The Neverending Battle of Leaking Money

These days it seems like everything costs “Just $10 a month”. You can have a subscription to just about anything these days. While $10 a month doesn’t seem like much, over time it really adds up. When you add up all the little costs each month and then multiply that times 12, it can be significant.

I don’t think a lot of people realize how much they bleed each month. Sure, the services that they are receiving are giving them a reward, but sometimes I think things end up on autopilot and you forget you are even using the product or service that you are paying monthly for.

Here are a few of our “little monthly costs”

Tivo: $6.95 a month
Netflix: $8.99 a month
Milk delivery: $20.00 a month (double the price of store bought so $10 premium)
Health club: $10 a month (have had this forever so I have a low rate)

Individually none of them are significant. Add them up and all of a sudden I can see where over $400 a year goes. I think our house is somewhat unusual in that we don’t have a lot of small expenses like this because we watch it so closely.

A typical household might have:

Tivo/DVR: $12 (regular rate)
Netflix/Blockbuster: $16.99 (3 movies at a time)
Health club: $40 a month (fairly typical)
Cel phone texting: $20 per month (family plan)
Cel phone data plan: $30 per month
Lawn service: $60 per month
Cleaning service: $150 a month
Caller ID: $6.50
Call Waiting: $5

I’m sure there are a ton more services that people subscribe to on a monthly basis. Most of these are convenience type expenses that make life just a little bit better. In the example above, which I don’t think is a-typical, a family would be shelling out nearly $4000 a year in what I would term convenience fees. It’s obviously up for debate what is really a convenience and what is “needed” but that’s a very personal decision. What’s even more interesting to me is that pretty much every expense I list above didn’t even exist 100 years ago. That means a typical household today is spending upwards of $4000 on things that no one ever even had the option to buy 100 years ago. That tells me that it’s much more in the “want” department than the “need” department.

I guess the reason that I’m thinking so much about these kinds of convenience fees is because I made the decision to buy an Iphone awhile back. I haven’t bought it yet because I have been waiting for the new Iphone 3G S to come out. That happens next Friday. I’m still planning on buying it but I do find myself dreading signing up for another monthly cost that really isn’t a necessity. I will be increasing my cellular phone bill by around $30 a month, or $360 a year. My hope is that once I have the Iphone for awhile, it will feel like the best money I’ve ever spent. If it doesn’t, I’ll be paying the penalty for two years………..