Subscription overload? Ways to manage services and payments

From shopping and entertainment to meal delivery and health and fitness apps, there's a subscription for just about everything. But do you know how many you’re signed up for and how much you’re spending on them every month?

According to recent data, the average Australian household spends $62 per month on digital media subscriptions.¹ But, here’s the catch: 64% are concerned about the cost of having multiple subscriptions, with many overspending average target monthly budgets.²

So, is it possible to better manage subscriptions? Read on for ways to evaluate and handle subscription services and payments.

What are subscription services?

A subscription is a business model where a company charges a recurring fee to access its products or services, which could be monthly, quarterly, or annually.

Here are some common examples of subscription services:

• Video, music, and entertainment streaming platforms
• Gaming services
• Meal plan delivery subscriptions
• Pet supplies subscription boxes
• Cloud storage services
• Beauty product subscriptions
• Book subscription services
• Online fitness classes and workout plans
• Software subscription services
• Food, drink, and gift subscriptions
• Magazine and media subscriptions
• Healthcare apps

How do subscription services work?

After a customer signs up for a subscription online or through a mobile app, they are typically charged automatically on a regular basis. Many subscription services also offer free trials, promotional periods, or tiered pricing options to attract new customers or retain existing ones.

Check out an overview of common subscription types and how they work:

• Standard subscription plans. This is one of the most common types of subscription services, where customers pay a recurring fee for access to a product or service for a set period, typically a month or a year.
• Pay-as-you-go plans. With this type of plan, customers pay for each individual use of a product or service. Examples include pay-per-view movies or games and prepaid mobile phone plans.
• "Freemium" and tiered plans. Freemium plans offer a basic version of the product or service for free, while premium features are available for a fee. Tiered plans offer different levels of access and features for different pricing levels.
• Free trials and promo periods. This type of subscription allows customers to try a product or service before committing to a subscription. Promotional periods may also be offered, when customers can access a product or service for free for a limited time. Often, these trials or promos will automatically continue into a full, paid subscription if not actively cancelled at the end of any promotional period.
• Usage-based plans. With this type of plan, customers only pay for the amount of product or service they use. Examples include mobile phone data plans or software usage plans.

Tips for managing subscription payments

Wondering how to manage recurring payments? Consider these best practices:

• Keep a list of subscriptions. Make a list of all existing subscriptions and the recurring payments to help track expenses and avoid unexpected charges. This can also be a useful thing to track via an expense tracker.
• Review subscriptions regularly. Review subscriptions every few months to ensure they are still providing value. Cancel any that are no longer being used or not needed.
• Set up alerts. Many subscription services allow subscribers to set up alerts for upcoming payments.
• Consider using a subscription management tool. These tools can help you find and cancel subscriptions that are no longer needed without having to log in to each separate platform.
• Be mindful of free trials. If you signed up for a free trial of a subscription, consider cancelling it before the trial period ends if the service is not needed. Otherwise, automatic charges for a full subscription may be applied.
• Use one payment method: Consider using a single payment method for all subscriptions for visibility of all payments in one place. For example, payment subscriptions can be managed from one place in the PayPal app.
• Disable auto-renewal. Make sure to view your account settings and deselect the auto-renew option. You should receive an alert about an expiring subscription instead of making an automatic payment.
• Review terms and conditions. Read the fine print before signing up for a subscription, so cancellation requirements are clear if the subscription is no longer needed or wanted.

Tips for auditing subscriptions

With so many options for subscription plans, it’s easy to forget which ones are being paid for — and even easier to forget the ones no longer in use. Auditing your subscriptions can help you ensure you’re not spending money on products and services you might not be using.

To audit your subscriptions, you could start by:

• Reviewing your bank and credit card statements. Go through your financial statements for the past year and highlight any subscription payments. This could help you to identify any subscriptions missing from an initial list.
• Evaluate each subscription. For each subscription, evaluate whether it’s still useful and valuable. Consider whether there are any similar services that offer the same features at a lower cost.
• Cancel unnecessary subscriptions. Cancel any subscriptions that are not being used or are unnecessary. If you’re unsure whether to cancel a subscription, consider whether you would sign up for it again if you didn't already have it.
• Check for unwanted paid apps. Beyond reviewing your financial statements, go to your smartphone’s settings and check for unwanted paid apps.
• Consider sharing the cost of subscriptions. If you live with roommates or family members, consider whether it’s possible to share the cost of a subscription to save money. For example, you could split the cost of a meal kit subscription.

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