Opinion
Sign me up: How to save cash on your ever-growing subscription list
Dominic Powell
Money EditorReal Money, a free weekly newsletter giving expert tips on how to save, invest and make the most of your money, is sent every Sunday. You’re reading an excerpt − sign up to get the whole newsletter in your inbox.
When I was younger, I was obsessed with the idea of getting mail, to the point where I went out of my way to indiscriminately sign up online for every free magazine and newsletter I could find, resulting in (an ecstatic) 14-year-old me receiving stacks of letters every month.
However, unbeknownst to me, one of the subscriptions I’d signed up for – I believe it was Reader’s Digest – promptly started demanding monthly payments from my fairly miffed parents. I think after a lengthy phone call we got away with paying for just one issue, and I was immediately banned from signing up for any more mail (fair enough really).
Your list of subscriptions might be growing, but there are a few simple tips to keep costs down.Credit: Aresna Villanueva
More than 15 years later, my unintended Reader’s Digest subscription is still a relevant cautionary tale, especially given the rise in subscriptions across all facets of our lives. Many of us have signed up for one or more streaming services, gyms, e-commerce platforms, food delivery services or news sites – the latter being essential!
What’s the problem?
However, after a golden decade or so when fierce competition between companies kept prices low, the cost of our subscriptions is slowly creeping upward. In 2021, Netflix increased the monthly charge for its video streaming service, and earlier this year added insult to injury by cracking down on password sharing between users. Similarly, Amazon’s Prime delivery service increased its price 40 per cent this month, and many other services, such as gyms, have raised their prices as costs for everything from electricity to labour have increased.
Streaming services tend to be one of the first things people cut down on when other parts of their lives get more expensive. A recent survey from comparison website Compare the Market found one in five Australians are cutting back on in-house entertainment in the face of rising interest rates and inflation, reporting that, on average, we’re paying $30 a month for two different streaming subscriptions.
What you can do about it
It’s easy for your subscriptions to pile up and leave you shelling out each month for things you don’t really use, so here are some tips to cut your costs:
- Get across it: Before you can decide what makes the cut or not, you need to know what you’re actually paying for each month. Download last month’s bank statement and comb through it (printing it out helps) to confirm your direct debits – it might even uncover some things you didn’t even realise you were paying for. On that note, check if your bank offers a more “modern” banking app that has the option to notify you about each transaction. That way you’ll never miss when you get charged for a sneaky subscription.
- Go annual: While most of us are accustomed to paying our subscriptions monthly, Alex Choros, managing editor at comparison site WhistleOut, says you can make significant savings by switching to annual payments. For something such as Prime, a yearly subscription costs $79, whereas monthly is $9.99 – a saving of $40. However, not all services offer annual pricing, so check it out before you switch.
- Cop some ads: When it comes to streaming subscriptions, many services now offer price tiers with ads or lower quality, which can be significantly cheaper if you’re willing to have a real free-to-air TV experience. “You’re going to pay more for the ability to stream in higher definition and binge shows across multiple screens, but cheaper options are available if you’re willing to limit the number of compatible devices and quality of your streaming,” says Compare the Market’s Chris Ford. For example, Binge’s ad-supported service is $10 a month, compared to $16 without, and Netflix’s is $7, compared to $11 without.
- Bundle up: Telcos, internet providers and energy retailers often bundle subscriptions as part of package deals, Choros says, with both Optus and Telstra offering a certain number of months free on services such as Spotify, Netflix and others. It’s important to read the fine print, he says, as some offers are only valid for new users.
- Enjoy a freebie: Take advantage of “one month free” offers to binge all the content you want to see on a particular streaming service, and set a calendar reminder so you don’t forget to cancel before they start charging.
- One in, one out: If you find yourself accruing subscriptions unnecessarily, it could be time to implement a one-in, one-out policy, where you don’t sign up for anything new without cancelling an existing one you might not use that much. This will mean your costs won’t balloon outwards, and it’ll force you to be mindful about what you’re signing up for.
Advice given in this article is general in nature and is not intended to influence readers’ decisions about investing or financial products. They should always seek their own professional advice that takes into account their own personal circumstances before making any financial decisions.