Does it always seem that your money never goes as far as it should? One of the main culprits are the slow money leaks that we all have. These are generally recurring monthly expenses for a subscription or service that by itself appears quite small, but when you factor in dozens of these potential leaks it can drain hundreds of dollars from your budget each month. You know what I’m talking about. Cable bills, gym memberships, magazine subscriptions, or even regular dues to an organization. Each one may be just a small monthly payment but they add up faster than you realize.
A lot of people focus on the big things when trying to get spending under control, and that’s not a bad thing. For example, buying a used car instead of new is a single purchase that can immediately save you thousands. You should still be doing these things, but don’t neglect the little things. Plugging even the small money leaks can lead to significant savings.
Examine Your Memberships and Subscriptions
How often are you using that gym membership that you signed up for in January as part of your New Year’s resolution to get into shape? Memberships like these can actually be quite costly and if you aren’t getting the full use out of the service you are probably throwing money away.
Another good example are the video rental services such as Netflix or Blockbuster. How many movies do you actually receive per month versus what plan you are on? Do you really need to have 3 videos out at one time? If you watch even one or two movies per week you can likely get by on a lesser plan and that could save five bucks a month. Also consider suspending the service during the summer months. You’re more likely to be watching less TV, so if you can eliminate a $12/month fee for six months out of the year you’re saving over $70.
Paper Media Subscriptions
Another big drain comes from newspaper and magazine subscriptions. Personally, I love magazines so I subscribe to quite a few. Unfortunately I often find that some magazines will get buried under the mail and go unread for weeks. Clearly if a magazine is finding itself rarely read it can probably be canceled. You can find most magazines at the library or the bulk of the material can be found online. Examine your magazine subscriptions and see which ones you can live without.
Newspapers are an area that really add up since they can be quite expensive. We get a daily subscription but there are many days during the week when I’m busy that I’ll rarely get past the first section. Most of the reading comes during the weekend so changing the subscription from daily delivery to Sunday only alone could save over $10 a month. Make sure that with your newspaper and magazine subscriptions that you are really getting the most out of them, otherwise cancel or cut back on the services.
It is no surprise that television and internet services can be very costly. Some households can spend upwards of a few thousand dollars a year on tv and internet service. Take a good look at what your true needs are and find out what cuts can be made. Do you really need that $10-$15 a month premium movie channel? How about the super deluxe platinum package with 500 channels when you only watch a handful of channels?
Even if you find you do want some premium service you generally don’t have to subscribe to it year round. If you want the sports package to catch your favorite college football team do you really need to pay for that package from February through July? Or maybe you subscribe to HBO because you’re a diehard Entourage fan. Again, these types of series don’t generally run new episodes year round and you could save a lot of money by only signing up when you actually want to catch the shows. Again, take a $15/month premium channel and pay for it for only three months instead of the whole year. You just saved $135.
Finally, even if you feel you can’t make any cuts you can still save money with a quick phone call. As I generally do every six months or so I call my cable provider and inform them that I am shopping around considering switching to the dish or that XYZ provider can give me the same service for a lower price.. I can almost always find someone who will be willing to cut my cable rate or enroll me in a promotion for a few months which can easily add up to a hundred bucks or so in savings.
Add It All Up
Remember, the little things add up. Saving $5 here and there may not seem like much, but consider what some small savings amount to over time. Save $5 by changing your Netflix subscription, cancel that $20 a month gym membership you rarely use, reduce your cable bill by $20 and get rid of a few magazines you don’t have time to read and you may realize a monthly savings of $50 or so dollars.
What does $50 a month actually buy you? That could pay a utility bill, it could be an additional $600 going into your retirement account or work towards building your emergency fund. Another $600 a year applied to the principal of a high-interest credit card can also put a nice dent in that debt you’ve been trying to eliminate. Whatever the case may be for you, use that as motivation to cut back on these financial leaks that can slowly drain your bank account.
Author: Jeremy Vohwinkle
My name is Jeremy Vohwinkle, and I’ve spent a number of years working in the finance industry providing financial advice to regular investors and those participating in employer-sponsored retirement plans.
With automatic electronic payment, I find it really easy to lose money through subscription leaks. Never really see the money, or the bill.
Your article pushed me to think seriously on these money-leaking factors. Actually, you are right we never consider paying little bit here and there on subscriptions but in totally it turn out in a big amount. I would stop my magazine subscription as i could get it all on internet only.
Thanks for sharing great tips on how anyone can stop many of the seemingly insignificant leaks that drain one's money over time. It's funny how much money you can really save when you start taking these "money leaks" seriously. You are right that one should focus on the big tickets as well as on the small ones.
Wow! I never realized how much it all costs after adding everything up! Mine was more than $100 that I could be saving.
As my favorite shows are available online (fox.com, cbs.com), I don't see a reason to pay $50+/month for cable.
One thing that really helped me is placing all my recurring expenses (rent, electricity, cell phone, car, insurance...) on a piece of paper and understanding how much they cost me total. I'm sure that you will plug the leaks as soon as you do that.
keep it up this nice sharing with have a great info that how to Plug Your Money Leaks and Save Hundreds of Dollars Painlessly
A few added benefits to closely scrutinizing these types of things is that in the case of things that you need (i.e. insurance) then it is amazing how much you really can save if you consistently shop around every 6 months or so because of the way that people insurance needs change over time and also the rates themselves change amongst multiple companies. Also, in the case of things that you just want(i.e. cable TV) many times if you attempt to cancel/suspend your service then the customer service rep will try to incentive you to stay by sweetening the deal and giving you a lower price so that even if you decide to keep the service then either way you just saved yourself some money.
When one starts scrutinising the old credit card bill, and all the pesky rebill offers that just will not go away it rapidly becomes apparent that there are loads of little holes that can be plugged to stifle the outflow of little amounts of cash that add up to lots when you add them all up and look at their accumulated value over a one year period!
Buying new cars is also really silly, and remeber to shop around for insurance, as the policy conveniently that came with your new wheels is usually way overpriced. Get a decent insurance broker and be prepared for a huge shock!
I would like to add to your list utilizing free online offers; and I'm not talking about samples and coupons here, but cash. I’ve tried a few and this one is real good - $1000 cash. http://www.mediancs.com/rd_p?p=192462&t=9534&a=25081-scash&gift=25081 Amazing!
I consider paper media subscriptions redundant nowadays because the internet pretty much has all the major information we need. My Well Of wealth
This is a timely post for me. After years of having cable I finally decided to get rid of it and try an alternative. I cancelled the cable. I bought a digital converter box for $60, an antenna for $80 and I'm waiting on the Roku Netflix player that I ordered for $100. I was paying $100 a month for cable and just finally realized it all wasnt worth it. This setup will pay for itself in about three months. Then I will just have the $15 monthly Netflix subscription. And of course my Dsl internet. Both of which I had already.
I actually feel liberated and very excited about it. If you've been on the fence to cut your monthly cable or satellite subscription, I highly recommend trying this option.
Subscriptions are a great way to cut costs if you don't use them or if they are online. A lot of magazines have just as much if not more information online now. But if you use subscriptions and it's worth the money, no need to cut them. For example I get all my money's worth out of my gym membership and Netflix subscription. For me the benefits outweigh the expenses.