How Much are You Paying for Subscriptions?
The definition of a subscription is something for which you pay in advance that allows you to collect some sort product or service. But how often do you evaluate whether your subscription(s) is really benefiting you? Now, you might be thinking, “why would someone sign up for something without getting anything from it, especially if they are paying for it?” You might be surprised as it happens a lot more often than we would think.
MarketWatch.com released an article called “You’re Spending More on your Subscription Services than you Think” in which research was completed on the use of subscriptions. The beginning of this article mainly focused on electronic subscription services rather than newspaper and magazine services. In the research, 2,500 people were surveyed. One of the first questions asked participants what they thought they were spending each month on their subscriptions. The majority of the people had guessed they were spending around $80 a month on general subscriptions. They were then asked a second time about specific services like Amazon, Netflix, Dollar Shave Club, Apple Music, and Spotify and in response they added $30 to their original estimate. The third time, the participants were asked to actually look up what they were spending on subscriptions each month. After being shown a list of different subscriptions and fact checking their own bank accounts, they had realized that they were spending approximately $240 on the different subscriptions on average each month. That is $160 more per month than originally guessed which totals $1,920 more per year than originally anticipated.
While the people surveyed were random, and not necessarily college students, college students can also fall into the same trap of underestimating how much they are spending on subscriptions. Whether it is paying for gaming passes, video streaming services like Netflix and Hulu, music streaming services like Apple Music and Spotify, or health related subscriptions like Dollar Shave Club and Fitbit, college students are still just as susceptible to paying for these things without realizing the real impact on their finances.
I was once in a conversation with a student paying for both Apple Music and Spotify because they had liked each music program and used both as well. As this individual thought about it, they realized both subscriptions provided a very similar service/product. They did not have a reason for using both apps. That is just what they had always done, and that particular student had never thought about it. In the end, they decided not to spend extra money on a second service/product that did a similar thing.
When was the last time you evaluated your subscriptions? Have any of your subscriptions been forgotten? Are they still providing you a useful product or service? It is totally up to you whether you are receiving benefit from having those subscriptions or not, but take some time to think about what benefits you are getting from those services and if it is worth the amount of money you are paying for it.
To learn more about the subscription research through Marketwatch.com, you can use the following link: