By Alexis Brock
“I remember when I was a little kid, just about every month I got a Sports Illustrated Kids magazine,” Jaleel Laguins said. “I’d bug my mom about it every time she checked the mailbox.”
Lots has changed in Laguins’ life since the early 2000s, but his fascination with receiving a monthly subscription ‘gift’ that adds entertainment value to his everyday life is not one of them.
Now some of those ‘gifts’ arrive in his digital mailbox as opposed to his physical one, but that hasn’t stopped him from making room for them in his strict college student budget.
He isn’t alone. Vindicia is an Amdocs company that aids businesses in developing their own subscription business models. Recently, the company commissioned a study that revealed 70% of American households subscribe to at least one streaming service.
Additionally, the same study found that the average American viewer subscribes to around three streaming services and pays an estimated $8.53 per service. In 2019, the Consumer Technology Association projected that revenue from video and music streaming services would exceed $25 billion.
That estimate doesn’t include revenue from other subscription services that offer health, fitness, beauty, and gaming services. For Laguins, it wasn’t hard to get overwhelmed by all the options in the subscription economy.
“I remember one time, I had subscribed to like three free trials, and then forgot about them after the trial ended,” he said. “I wasn’t even using them,” he continued, “so when I woke up to check my bank account and a lot of money [was gone] I was so mad at myself.”
App developers have taken advantage of this problem and engineered their way into the subscription economy. Applications like Truebill and Trim help consumers manage their subscriptions. Ironically, each of these personal budgeting services also offers plans that include monthly fees. In some cases, a consumer may need a subscription service to manage their subscription services.
Periods of economic downturn, like the one we’re experiencing right now, often force consumers to take a hard look at their monthly expenses and cut back on the unnecessary. That was the case for Laguins.
“I realized I was spending more than $100 a month on subscription services,” Laguins said, “and after the pandemic hit, I wasn’t able to work my on-campus job. That was just too much money to spend.”
Eboney Byrne, a certified financial educator who teaches money management and debt mitigation, said college students should prioritize their subscriptions. After determining which subscriptions should stay and which should go, students should build them into their budgets, she said.
“Since it is something that is becoming more important in our daily lives and budgets, it is something that college students will have to prioritize,” Byrne said. “That way they can make sure that what they’re doing aligns with what they want.”
Byrne said that the best way to align your budget is to break down the annual cost by month. Laguins tackled his subscription spending through a similar approach.
“On my phone, you can see what subscriptions are tied to your account, and I just started asking myself which ones really mattered to me,” he said. “Some, like for my music, I knew I couldn’t live without, but others weren’t worth the $8 or $9 a month that they were costing me.”
Alexis Brock is studying journalism at the University of Georgia. She is a 2020 Cox-SABEW Fellow, a training program in partnership with UGA’s Cox Institute for Journalism Innovation, Management & Leadership.