopping at a warehouse is stressful.

A big reason why we do not like visiting the warehouse store is because it is so crowded every single time. My husband also hates driving in the parking lots of these stores because people are always streaming out with huge carts of stuff. When you get inside the lines are always long. It is much easier for us to just walk to the grocery store on the next block to get something small like toothpaste even if we are paying 50 cents more. I do not know if it is like this in other parts of the country, but here in San Mateo the warehouse clubs are seriously mad houses.

Warehouse clubs make a lot of sense for families with a lot of storage space and the ability to consume large quantities of food without waste, but for us it just was not working out. Interestingly enough most of these warehouses make a large part of their profits through the membership fees, and not through their merchandise. So it would seem that many members may be underutilizing their memberships. If you have one of these memberships, look back on how much you used it in a year and how much you actually saved to determine whether or not it is worthwhile.

What do you think? Are you saving money through a wholesale club or are you throwing money away on a membership?

