Money

Subscription Services… A Gain, Drain, or Prescription for Broke?

Photo Courtesy of http://TaxRebate.org.uk

Today there seems to be new subscription services available to consumers every single month.  There are over 7000 subscription box services alone!  These services can be an amazing time-saving and money-saving opportunity if used judiciously.

However, as consumers, we have to be careful not to drain down our checking accounts with automatic “thoughtless” payments.  We can end up allowing companies to conveniently take our money away while we stand back and smile – oftentimes unaware of the real costs.  Perhaps they do not provide a real value nor are they really convenient for our bottom lines.

As a consumer, the choices can be overwhelming, especially if you’re careful about your monthly expenditures.  There wouldn’t be this many subscription services if they weren’t an excellent way for companies to take money away from you.

The Bucket Analogy

Imagine your accounts are a bucket to hold your money.  Your money is the water.  Your job and other sources of income are the faucets.  Subscriptions are like holes drilled into your bucket.  Some holes are big, most are small.  But if you have too many holes draining your money out of your bucket than you can’t ever keep enough water in it.  No matter how much water comes from your faucet.

A List of Subscription Services Available

See how many holes are in your bucket.  Here is a list of subscription services:

 

TV Entertainment Monthly Cost Yearly Cost
Netflix $10.99 $131.88
Amazon Prime Video   $8.99 $107.88 or
Amazon Prime Membership $120.00
Hulu   $7.99   $95.88
Sling TV $20.00 $240.00
HBO Now $14.99 $179.88
Youtube TV $40.00 $480.00
Playstation Vue $39.99 $479.88
Cable (the cheapest I could find) $18.40 $220.80

Note: These are all base rates and may not include taxes and fees.  Subject to change

 

Music Monthly Cost Yearly Cost
Spotify  $9.99 $119.88
Pandora Premium  $9.99 $119.88
Apple Music  $9.99 $119.88

Note: These are all base rates and may not include taxes and fees.  Subject to change.

 

Products Delivered (Box Services) Monthly Cost Yearly Cost
Barkbox (dog treats & toys) $21.00 $252.00
Birchbox (Beauty/Grooming) $10.00 $110.00 or $120.00
HelloFresh (Meals) $69.00 per week (6 meals) $3588.00
Blue Apron (Meals) $59.94 per week (6 meals) $3116.88
Harry’s (Shaving/Grooming)  $3.00 $36.00

Note: These are all base rates and may not include taxes and fees.  Subject to change.

Your Prescription for Subscriptions

  1. Take a look at your accounts and see what costs are being deducted.  Pay close attention to the monthly totals from your checking.  Look for hidden charges, fees, and also for charges that you weren’t aware you signed up for.
  2. Determine the true yearly cost for each subscription.  Monthly cost x 12 = yearly cost.  Ask yourself… are the yearly costs worth it?  Be honest with yourself.
  3. Factor in convenience, speed of delivery, choice, along with additional fees, shipping charges, etc to determine the true value.
  4. Eliminate any subscriptions that you don’t feel add enough value for you and your household.  Contact the companies and end the services as soon as you can.  Many subscription services are month-to-month…some are not. Read the fine print on the contract and look for Early Termination Clauses.  Be careful not to end contracts early because you could be hit with a hefty fine for early termination.

Summary

Subscription services can be both a great way to enjoy entertainment, products, and gain value in your life.  The convenience, availability, and quality can be amazing.  However, they can also be a considerable drain on your finances and must be carefully evaluated beforehand.

 

 

 

3 Comments

  • Rachel

    Good reminder for me to cancel our one cable service with Comcast and why it’s ok to not have Netflix and hulu when we already have amazon and hbo. I hate paying for TV but ESPN is a requirement in our household!

  • oprol evorter

    Hey There. I found your blog using msn. This is a really well written article. I’ll be sure to bookmark it and come back to read more of your useful information. Thanks for the post. I will definitely comeback.

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