ARE SUBSCRIPTIONS REDUCING YOUR CASH FLOW?
Joseph Garcia, MS-HRM, SPHR, ChFC, CFEd
Senior Human Resource Business Partner | Global HR Experience | Veteran Advocate | Wealth Mindset | Certified Financial Educator| Chartered Financial Consultant
Most Americans don’t know the cost of their subscriptions. Are you one of them?
A recent survey revealed that 83% of respondents underestimated their subscription spending by a wide margin.1 On average, they thought subscriptions only cost them $80 per month. In reality, it was over $230.
That was back in 2018. Since the COVID-19 Pandemic started in 2020, that number has dramatically increased. A 2020 survey discovered that, on average, consumers added $192 in new subscriptions after lock downs started.2 And digital ecommerce subscriptions were expected to grow from $72.91 billion in 2021 to $120.04 billion in 2022.3
The takeaway??Subscriptions might be consuming more of your cash flow than you realize.
Scroll through the apps on your phone. Are there streaming, dating, or wellness subscriptions that you pay for but never use? Unsubscribe and uninstall them!
If you and your family regularly use a streaming service, consider cancelling your cable subscription. They’re expensive, and your streaming services probably carry your favorite shows as it is.
It’s also worth investigating the value of any subscription boxes you receive. Is a monthly shipment of makeup or comic books significantly improving your life? Or do most of the items go unused? If the latter is true, consider cancelling your subscription.
Once you’ve cleared out unnecessary subscriptions, you might be surprised by how much cash flow you’ve freed up for reducing debt or building wealth.
1 “You probably spend more on subscriptions than you realize,†Angela Moscaritolo,?Mashable, Feb 20, 2019,?https://mashable.com/article/you-probably-spend-more-on-subscriptions-that-you-realize/
2 “Americans More Than Tripled Subscription Service Spending Amid Social Distancing,†David Dykes,?Greenville Business Magazine, May 14, 2020,?https://www.greenvillebusinessmag.com/2020/05/14/308970/americans-more-than-tripled-subscription-service-spending-amid-social-distancing
3 “The Growth Of Subscription Commerce,†Jia Wertz,?Forbes,?Jul 15, 2022,?https://www.forbes.com/sites/jiawertz/2022/07/15/the-growth-of-subscription-commerce/?sh=24153283b572