How do you compare to the average American?
According to a survey from August 2021, Americans spend an average of $273 a month on subscription services. That’s a 15% increase in 3 years. But the worst part about this is that consumers are less aware of what they are spending money on.
I was quite shocked when I read this, as my monthly subscription payments only come to around $38. The average American spends 7X per month more than I do. My top 5 are shown in the post below.
I don’t think of myself as particularly frugal either. Whatever I need I buy. I don’t feel like I go without anything. But I live a simple life, so maybe I have few needs than the average person.
There are a few obvious places where I save money though. I don’t spend anything on wifi, a fitness center or a swimming pool. Or are included for free in the condo I’m currently staying at.
Most condos I stay in tend to have these three things included in the price.
If there’s no fitness center, I can easily do bodyweight exercises at home. I also love to walk and have always stayed pretty fit without needing to pay for any fitness facilities.
There are some things I’d pay for if there were more reasonable subscription or payment options. There are a few newspapers I wouldn’t mind subscribing to, but I don’t read any one of them enough to justify the cost. I find that subscription services like this are an all-or-nothing option. They are designed for people that want full access. It’s rare to have an option for occasional users.
Apart from the money people are spending per month, the other very interesting aspect of the survey is that people just weren’t aware of how much they were actually spending per month.
I guess that many take out subscriptions that they just forget about. They still pay but never use those services.
When the survey participants were asked to estimate how much they spend on monthly subscription services, the average guess was $62 per month.
People think they’re paying $62 but are paying over 4 times that amount. That is a huge overspend. These people were given a second guess. This time they guessed $96. That’s still almost 3 times less than they spent.
This leads to the obvious conclusion that most people appear to just spend money without giving it much thought. It seems like they rarely check their bank statements, otherwise, they’d easily spot unused subscription payments.
With the current economic crisis picking up speed, maybe now is a good time to check if you have any subscriptions that you no longer need. Maybe you can save $100 or more. Every little bit saved can add up to quite a substantial amount over time.
You can read about the coming economic crisis below. It also includes 5 actionable steps you can take to prepare yourself.
Here’s something for you to try. Guess how much you spend on subscription services and then go and check to see how much you actually spend. Let me know how accurate your guess was.