The end of the month comes, along with a list of expenses to be paid. You seem to ask yourself the same question every time those bills roll in: “How have I spent so much money in such little time?”
Part of the answer may be subscription services, which put a price tag on simple pleasures in life, like watching TV or exercising.
The costs definitely add up.
“More online businesses are hoping you’ll sign up for their subscription service plans, with automatic monthly billings, until you decide to stop — or realize you’ve forgotten to cancel,” says USA Today.
Everything from your ice cream fix to your choice of media entertainment can be adding to a monthly total that may be more than you realize: Suddenly, you’re no longer feeling peaceful, but instead stressed about making ends meet.
Subscription economy dangers
“Subscription economy” is a term used to explain companies using monthly subscriptions instead of pay-per-product models for you to access their services. For example, you can purchase a $5 movie from a store, whereas a streaming service charges you higher monthly fees for an unlimited number of movies, as long as you’re willing to pay it. Either might be the better deal, depending on your use.
What seems harmless can easily become a lifestyle of unhealthy spending habits.
In the case of companies offering streamed movies, along with other subscription-based companies, there are “levels of quality,” with higher quality services costing more than basic services. Other perks and privileges are reserved for those willing to give additional money every month.
According to educational finance platform Next Gen Personal Finance, the average person spends over $200 on subscription services in a month.
In addition to that, per USA Today, the average American can spend surplus amounts on fitness, coffee, food delivery and many other subscription services without a second thought. There is a subscription service for almost every commodity you can imagine.
Avoiding the danger
Building simple habits in your day-to-day life can help you stay financially afloat. You can still watch your new favorite series without losing the extra money you want to keep.
- Simplify your life and create a budget plan. You can continue to prioritize needs over wants, but a budget plan may help make room for “play money.”
- Keep track of your subscription spending and personal finances! You can consider writing them down, or limiting the services to a few.
- Reviewing your bank statements can go a long way! If you see charges that are not familiar, you may still be attached to a subscription, even when you’ve changed your credit card. Financial educational platform Bankrate says, “Changing your credit card won’t necessarily stop the charges because credit card issuers will now update charges to your new credit card automatically.”
- Cancel unwanted subscriptions. If you are still being charged after cancellation, contact the credit card company.