What we'll cover
How to evaluate your subscriptions
Avoiding duplicates, offers and scams
Automating savings to put your goals first
Whether you’re looking for everyday basics or something to spice up your life, there’s a subscription service for just about anything. Many are so easy to sign up for that you’re probably receiving at least one already for monthly entertainment, food, or retail services. This is all relatively harmless unless you’re in the habit of setting up autopay and forgetting about it. This is where we come in as your ally. Here’s what you need to know about subscription services.
According to a Bankrate survey, people spend around $348 a year on monthly subscriptions that they may not use. It’s likely that you pay for these services with automatic payments. Your credit card is charged a predetermined amount or your checking account is debited each month, and the delivery of your choice arrives on schedule. Convenient, yes — but risky, too.
As convenient and easy signups are for subscription services, it’s just as easy to forget about the monthly payments.
Losing track of monthly payments could leave you with an unexpected bill. See our dos and don’ts to help you manage your monthly subscription service payments.
Before adding another subscription to your list of monthly bills, “subscribe” to yourself instead by automating your savings goals with Ally Bank's smart savings tools. You’ll thank yourself later.
With subscriptions to manage on top of other monthly bills, keeping track of how much you’re spending on a monthly basis can often fall to the wayside. Each monthly fee may be small, but when you’re paying for multiple services, they can add up — fast.
Subscriptions can certainly make life easier, but if you’re not careful, the convenience can be costly.
Do these tips to successfully stay on top of your subscriptions.
Do...
1. Make a list. Would you be able to name all your subscription services and how much you pay for them? Do a self-audit of the services you subscribe to — a good way to catch them all is to simply go through your monthly statement from your checking account and credit card and write down the recurring payments.
2. And check it twice. Set a monthly alert on your phone to review and update your subscription list. Make sure you’re still regularly using everything you’re paying for. If not, cancel. Double check for redundancies, too. (Are you really binging HBO, Hulu, Netflix, and Amazon Prime Video?) If you find yourself missing any of the services you’ve canceled, you can always start it back up again.
3. Examine your financial statements, too. Double check that you’re getting charged the correct amounts and that prices haven’t increased by taking a couple minutes to cross-reference your checking account or credit card statement with your subscriptions list.
4. Stay two steps ahead. Online banking and mobile apps, like ours, make it easy to check in on your accounts daily. Before your automated payments are due, keep an eye on your outstanding credit card balance and verify that you have enough funds in your checking account to cover your withdrawals.
5. Build a smart budget. When building your budget, make sure you factor in your subscription services. When you see all those monthly costs next to each other, it may help you decide which services are worth the money.
6. Love it or leave it. Nothing beats front door delivery, an outfit specifically picked for you, or a click of a button to stream your favorite show. But, if you find that you’re not loving your experience or simply not wearing those shoes sent last month, it’s probably time to unsubscribe.
7. Subscribe to smart savings tools instead. Subscriptions services for essential items are often a no-brainer, especially when they fit within your budget. But for those not-so-needed items, what about saving that money instead? Ally Bank's smart savings tools are as easy and fast to activate. Start saving with us today.
Subscriptions can certainly make life easier, but if you’re not careful, the convenience can be costly. Keep an eagle eye on the total lump sum cost for the reality check you need to subscribe smarter.
Don’t be surprised by an unwanted monthly bill. Keep a lookout for these potential pitfalls of subscription services.
Don't...
1. Lose track of the total cost of your automated payments. This could leave you with an overdraft charge or a credit card bill that you can’t afford to pay in full. Other potential dangers include a price increase that goes unnoticed or a billing issue where you’re charged more than you should be. See above “dos” list for tips on how to avoid any unwanted surprises.
2. Fly blind with free trials. Many subscription services offer free trials (or a discount) on your first order, which you can use as an opportunity to determine whether or not you think the items are worth it. Take note: In some instances, when you sign up for a free trial, you’re automatically subscribed to the service. If you decide you don’t want to continue, be sure to cancel your subscription before the billing date.
3. Assume subscriptions are the cheapest option. Subscriptions offer the convenience of bringing both your needs and your wants to your front door. But unless you’re careful, they could cost you more in the long run. Be smart about what you enroll in: Compare how much it would cost you to go to the store to purchase your items versus subscribing to them. And if you have any subscriptions that you don’t really use, consider cancelling them.
4. Fall victim to online scams. When it comes to scam victims, younger and more savvy people are falling for the same tricks. Facebook and Instagram are common platforms where scams happen, typically, involving fake online stores, the sale of phony tickets to events, and undelivered or “not as advertised” items. Read these tips top-of-mind to help keep your money out of the hands of crafty cyber scammers.
It’s easy to fall into the habit of getting carried away with subscription services and monthly autopay — but by following our tips above, you’ll be closer to building a better habit when it comes to your subscription services.
