The accidental split second can end up ruining a month’s worth of savings. Think about being overconfident when parking your car (“I still have some margin!”) or your cellphone hitting the floor when reaching for it with your fingertips from your bed.
Of course, the advice here could be to be more careful. That however seems rather obvious, doesn’t it? And on top of that, the chances of you actually paying more attention next time are rather slim. I, too, have obliterated the screen of my smartphone on more than 1 occasion (which did now prompt me to acquire a screen protector. A solid investment thus far).
Apart from those occasional mishaps that can wipe out several hundreds of euro’s, there is a far more silent but equally lethal threat to your savings: subscriptions.
The rise of the monthly payment
In a time when the physical product is slowly being pushed back, services are rising. Think about your music. Whereas in the past one would fork out a decent sum to buy the latest CD of your favorite band, you well… do nothing probably. Chances are quite high you pay a nice monthly fee to Spotify, a Swedish streaming-giant. For about 10 euros / month you have access to their vast catalog of artists. Very convenient.
If you live in a household likes to tuck in before the television, you might also pay a monthly fee to Netflix. Or perhaps you combine it with Amazon Prime and Disney+? The offers are rising and they have something in common. They are targeting your monthly, certain purchase. Very often you pay this via your credit card and you hardly notice it flowing out of your pocket. Add up these subscriptions though, and you will notice that they actually can take up quite a significant amount of your monthly pay.
Take a look at this study from 2018 by ING, a Dutch bank, which states that the average European household spends about €130 a month on average on subscriptions (ING, 2018).
Throwing out digital television
I will not go on an anti-Netflix rant. Hell, I even tried it for myself and was actually quite pleased (for a short while). Indeed, my TV time shifted significantly from digital TV to my fixed Netflix TV-show. I still however from time to time wanted to watch the news on the national television (VRT, for our Belgian readers). Then, I discovered the VRT NU app, which basically was offering everything I wanted from that specific broadcast. At any time I wanted. For free.
Yet, being a creature of habit, I still continued paying about 25 euros a month for digital TV. Because “you never know”. Because it seemed quite drastic to suddenly pull the plug on your favorite channels, not facing up to the fact that well, you haven’t recently watched any show on it. Then, as I was preparing to switch houses, I ultimately took the effort to compare prices between providers (the company that provided my digital TV also provides internet, as is common in Belgium). After realizing I pay an outrageous 70 euros for both my internet and digital TV, I pulled the plug. I have now switched to a 32 / month internet only subscription. I have not missed the digital TV for one second. The list of alternatives is huge. There is so much content available on streaming services that, to me at least, it makes no sense to want to combine different services. Pick one, and if you feel like that one is no longer serving your needs, make the switch to another one. The decision to cut digital TV and switch provider will save me 456 euros / year. That number truly did not represent the value I attributed to the service of having digital TV. Maybe for you it does but helping to express the cost of these subscription(s) on a yearly basis can really be quite confronting. Do the math from time to time and ask yourself if it’s still worth it.
Get in touch! Do you feel like we are spending too much on subscriptions? Let me know! This article is part of a series (The subscription curse). More will follow!
ING. (2018). Now that we subscribe to music, are tools and toiletries next? Opportunities and challenges for tangible goods subscriptions.