We're turning our focus on saving money, and every week we're going to tackle a new way to save on things you’re already spending money on.
By taking action and doing some of the stuff we’re talking about here in this series, you can build your first emergency fund and pay down tons of debt.
Subscriptions and monthly subscription pricing is all the rage right now. TV, software, clubs, product boxes, clothing, pet supplies, leadership tools, entrepreneur boxes, weight loss, healthy eating, and the list goes on and on!
Subscription-based pricing is fantastic in many ways because you can get great services for an affordable price. Even our online membership, Roots of Personal Finance is a subscription-based service. It’s built to make financial coaching and accountability affordable for anyone, and it’s helping our members save and pay off MILLIONS of dollars for an incredibly low investment.
But I also see subscription-based services punching a lot of holes in people’s bank accounts. In a past blog post, I talked about having a leaky bucket, and a leaky bucket can drain your bank account and keep you from being able to save and pay off debt. That’s not a good plan.
The saying, “It’s only…” will eat up your income in no time. When it comes to low-cost subscriptions and products, it’s easy to overlook the cost. But now multiply that by 5, 10, or 15 of these subscriptions, and now you have a pretty hefty amount of your income going out every month towards these low-cost products.
Lots of things are nice to have, but are they a necessity of daily living? In most cases, they are not. Remember, we are looking for ways as we can to save money to build an emergency fund and pay down our debt. Most of these subscriptions aren’t helping you achieve that goal. They’re keeping you from it. By all means, keep the ones that bring great value to you, but ditch the ones that are just nice.
Most people tend to forget that for every dollar you decide to spend, you’re also making another decision not to spend it somewhere else. This is called opportunity cost. This is a tip that will help you with all of your future purchases, not just on subscriptions.
When making purchases or signing up for your next subscription service, stop and think what this purchase will prevent you from doing in the future. For many of us, we want to have money in a savings account. We want to stop living paycheck-to-paycheck. We want to pay off debts. Spending money is pushing you further away from these goals.
So ask yourself, is this purchase worth more than my savings account? Is it worth the hours I will have to work to earn this purchase? Is it worth it to be in debt longer? Changing your mindset and thinking differently will save you tons of money moving forward.
With just a few simple changes and spending a little time, you can save yourself tons of money, freeing up cash to save your first emergency fund and pay down your debts! Go ahead and get started and I can't wait to hear how much you save!
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