Micro-subscriptions are small, recurring payments that you make for online services, such as streaming apps, news websites, cloud storage and more. They're often marketed as a way to save money, but they can actually drain your bank account if you're not careful.
How micro-subscriptions work
Micro-subscriptions typically cost a few dollars per month, but they can add up quickly if you have several of them. If you subscribe to Netflix, Hulu, Disney+, and Spotify, you're already paying about $50 per month. Add in a few more subscriptions for cloud storage, Xbox Live, and a fitness app, and you could easily be spending over $100 per month on micro-subscriptions. That’s $1200/year, which is almost 2% of the average person’s income!
Why micro-subscriptions can be dangerous
One of the dangers of micro-subscriptions is that they're easy to forget about. You might sign up for a free trial of a service and forget to cancel it before the trial ends.
It's easy to add new subscriptions, especially when they're so cheap. Before you know it, you could be spending a significant amount of money on subscriptions that you don't need or use.
Tips to avoid being drained by micro-subscriptions:
- Track your spending. This will help you see where your money is going and identify any unnecessary subscriptions.
- Cancel unused subscriptions. If you're not using a subscription, cancel it. This seems obvious, but many people forget.
- Set a budget. How much are you willing to spend on micro-subscriptions each month?
- Be careful with free trials. When you sign up for a free trial, set a reminder to cancel the subscription before the trial ends.
- Be wary of impulse purchases. Think about whether you really need the service and whether you'll use it regularly.
- Read the fine print. Understand how much the subscription costs, how it works, and how to cancel it.
- Talk to your family. Ensure that everyone is aware of the subscriptions and that you're not duplicating subscriptions.
By following these tips, you can avoid being drained by micro-subscriptions and save money in your monthly budget.
To learn more about this and other financial strategies or events, visit www.jghfs.com/events or contact:
Hendricks Wealth & Estate Management
650 Spring Hill Ring Rd., Ste. 2000
West Dundee, IL 60118