Do you have both Walmart+ and Amazon Prime? Or an Audible subscription that you haven’t used in months? From dog treat boxes to TV streaming plans, there are countless subscriptions out there. And it’s no surprise that many businesses have moved to subscription models: customers sign up for them, keep paying for them, and sometimes even forget about them. For this reason, it’s very important to regularly review your current subscriptions and cancel those that you’re not actively using, or don’t really need.
Here are some tips to help you cut back on subscriptions and reclaim your budget:
- Review your credit card and bank statements to identify all of your subscriptions. Go line by line through your financial statements to identify which subscriptions you’re currently paying for. Be sure to go back a full twelve months so you don’t overlook annual subscriptions. You should also jot down the amount you’re paying monthly for each subscription. If it’s a yearly subscription, divide the annual cost by twelve so you can see how it impacts your monthly budget.
- Categorize your subscriptions. It’s important to focus on subscriptions that overlap. For example, do you really need cable, Hulu, Netflix, and Disney Plus? To truly understand how much you are really spending for a particular service, you should take your list of active subscriptions, along with their monthly costs, and lump them into categories. This will help you better understand where you are overspending and where it might make sense to cut back. Common subscription categories include:
• Video streaming and cable TV
• Music subscriptions
• Video game subscriptions
• Internet service
• Cell phone/landline phone service
• Web hosting
• Health apps
• Fitness apps/personal training/gym memberships
• Productivity apps
• Dating services
• Pet product subscriptions
• Protection plans
• Cloud storage
• Identity theft protection and monitoring
• News/magazine subscriptions
• Clothing subscriptions
• Makeup subscriptions
• Book/audiobook subscriptions
• Home security monitoring
• Meal kits/meal delivery
• Family history or genealogy subscriptions
- Cancel unwanted subscriptions. Once you’ve determined which subscriptions you can do without, make it a point to cancel them. If the subscription is annual and you’ve already paid for it through the next several months, you can usually call the company or visit their website or app to prevent it from auto-renewing. If you do so, make a calendar reminder to check it closer to the renewal date to ensure you won’t be charged.
- Seek cost savings on the subscriptions you want to keep. For the subscriptions you want to continue with, it’s worth evaluating less expensive alternatives. Is there a lower-tiered plan that could meet your needs? Sometimes calling the company and inquiring about lower prices, or hinting that you are contemplating cancelation, can help you score a better deal. If you currently have a monthly plan, you may want to see how much you could save by paying annually instead.
- Be smart about free trials in the future. One of the most common ways of getting sucked into a subscription is by opting into a limited time free trial. Any time you have to provide your credit card or debit card information upfront for a free trial, you should be proactive about scheduling a reminder prior to the end of the free trial so you can cancel it before you’re charged.
- Monitor your subscriptions for price increases. It’s also important to stay on top of your subscriptions on a monthly basis to ensure you have a good grasp on the exact amount you’re being charged. It’s not uncommon for subscription prices to go up every year or so. Check your bank and credit card statements monthly, and if you do notice a price increase, you should reevaluate whether the service is worth continuing.
- Take advantage of the money you’re saving. Once you do cut back on your unnecessary subscriptions, you should calculate how much money you’re saving each month. Putting that extra cash into a high-interest savings account could help it grow quickly. For example, if you can free up $200 a month by canceling some of your subscriptions, and you put that money in a high-interest savings account earning 1.50% APY, you could save more than $12,000 in just five years! An online savings calculator can help you better understand your savings potential.
Even if it doesn’t feel like you have a lot of subscription-based services, you should do a deep dive into them at least once a year. You may be surprised at how many you can live without. By taking some time to review your recurring charges you can help identify and eliminate wasteful spending and maximize your savings. If you’re interested in finding a savings account with a competitive interest rate to best take advantage of the money you’re saving, consider our High-Interest Savings and Jumbo Savings accounts, or apply online today.