It wasn’t too long ago that subscription services were limited to basic utilities, television and maybe a newspaper. Now, we live in a world of ever-expanding options and access. So it’s not unusual to have a monthly bill for Amazon Prime, Spotify, Netflix, Disney +, razor and toilet paper refills, a beer of the month club, cloud storage, digital magazines and so much more.
In fact, the subscription economy is booming. It’s predicted that more than £2 billion every year is spent on the subscription market in the UK. This includes two out of every three Brits subscribed to Amazon Prime. And more than one in four are signed up to subscription boxes.
How to manage monthly subscriptions
People tend to sign up for subscriptions for convenience, access and enjoyment. And the subscription model makes it easy: you enter your account details once and you don’t worry about it again.
Of course, this is where the problem lies. The costs of multiple “affordable” subscriptions quickly add up. And people often find themselves paying for services they aren’t using. Or they aren’t getting as much enjoyment from as expected – yet can’t be bothered cancelling.
If you're not keeping track, unexpected or infrequently billed subscriptions can slowly drain and topple your budget, causing you to go into your overdraft.
Tips to manage your monthly subscriptions
If you want to give your subscription list a “spring cleaning”, there are a few basic steps.
Know what you're paying for. You want to keep track of all subscription payments and how much you are spending on them each month and year. You can scan your bank statement, but if you have several subscriptions at varying costs with different billing dates, it’s easy for this detail to get lost in the mix.
Instead, download an app that can consolidate your finances and give you a clear picture. Money Dashboard makes this easy by automatically tagging and categorising monthly outgoings like subscription payments.
Figure out how what you want to keep and how much you have to spend. If you feel you are busting your budget with subscriptions, it’s easy to use an app to add up the total.
If you want to play with the numbers to see what you can afford, link into the Balance After Bills feature in Money Dashboard to see what your 'safe to spend' number is after subtracting your anticipated monthly outgoings.
If your suspicions are correct and you want (or need) to cut back spending in this area, it’s time to have a think about your subscription priorities. What do you use most? What is giving you the best value?
Cancel unused subscriptions and free trails. After you make the decision to cut the cord there will likely be a few life-admin barriers to execution.
Some companies make cancelling subscriptions as easy as clicking “cancel” on their website. But others make it difficult. They may require you to phone up during business hours. During the call they will try to keep you as a customer, or even offer a discount price or cheaper option to keep you on.
Don’t be discouraged by obstacles to cancel subscriptions. Pick up the phone, send that email, reset your forgotten password to login to that website, and cancel what you need to. You’ll be rewarded with stronger finances and may stop yourself from unexpectedly going into overdraft.
Beware of subscription scams. It’s not unusual for scammers to pull money from accounts in regular monthly instalments. People may not notice for a long time in the midst of all other regular monthly outgoings. So if anything looks suspicious in your bank and credit statements look into it online and in your email records. If you’re unsure, call your credit card company and they should be able to cancel payments for you.
