We’re all creatures of habit, so much so that research shows nearly half of everything we do in a day is habitual. Subscriptions cater to that behavior, seamlessly charging us monthly or annually for an ongoing product or service.
Most likely you’re no stranger to the subscription model. From music, TV and audiobook streaming to your monthly toilet paper delivery, you can subscribe to more today than ever before. While some subscriptions provide real value, there’s a good chance that you have at least a couple of subscriptions you no longer use on a regular basis.
The pandemic drove a surge in popularity for subscriptions, especially for stay-at-home services, such as grocery delivery, and some of it stuck. For example, meal kit orders were up 36 percent as of June 2022 compared with January 2020, according to a recent study in the Columbia Business Journal.
Many businesses automatically renew your subscription if you don’t cancel before the next billing cycle, sometimes without notifying you. That can take a toll on your finances, especially at a time when providers are raising prices.
One cost-saving strategy is to share subscription services. Most services are amenable to sharing; they often offer various profiles on a single account. But piggybackers beware: Some services, such as Netflix, have signaled an imminent crackdown on account sharing.
Here are other strategies to stay on top of your subscriptions:
Find out how much you pay per month for subscriptions by reviewing your credit card charges, with a focus on recurring payments. Alternatively, use a free budgeting app that offers subscription monitoring, such as Mint (https://mint.intuit.com) or PocketGuard (https://pocketguard.com). There are also apps designed specifically to help you monitor subscriptions, such as RocketMoney (https://www.rocketmoney.com), formerly known as TrueBill; Trim (https://www.asktrim.com); and Bobby (https://bobbyapp.co).
These platforms will also help you calculate how much you’re paying—which could come as a surprise. Although Americans spend an average of $219 per month on subscriptions, when asked how much they believe they spend, the average estimate was $86, according to a study by C+R Research.
In 2020, when the pandemic led to a spike in subscription spending, millennials spent, on average, more than $300 a month on subscriptions—the most among all age groups—according to a survey by LendingTree.
As you review your subscriptions, consider ranking them by how much you value the service. If you divide the monthly or annual cost of each subscription by the number of times you use it, what’s the cost per use? If that number seems high, consider switching to an ad-supported version of the service or paying an annual rather than a monthly fee if that would cost less. Or simply unsubscribe.
Unlike some long-term contracts, subscription services are usually easy to cancel. There’s usually no penalty, and you can sometimes “pause” a subscription, which means you can keep your account without being charged.
(Emma Patch is a staff writer at Kiplinger’s Personal Finance magazine. For more on this and similar money topics, visit Kiplinger.com.)
