These days, everything is subscription based, as to try to keep customers paying for a product or service as long as possible. It’s a great business model and something that I would try to implement myself if I was trying to sell something. However, for the consumer, subscriptions can be a terrible, terrible thing.
Think about all the things in your life that are subscription based. Some of them necessities like water, gas, electricity, and trash service. Then, we have the luxuries, which unfortunately, a lot of people consider necessities. These include telephone and cell phone service, cable or satellite television, magazines, newspapers, and internet. The list goes on and on.
Those luxuries are killing your paycheck. They add up quickly and unless you take action, they’re not going to go away.
My Netflix Subscription
Don’t get me wrong, it’s completely fine to have a lot of those luxuries. Myself, I have never had cable or satellite television service my entire life (and I probably never will). I think I spend more than enough money for internet service and I can watch everything I need using Netflix. The thing is, I’ve been so busy lately that I haven’t really been using the service very much. Besides the Instant Watch plan, I also had a subscription to the two disc at a time (unlimited) plan.
During the past several months, I started to notice that I was holding onto rental discs for weeks at a time, never having enough time to sit down and watch a movie. I decided that it was a good time to review my use of Netflix, and since I wanted to keep the service, see if there were any other plans that were more appropriate for me.
I logged into my account and looked at the DVD plans. Since I average about two movies a month, I found that the best plan would be the Limited Plan. The plan allows for one disc out at a time, with a limit of two rentals per month. Perfect.
How Much I Saved
I changed my plan toward the end of the month and the changes took effect at the beginning of the next. My monthly bill with Netflix on an Instant Watch and two-disc unlimited plan used to cost me $24.18 per month. Not much, and a much cheaper alternative to cable or satellite. However, taking my usage into consideration and changing my plan to an Instant Watch and one-disc (two rentals per month) at a time plan is now only costing me $14.46 per month.
Yeah, it’s only a difference of $9.72 per month, or $116.64 per year. But you’re looking at it all wrong. This is money and finance we’re talking about, so you need to compare the change using percentages. By changing my plan I am saving 40.20% per month. That’s a significant savings.
What You Should Do
- Review the Netflix subscription plan you have.
- Realistically assess how you use the service in the present.
- Don’t consider what-if questions. You can easily upgrade later if your usage increases.
- Select a new plan.
- Log into your account and review the current plan options.
- Choose a better fitting service plan or cancel a plan as appropriate.
- Review your payment method.
- Make sure you are using a secure password.
- You had better be paying your Netflix bill with a rewards credit card!
- Calculate how much you will save.
- Figure out how much you will be saving each month, and year, in dollars.
- Calculate how much your savings will be in percent.
- Do something awesome with the money.
- Use the extra money to pay off debt.
- Or, invest the extra money.