Money tips

Subscriptions: avoiding the snowball effect

Subscriptions costs add up. It's important to stay subscription savvy - making sure you're only paying for what you use and getting the most out of it. 

The cost of convenience

With many of us living busy and fast-paced lives, it’s no surprise that companies usually advertise subscription services on the basis of convenience. 

Paying smaller amounts regularly can seem more convenient and affordable than a bigger upfront cost. However, choosing convenience usually comes with a cost.

Most subscriptions automatically renew every month, making it easy to forget that you’re paying for it if you don’t review your statements regularly. Service providers know that many people will continue paying even after the service is no longer useful or important to them.

Subscription creep

Each little cost adds up, often without you realising how much of your money is going towards these services - often called “subscription creep”. Each service on its own doesn’t seem like much, but together they can have a really significant impact. For example, six subscriptions costing $20 each could cost $120 per month, more than $1,400 over a year.

Living well on every level

What do you really need to be happy? Most people think they need more money and advertisers tell everyone they need more stuff. But Australian research into wellbeing found these three indicators are the most important - “the golden triangle of happiness” (Australian Unity, 2015)

1. Strong personal relationships. This is having someone in your life who you can trust and who remind you that you are loved and valued. These people are your support network and provide a sense of connectedness.
2. Sense of purpose. You will be happier when you are actively participating in things that give you a sense of purpose or responsibility. This might be in your job, your studies, hobbies and social groups or volunteering - things that bring your life meaning.
3. Financial control. While the research shows that wellbeing rises with income to a point, it is actually the sense of control over your finances that is the most powerful factor. That's why our book is titled You’re the Boss - because we know that getting on top - and feeling on top - of your money is one of the key points to living well.

Money by itself doesn't lead to wellbeing - it's using money as a tool to get the goods, services and experiences we need to create a happy environment.