Internet addiction and warnings of overuse leading to eye strain, neck and headache pain, carpal tunnel, depression, anxiety and other mental health issues are not new concepts. For well over a decade, we have received warnings about the downfall of too much time spent online and the importance of limiting screen time for kids.
What may surprise you is that excessive internet use can lead to other compulsive behaviors such as gaming, online relationships, stock trade or investment, sexual behaviors, gambling, social media and shopping “addictions,” all of which lead to well-documented financial, professional and personal problems. Perhaps the easiest financial pitfall is impulse buys and subscriptions to products and services.
Thanks to mobile devices, technology and the internet; there are endless convenient ways to spend money. You can:
- Order practically anything now and have it delivered to your door, sometimes the same day.
- Fully customize your television experience thanks to a dozen or so streaming services.
- Have an entire box of various grooming products and surprises delivered to your home.
- Sign up for monthly delivery of beer, a new wine each month, a monthly cheese club, or candy of the month.
Unfortunately, subscription and membership services can levy more damage to your finances than other types of purchases because of the automatic monthly charges to your debit card or credit card. Because these recurring charges are often for small amounts, it’s far too easy to keep in perpetuity—or to forget about them altogether.
How Many Subscriptions Do You Pay For? Having select cuts of meat from humanely-raised animals, or a set of razors delivered to your house each month does sound nice, but there are financial consequences that often accompany these subscriptions. It’s easy to see why this is a problem—consumers often underestimate how much they actually spend on subscriptions each month. It’s one thing to pay for common subscriptions like mobile phone service and internet access for your home. But it’s just as easy to go down the subscription rabbit hole and start signing up for weekly meal delivery, lifestyle subscriptions, and surprise boxes of treats for your pets.
Spending more than you realize on subscriptions is a windfall for companies operating with this model, but can ruin your budget. If you’re not saving and investing enough to reach short- and long-term financial goals, then these subscriptions are twice as detrimental. With that in mind, gather data and evaluate the amount of money you’re paying for subscriptions so you can determine whether you’re spending too much or just the right amount.
How to Take Stock of Your Subscriptions. If you’re no longer sure which subscriptions you’re paying for, there are several apps and services that can help. For example, TrueBill lets you use your phone to provide a look at all your regular and recurring charges, including subscription services. This app even cancels unwanted subscriptions on your behalf with the goal of helping you reduce financial waste so you can save more money over time.
Trim is another app that performs a variety of services, including an in-depth analysis of your regular spending. This app goes the extra mile to negotiate cable, internet, phone, and medical bills on your behalf, but it will also cancel old and unwanted subscriptions you have and more. Trim claims to have the lowest pricing in the industry and boasts that their success fee only applies if they lower your internet, cable or phone bills. Everything else is free.
If you don’t want to use an app or a third party, you can also take stock of your subscriptions on your own. To do this, review your last six months of eStatements and credit card bills to identify subscription charges. From there, figure out which ones to keep or cut, then cancel them online or call each company you decide to eliminate.
Now Is the Perfect Time to Cut Subscriptions You Don’t Use. It’s possible too many subscriptions that automatically chip away at your income each month are standing in the way of achieving financial wellness. With the new year fast approaching, now is the perfect time to take stock of your financial position and look for ways to improve it, especially if you’re paying down debt or not saving any money. One way to pay off debt is by obtaining a zero percent balance transfer credit card.
No matter how fun it is to have toys and treats for your pet magically show up at your doorstep each month, it’s important to consider which subscription services add value to your life— and which ones are frivolous. Your cellphone is probably a necessity, but the Marshmallow of the Month Club is not. If you’re struggling to save money, non-essential subscriptions should be the first line items to cut on your budget.
Keep in mind that many subscription services often increase in price over time. Low upfront pricing model is part of their business model. Examples most people would recognize are streaming services and Amazon Prime membership. If your goal is to grow your savings for a rainy day and retire by a target date, it’s time to commit to nipping excessive subscriptions in the bud—before they send your finances into a tailspin.
Resources: BBC.com, Everyday Health, Inc., Forbes, TRIM, Truebill, verywellhealth.com, Wall Street Journal