Subscription Creep: The Monthly Costs that drain your Wallet

Table of Contents:

• Introduction – The Invisible Money Leak

• What is Subscription Creep?

• Financial impacts of Subscription creep

• Why do we always tend to ignore subscription creep?

• How to deal with such traps?

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Introduction

Ever checked your bank statement and thought, “Wait, when did I subscribe to this?” If you ever thought like this then you are not alone, there are many people who love to binge watch from the comfort of their home, to binge watch we need to buy certain apps such as Netflix, Prime Video, Jio Hotstar, etc. To get these apps we need to apply for them for a fixed period of time this application is called a subscription. These subscriptions range from the smallest of the amounts to thousands at max. At an average a person in India spends 500 rupees a month on these platforms, this estimates in a whopping thirteen thousand rupees spent just on television-based entertainment in a span of 365 days. If we save even half of this amount for 20 years, we would save rupees 1,30,000. But, most of us never notice this drain of money from our wallet and as time passes, we start getting addicted to these platforms which causes us to make holes in our wallet.

What is Subscription Creep?

Subscription creep is when small, recurring monthly costs quietly add up, draining your wallet without you realizing it. Many people sign up for streaming services, fitness apps, cloud storage, and premium memberships, thinking each one is affordable. But over time, these subscriptions stack up, leading to hundreds or even thousands spent annually. It is important to note that binging and entertainment are necessary for a healthy lifestyle but if done in an unnecessary amount without paying attention to financial affects is what Subscription Creep is all about.

Financial Impacts of Subscription Creep

Spending your money without knowing where you are spending it does have consequences, which are as follows:

• Hidden Expenses – For a common man it is important to save money for his future so we save our money where ever possible but when we see that we are getting an option to see unlimited movies for an entire month we forget to do the math:

If we assume monthly cost to be an average, rupees 500 for each platform and we have 10 platforms then the following is what can happen:

The total amount spent in an annum will be rupees 60,000

If this money is invested in a mutual fund with an 8% annual return, here’s how much you’d have over time:

1. 5 years → ₹3,67,000

2. 10 years → ₹9,32,000

3. 20 years → ₹28,98,000

That’s nearly ₹29 lakh lost to unnecessary subscriptions over two decades!

• Underutilization – A study conducted by Stanford Economists found that most people forget to cancel their subscription which leads the company to get a boost which ranges from 14% to 200% in terms of revenue. 90% of the subscribers often underestimate their spending and ending up paying 3 times the amount estimated due to continuous ignorance. This often results into customers being unable to make budgets due to the unknown cost of the subscription fee.

Why do we always tend to ignore subscription fee?

• Phycological Factors – since when we first see the subscription screen we just think “ah! Its just a small amount for a lot of entertainment” but we fail to notice its compounding effect. Due to the immersive content and ai driven algorithms we fail to notice our addiction towards such content which leads to subscription pileups and most of us also choose the option of auto-renewal which gives us uninterrupted entertainment but also quietly drains our wallet.

• FOMO – Due to the “fear of missing out” people tend to also keep apps they don’t even use additionally since it is not necessary that a particular series or movie may come on the same app as the customer has this leads to the customer buying subscription of 3 months just to watch a single web series which it takes only one dedicated Saturday to finish.

How to deal with such traps?

• Audit your Subscriptions – if you keep a record of your entertainment, you can easily detect the hole in your wallet. This will help you to notice any unnecessary costs which you are paying in subscription renewals.

• Necessity – We download several platforms and pay for the subscriptions required in these apps for just one show and then we rarely use them. This causes unnecessary wastage of money.

• Set reminders – The advantage of setting reminders is that we are able to notice any subscription which we don’t use anymore, this can help in cancelling subscriptions to save money.

• Subscription Management Tools -You can use apps like Truebill and Rocket Money to keep a track and manage your subscriptions.

• opt for Annual Billing – If you plan to keep a subscription, paying annually often comes with discounts.

Subscription Type Monthly Cost ($) Annual Cost ($)

Streaming Services (Netflix, Disney+) 20, 240

Music Services (Spotify, Apple Music) 10, 120

Cloud Storage (Google Drive, iCloud) 5, 60

Gaming Services (Xbox Game Pass, PS Plus) 15, 180

News Subscriptions (NYT, WSJ) 12, 144

Software (Adobe, Microsoft 365) 30, 360

Fitness Apps 12, 144

Miscellaneous (Patreon, Extra Services) 10, 120

Above is a chart you can use to calculate you subscriptions.

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