Save money with smart subscription management

Subscriptions can seem like magic. For a monthly payment you may barely even notice, ready-to-eat meals or the TV series you love are delivered reliably to your door or your screen.  

The automatic monthly charges that make subscriptions so convenient, though, can make unused subscriptions a silent drain on your budget: 

• In a US survey by C&R Research, consumers underestimated their monthly spend on subscriptions by $133.   
• Meanwhile, research by Citizens Advice found that UK residents spend the equivalent of $400 million per year on unused subscriptions. 

Read on to better understand how much you could be saving, plus learn strategies to keep subscriptions under control. 

How an unused subscription can add up fast 

Suppose you subscribe to a streaming service for $9.95 per month. The amount sounds small — in New York City, this might be equal to two cups of coffee. 

After a year, though, you realize you have not watched the streaming service at all. You cancel immediately, but after 12 months you have paid $119.40. If the streaming service also included a $5.00 monthly add-on, the cost after 12 months becomes $179.40. 

Money spent on a service you do not use or enjoy is bad enough. But consider also what your $179.40 might have earned toward your retirement. If you invested $179.40 per year for 30 years at a 7% rate of return, for example, you would come away with more than $19,000.  

Unused subscriptions can impact your budget silently, sometimes for years. Fortunately, there are simple ways to evaluate your existing subscriptions and ensure that new ones stay manageable. 

Strategies for eliminating unused and unnecessary subscriptions 

Do a subscription audit 

If you are not even sure what subscriptions you might have, start here. A subscription audit is a way to gain a full overview of your subscriptions — valuable ones, forgotten ones, and everything in between. 

To audit your subscriptions: 

• Review your account statements. First, note any recurring charges in your bank and/or credit card statements. You may want to review an entire year’s worth of statements because some subscriptions are charged annually.  
• Consider your alternatives. For the subscriptions you find, ask yourself: 
  • Do I use it regularly?  
  • If there are tiers, do I need the tier to which I currently subscribe? Or might I receive just as much value after downgrading?  
  • If there are add-ons, do I need the ones for which I have opted in? 
  • Are there cheap or free services that might work just as well? 
• Cancel subscriptions you do not need or use. Keep in mind that canceling may be more difficult than signing up. The company may try to tempt you to stay subscribed using a discount or other offer. Or you may need to refer back to the terms and conditions for instructions. 

Try a subscription cleanse 

If you are unsure which of your subscriptions are truly worthwhile, try pausing or canceling all of them for a month. (You may also see this described as a “subscription fast,” but the concept is the same.) 

This strategy lets you compare what life is like with and without your various subscriptions. You may find, for example, that you are just as happy exercising in the park as you are going to the gym. You can always restart the subscriptions that do genuinely provide value. 

Tips to keep new subscriptions manageable

Some simple steps can help ensure that new subscriptions stay easy to track and adjust in the future:

• Review the terms and conditions for important details. No one sits down with terms and conditions for an exciting read, but you will want to make note of: 
  • How often you will be charged 
  • How long any free trial will last 
  • The steps to cancel 
  • Other charges you may be responsible for 
• Set a calendar reminder for free trials. At the end of a free trial, you will often be charged automatically for the first month of service. With a calendar reminder, you can make a conscious decision instead. (Also watch for the option to unsubscribe immediately but continue using the service until your free trial ends.) 
• Consider using the same debit or credit card for all your subscriptions. This way, when you audit your subscriptions in the future, you will only need to review one set of statements. 
• Look for opportunities to group payment dates. If subscription services and your income allow, grouping payment dates together can help with monthly budgeting. 
• Watch for price increases. Keep in mind that prices may go up, especially during December and January. 
• Turn off auto-renewal. We love automating financial tasks (especially payroll deposit). For subscriptions, though, consider giving yourself a yearly opportunity to reevaluate by manually renewing instead.