Last week an interesting news article was published. It showed that on average people have 11 subscriptions. Much more than I expected. Youngsters under 25 years old have on average 16(!) subscriptions. Imagine the impact of the costs of that many subscriptions on reaching financial freedom?! The Dutch Consumers Association (Nibud) advised making a list of your subscriptions every year and decide whether you really need them. That’s exactly what I will do right now!
The benefits and risks of subscriptions
Subscriptions are easy and often give you access to great products and services. Another benefit is that the monthly costs look affordable. But according to the article 30% of people hold on to the subscription longer than they intended. Costing you a lot of money along the way.
Subscriptions and services are here to stay. It’s not about owning things but using the things you need. Uber is a nice example of ride sharing that gives you all the benefits and flexibility to go wherever you want without the taxes and up keeping costs of a vehicle.
The same with Netflix, Amazon Prime, Spotify, Apple Music, YouTube, mobile phone providers, food deliveries, sock deliveries (yes, socks), etc. These are all great services but do we really need all of them?
With all these tech companies producing great services and products, it makes sense that people until 25 have the most subscriptions. But 16? Really? No wonder more and more young adults turn to debt to finance their lifestyle. Long-term the impact could be disastrous.
Let’s take inventory of my own subscriptions
I counted everything that has a monthly payment for a service or product as a subscription and I included the subscriptions of my wife as well. Additionally, I also included my assessment why I have this subscription and whether I still need it.
As you can see, I’ve included a much broader definition of subscriptions than the one that the writer of the article used. For example, electricity, water, heating and health insurance was not included in the research conducted by the Dutch Consumers Assocation (Nibud).
If I apply a similar definition of subscriptions as Nibud, I have about 6 subscriptions. Which is far below the average of 11. And much lower than 16 which people under 25 have.
What can you do?
I think for you the best start is to create a similar list as I did. When I was piling up this list I was surprised by how fast the list gets longer and longer. I think you will be surprised as well!
Afterwards, decide whether you really need that subscription. Does it make you happy or make your life significantly easier? Or can you easily do without? If you’re in doubt, just cancel it because you probably won’t miss it, anyway.
And expenses is one thing, but how about the time that specific subscription consumes? A good example is Netflix. I canceled Netflix last summer just to spend more time on useful things (yes, the cliché of reading a book) and have more quality time with my wife and kids.
I was hesitant to cancel Netflix because I didn’t want to lose my profiles and viewing history. But don’t worry! Netflix saves your history and profiles for 10 months. If you cancel and renew within 10 months, everything is back to what it was before you canceled! You can also opt to stay updated about news shows and movies based on your interests. So, no reason to feel you’re missing out!