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Sam's Club or Costco: Which Warehouse Club Is Right for You?

There's more to evaluating warehouse clubs than the cost of their groceries and merchandise.

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Costco or Sam's? The debate has raged for years and typically involves a pricing breakdown of each warehouse retail giant. But what most comparisons fail to cover are all the intangibles that a membership brings — things like the return policy and member services that you probably didn't know exist until now. Here's how the two warehouse giants stack up so you can make an informed decision:

See Also on Kiplinger: 12 Secrets Costco Shoppers Need to Know

Return Policy (Winner: Costco)

Costco has a legendary return policy which states they'll allow you to return any item, at any time, no questions asked.

Unfortunately, their policy was abused in recent years, especially on electronics, and has changed to a 90-day return policy on computers, TVs, tablets, cameras, cellphones, and the like. But what makes Costco's return policy so amazing is that you can bring items back for a full refund without the original packaging, and without your receipt, as they have a record of all your purchases in their system. I was recently able to bring back a Keurig coffee maker that stopped working six months after I purchased it, and they gave me full refund, no questions asked. The only items you flat-out can't return at Costco are alcohol, cigarettes, and special orders.

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The Sam's Club return policy is solid but not quite as attractive. Like Costco, you can return most items at any time for a full refund. But what makes their return policy less attractive is their long list of exceptions. For example, similar to Costco, you have 90 days to return electronics like TVs, computers, and cameras. But this 90-day policy at Sam's also extends to unopened movies, music, and software. Also, you only have 14 days to return connected devices like cellphones and tablets, and they must be returned to same store where you purchased them.

Furthermore, unlike Costco, Sam's highly recommends that products are returned in their original packaging and you have your receipt in hand. If you don't have either, they claim they'll do their best to process your return, but they reserve the right to deny it. Popular items that you can't return to Sam's Club include alcohol, prescriptions, tickets, tobacco products, and gift cards.

Credit Card (Winner: Costco)

Both stores offer a co-branded credit card. However, Costco’s new Anywhere Visa Card includes rewards for Costco purchases, which is really the whole point of using a co-branded card. Why would you sign up for a Sam’s Club credit card if it only gives you the minimum 1% cash back on Sam’s Club purchases that any cash rewards credit card could offer? This used to be the case with Costco’s credit card, too, but with its recent card change, it now offers 2% cash back on all Costco purchases, 3% cash back on eligible travel (including Costco Travel) and restaurant purchases, and 4% cash back on eligible gas fill-ups (up to $7,000 in purchases per year).

Lower Prices (Winner: Toss-Up)

The brain-trust at Consumer Reports recently did a head-to-head pricing challenge between Sam's and Costco. Interestingly, they found that both clubs offered comparable prices across all departments in the warehouse. Many of the pricing discrepancies were merely regional and didn't hold true across all stores. Thus, they essentially called the two stores' pricing a tie and gave a slight advantage to Costco overall due mainly to customer service and product quality of the Kirkland brand. But keep in mind that this slight advantage to Costco comes with a $10-a-year higher price tag, as membership starts at $55 while Sam's starts at only $45. (See also on WiseBread.com: Wal-Mart vs. Sam's Club: Who Actually Has the Better Deals?)

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Better Coupons (Winner: Toss-Up)

In recent years, both wholesale clubs have gone to an "instant savings" coupon booklet which automatically loads club members' cards with discounts on specific items. That discount is then taken at the register, and you're not required to clip a coupon or even have the coupon book in your possession. Both clubs' coupon booklets last about 24 days before expiring. The Costco coupon booklet gets the nod in terms of savings on furniture, electronics, and gadgets, while the Sam's Club booklet has better savings on grocery and household items. In other words, one is not necessarily better than the other; they'll just appeal to different shoppers.

Services Provided (Winner: Costco)

Both clubs offer member services that extend way beyond a low price on toilet paper and chicken thighs. For example, both memberships come with pharmacy services, optical services, hearing aid services, auto buying programs, identity protection, insurance programs, and business payment processing, to name a few. But Costco gets the overall nod here, as they also offer a highly regarded mortgage service. Many members like it because it removes the guesswork out of the often murky loan fees associated with home mortgages. Their fee schedule is simple; $350 for executive members and $650 for gold star members. (See also on WiseBread.com: 10 Things You Probably Didn’t Know You Could Buy at Costco)

Membership Fee Discount (Winner: Sam's Club)

Costco rarely, if ever, offers a discount to entice new members to sign up. Sam's Club, on the other hand, is always throwing a bone or two to get new shoppers to test drive a membership. For example, they just recently had a deal where you could score the basic $45 Sam's Club membership along with $95 worth of upgrades and freebies that included a $20 gift card, free pizza, free cookies, and a free upgrade to the "Plus" membership. Don't sneeze at the membership upgrade — plus members are granted $10 back on every $500 spent, five free prescriptions per year, and early-morning access to the warehouse. They seem to run these types on "new member" deals and upgrades quarterly, so keep an eye out on their promotions page. (See also on WiseBread.com: These 6 Costco Items Will Easily Cover Your $55 Membership)

This article is from Kyle James of Wise Bread, an award-winning personal finance and credit card comparison website.

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This article is from Wise Bread, not the Kiplinger editorial staff.