Costco Engagement Rings. Don’t Do It

Are Costco Engagement Rings a Good Value?

During Costco’s latest earnings call, they let it slip that their e-commerce sales in the past quarter were boosted by a single very large engagement ring sale. How large? Well, at the time that revelation was made, Costco had an engagement ring listed on their site for over $400,000. In order to make a blip in their sales numbers, the ring would have to have been at least that expensive, if not more.

While I absolutely LOVE Costco for vats of Nutella, bulk packs of dental floss, and of course, Churros. I can’t advocate shopping with them for engagement rings, for a number of reasons which I will list out below.

While you may be able to save a little bit over retail jewelers like Kay, Jared and Zales when shopping at Costco, you’ll never get close to the savings that can be had when you buy a ring online. Interestingly, this shopper who skewed the online sales results chose to purchase their ring online from Costo.com, and in doing so, surely overpaid.

Costco Engagement Ring Price Breakdown

One good thing I can say about Costco is that they sell GIA certified diamonds. That’s one of my #1 tips when buying an engagement ring online. And, by selling GIA certified stones, they make it really easy to do a quick apples-to-apples price comparison online and see if you’re getting a good deal.

Take this ring, currently being offered at Costco for $46,999.99

The GIA Certificate which Costco makes available on their site states that the ring has the following specs:

Carat: 2.10, Color: D Clarity: VVS2 Cut: Excellent Fluorescence: None

I entered these same parameters into the diamond search tool at James Allen, since they have one of the largest online diamond databases, to see what I could find in terms of comparable stones.

This diamond is truly spectacular and is priced in-line with stones with the same parameters available online at James Allen and Blue Nile, two of the top online engagement ring jewelers. Compared to retail jewelers like Jared and Kay, this ring is probably an even better value for a diamond with these exact specs. So what’s the issue?

For the shopper looking to save money on an engagement ring, a D color VVS2 diamond is not always a smart pick. Only about 8% of engagement ring shoppers opt for a D color diamond, vs 44% of shoppers who pick a lower grade G, H or I stone which is also rated as “colorless” but comes at a steep price discount.  Another 15% of engagement ring shoppers pick a K colored diamond to save even more.

Setting a $1000 platinum 6-prong setting with a similarly cut H color 2.1 carat diamond would only cost you $21,000 – a savings of $26,000 over this ring from Costco.

Customize a ring at James Allen for less than the Costco alternative

What you’re not getting when you shop at Costco is the ability to select a diamond to optimize for the features most important to you – whether that be size (carat), color, cut or clarity. 

Plus, when you’re spending this much for an engagement ring don’t you want to be able to see the diamond up close first?

Costco vs Tiffany & Co. Diamond Engagement Ring

Buying an engagement ring from Costco will always save you money over an engagement ring from Tiffany & Co. Period. Diamonds, platinum and gold are all commodities, and to pay more for a brand name when there are many high-quality Tiffany & Co. cheater rings out there is madness – IMHO. But, if you’re looking to save money, I still suggest you bypass Costco and head to a site like Blue Nile or James Allen where you can set your search parameters to match the stringent diamond guidelines that Tiffany & Co. sets for their diamonds and get their signature sparkle for less.

Does Costco Resize Engagement Rings?

Costco does not resize the rings they sell. So, if you’re finger is not the size 7 that they are selling, you’ll have to get your ring resized at an independent jeweler. How much does it cost to resize a ring? Well, if it’s a simple setting and you’re only going up or down a single size it could be as little as $20. But for more complex settings or a larger size difference could cost you up to $150.

When you build your own ring online you won’t incur this cost. And, many online jewelers offer free resizing in the future should your finger size change. 

Does Costco Offer a Jewelry Warranty?

When you buy an engagement ring from Costco you are largely on your own. When I chatted with their online rep they suggested to immediately insure the purchase in order to protect your investment. Good advice, to be sure, but compared to others selling engagement rings online their offering is severely lacking. Check out the Blue Nile and James Allen warranties which include prong tightening, rhodium plating, re-polishing, and cleaning. All services you won’t get if you buy your engagement ring from Costco.

Does Costco Offer Jewelry Financing?

Again, the answer is no. When it comes to financing an engagement ring, retailers who are set up to specifically sell jewelry are able to offer this option, but Costco is not. James Allen, Blue Nile and even Amazon all offer engagement ring financing options which will allow you to get that ring on her finger sooner. If you’re set on buying from Costco you’ll have to find another means of financing – like a personal credit card, or a loan from mom and dad.

Should You Buy an Engagement Ring at Costco?

In summary, my answer is No. While Costco does sell some impressive diamonds at fair prices, I don’t believe it is ever a good idea to purchase a pre-set engagement ring when you’re shopping in the $5,000+ range. You’ll have better control of your budget and be able to optimize for your own priorities – be they carat size, color, cut or clarity, when you purchase a loose diamond and the setting of your choice and have it custom made by a jeweler committed to craftsmanship and customer service.