Time to Evaluate all your Subscription Services!
Let me ask you honestly, how much do you pay in subscription on a month to month basis. The truth is you probably do not know because it happens and you move on to the next thing. NETFLIX. DISNEY+. HULU. HBO. BLUE APRON. AND so many other subscription services take money from our account on a monthly basis without us really thinking about it. In finance, there is phrase called “stickiness” which relates to how companies create products and processes to not only get the customer but to keep them. The best way to create a product that creates stickiness is to remove friction. One of the biggest friction is paying for something manually and having the option to think about it. With automatic deductions, you are free from thought. Whether this is a bad thing or good thing depends on your lifestyle and whether you can afford all the subscriptions you are paying for on a month to month basis. The real question is are you really using all the things you are constantly paying for.
The problem is we sign up for subscription program or services we barely use, but they still take our money. For instance, this is my relationship with the gym. I recently started going to the gym. I am not sure why I chose to start during a global pandemic, but I did. If you want to judge me, I understand. I am judging myself. Every month for the past two months $12.99 is automaticallly taken from my account which isn’t bad, but this does not including the annual fee of $50 and the one time enrollment fee. The gym is definitely taking my money! If you ask me how many times I have been to the gym since I started two months ago I will embrassily tell you 10 times. I know. I know. I told you I am judging myself . In a 60 day span less, I have utilized the service about than 16%, yet I have paid over $60 for a service I barely use. It is truly a shame.
Now Neva Broke Family, let us to a thinking exercises. Let us do a quick calculation with this hypothetical situation to see how much you may be spending in a monthly and annual basis.
As of September 9, 2020 the price for the following:
- Netflix Basic $8.99/month | Standard $12.99/month |Premium $15.99/month
- Disney+ $6.99/month or $69.99/year
- Hulu $5.99/month or $59.99/year |No Ads $11.99/month |Hulu + Live TV $54.99/month| Hulu (No Ads) + Live TV $60.99/month
- Gym $12.99/month
If we calculate Netflix ($12.99) + Disney ($6.99) + Hulu ($5.99) + Gym ($12.99) = Monthly total: $38.96 | Annual Total: $467.52**
**This is not inclusive of tax**
“Change your habits to change your financial future.”
Sometimes it is not about making more money, but carefully managing the money you do have. If you are looking to stretch your money and create more cash, especially in the midst of a COVID-19 world, look very closely at your expenses. You may be able to free up money to use for other things. Most importantly look at the subscriptions you signed up for that take your money every month without you noticing. Ask yourself if you really need all the streaming services or if you are ever going to go to the gym (this one was directed at myself). In order to achieve our financial goals, we sometimes must make the sacrifices now in order to reap the results later.
What actionable steps are you taking towards financial independence or financial abundance? Let us know.
