An Easy 5-Step Guide to Auditing Your Subscriptions, According to Experts
In the early aughts, there were just a few subscription services to keep track of: Netflix (who could forget the red paper DVD envelopes that arrived in the mail?) and other pioneers like beauty boxes and meal kits. But now subscription services have filled every imaginable niche. There’s BritBox for British TV lovers and Horti for plant enthusiasts, and Taco Bell is even test-running a taco subscription. You can have designer clothes, toilet paper, and toys for your pets all delivered straight to your doorstep.
There’s much to love about these services, but with amassing subscriptions and memberships comes a lot of automatic recurring charges, some oh which you may be overlooking.
On average, people pay $237.33 a month for their subscriptions, according to consumer research, which is nearly 200 percent more than they estimate spending when they’re asked on the spot — and I can relate. Recently, I reviewed my own bank statements, and I discovered that amid the pandemic I accidentally signed up for the same fitness streaming service twice — once from the web and once from my phone — and had been paying double for several months.
“When you don’t have to manually pay for a service and it’s set on auto-pilot, it’s easy to overlook the charge and forget what you’re paying,” says money savings expert Andrea Woroch. “However, giving your subscriptions an audit every few months can help stop wasteful spending especially when you give each one some thought.”
If your own subscriptions are due for a thorough review, here are five smart steps you can take to audit them.
Step 1: Make a list of all your subscriptions.
A 2021 survey from Chase found that two-thirds of customers forgot about at least one recurring payment they’ve signed up for in the last year. So, the first task is to figure out all of the subscriptions you’re paying for and pinpoint any that are flying under the radar.
First, Woroch suggests finding and writing out all your subscriptions along with how much each costs on a sheet of paper or in an Excel chart. “You may even come across a couple smaller subscriptions you forgot about like that photo editing app or perhaps your cancellation request never went through,” she says. “Or, you may be paying more than what you originally signed up for.”
Now, the searching process. When you’re reviewing your bank information to see what’s being charged, remember to go back further than a month so you get a full snapshot because some services renew quarterly or annually.
If you’ve subscribed to something through the Google Play Store or App Store, you’ll be using the payment method you’ve registered with Google or Apple to pay for those services. You can check from your phone to see what services or apps you’re subscribed to, how much you’re paying, and your next billing date. On your iPhone, you can access this information by going to settings, tapping your Apple ID on top, and viewing subscriptions. Android users can do the same in Google Play; click your profile icon in the app, select payments and subscriptions, and open the subscriptions tab.
There are apps that can help you track and manage your subscriptions. Truebill, for instance, is free, but it has premium paid upgrades like a “cancellation concierge” and a bill negotiator. Or, you can check with your bank or credit card company to see if they offer free services. Capital One cardholders, for instance, have access to Eno, which notifies users of duplicate transactions or increases in subscription fees.
Using one payment method for all recurring payments because it will make it easier to review all subscriptions at once and catch unexpected subscription costs, says Dr. Bob Castandeda, program director in Walden University’s College of Management and Technology and a CPA with 40 years of experience in finance. “Several subscriptions have a one-time discounted introductory price with higher monthly fees, without a reminder or advanced notice,” he says.
Step 2: Determine how much you’re using your subscriptions.
Once you have all your existing subscription costs written out, create an honest list of how often you use each service every month and determine if it’s worth keeping. Is Hulu a nightly guest in your living room, and did you only sign up for HBO Max to watch “The White Lotus” (which you already binged)?
To figure out if a subscription should be there to stay, Woroch recommends asking yourself three questions:
- What value does it add to your life?
- Are you using the service and how often?
- Do you subscribe to or pay for another similar service? For instance, it’s nice to watch that one show on Showtime Now, but you could probably find plenty to watch between your Netflix and Hulu or Prime Video subscriptions. Perhaps it’s worth subscribing to just one at a time since.
Laura Lonie, a CPA and financial coach, also suggests asking: “Does this service save me time and money in the long run?” There may be duplicate subscription services in the same household that could be shared, and it’s easy to forget about sales tax on subscription services, which can be as high as 15 to 20 percent. (ICYMI: A couple years back, more states started imposing sales tax on intangible goods like streaming services.)
You can also look for ways to save on your subscriptions. For example, some plans with T-Mobile include Netflix (check your phone service provider to make sure you’re not missing out on any of these deals). Or, if you’re separately paying for Hulu and Disney+, opt in for the Disney bundle that also includes ESPN+. And if you use Xfinity Internet, you get Peacock Premium for free.
Additionally, Woroch suggests running a quick online search to see if there are any deals to save on a subscription. (She got Hulu for $1 per month for a year during a Black Friday sale). She also suggests looking for coupons before signing up, too, at coupon sites like CouponFollow.com that organizes deals by company name so it’s easy to see if there are any current deals on meal delivery kits.
If you decide the subscription service is valuable to you, check to see if you can pay annually rather than monthly to reduce the cost, Lonie suggests.
Step 3: Cancel the subscriptions that no longer spark joy.
Give the Marie Kondo treatment to your subscriptions and cancel any that are no longer being used or sparking joy.
To start, consider getting rid of subscriptions where there’s overlap, Woroch suggests. For example, you might have a gym membership and pay for a streaming fitness video provider. “Ask your gym if they offer digital workouts that you can access from home or check YouTube for free fitness videos.”
As you start cancelling services, be sure to ask for a ticket, confirmation number, or the name of the service agent when canceling a service, Castaneda says. Check your proceeding bank statement to make sure the service fees don’t recur.
You can even take it a step further after cancelling the expense by checking to see if you are entitled to any reimbursement of fees incurred,” says Brittney Castro, a certified financial planner with personal finance app Mint, which has automatic subscription tracking that will alert you when there’s a change in price.
Step 4: Start a subscriptions spreadsheet.
Now that you’ve streamlined your services, start a spreadsheet where you can keep track of your subscriptions moving forward. Consider columns that include the renewal date, the total cost, and how much you’re using the subscription. Be sure to add any other services you subscribe to so you can get an accurate picture of how much you’re spending.
As you’re doing this, Castaneda recommends including the necessary contact information for the service so you can easily cancel it at any time (or after the free trial expires).
Step 5: Reallocate your funds.
After you trim down on subscriptions, you may find that you’re saving hundreds throughout the year. It’s time to reallocate those funds. Since you’re accustomed to that cash being pulled out of your account every month, you could redirect the money into savings by setting up automatic transfers or using a savings app like Acorns or Digit.
Or, you could use the money to pay down your credit cards. Woroch points out that if you had been charging subscriptions on your credit card but charging more than you can afford to pay off in full each month, you were paying interest on those services.
If you find yourself wanting to put your funds toward trying a new subscription, time it so you can ask for it as a gift for the holidays, your birthday, or any other celebratory occasion. It’s a great way to trial a subscription to see if it’s something you’ll actually use without spending a dime that you worked so hard to save.
Bonus step: Make calendar reminders to cancel free trials.
Many subscriptions have free trials or offer low introductory rates. “As soon as you sign up for a free trial, put the date you want to cancel on your calendar, so you remember to cancel,” Lonie says.
Also, make sure you understand the policy for canceling the free trial. Can you cancel online, or do you have to call? Regardless, be ready for the sales pitch about why you should stay and expect some lower rates to be offered to keep you as an active subscriber.
Did we miss any good subscription auditing tips? Let us know in the comments below!