Recurring monthly costs: Which are worth it? Which are not?
I met some friends at a local restaurant Monday night. While chatting, we found ourselves bopping to the music playing on the radio. For more than hour, great song followed great song: U2, Eurythmics, The Police, Elvis Costello, The Clash, New Order. But the ambient noise made it impossible to know what station we were hearing. “I have to know what this is,” I said at last. “This could be my new favorite radio station.”
I tracked down the manager. He told me we were listening to Fred on 44, a channel on XM Satellite Radio. I’d heard of satellite radio, but didn’t know much about it. When I got home, I did some research.
As expected, there’s an upfront cost to obtain a receiver that can de-scramble the satellite signal. Unfortunately, that’s not the only cost. There’s also a subscription fee of around $10/month.
Alas — a subscription fee. They’re not deal-breakers for me, but they turn otherwise sure things into financial dilemmas. I don’t mind one-time costs, but subscriptions make me wary.
I would love to purchase an iPhone, for example. The initial hardware cost is fine. I can justify that. But I can’t justify a $60/month, two-year contract. That’s nearly $1500 for a device I don’t actually need. I stopped playing World of Warcraft because of the subscription fee. I loved the game, but in order to get my money’s worth, I felt like I needed to play more than is healthy.
I view recurring expenses as potential money sinks. Too often I don’t get value for what I spend. For three years I carried an $70/month deluxe digital cable package so that I could watch high-definition television. But at most, I was watching an hour or two of television per month! Besides, who needs to see Antiques Roadshow in high-def?
Over the past year, I’ve cut the number of magazines to which I subscribe, dropped to basic cable, and cancelled my Audible account. These moves have freed over $100/month. Eliminating recurring expenses has made a significant difference to my cash flow. Most of the time, I don’t even miss the things I’ve eliminated!
Of course, we each probably have a few recurring expenses that are easy to justify due to the pleasure or utility they bring us. I’m willing to shell out for The New Yorker because even though I only read about one issue per month, when I do read it, I love it. And if I find the time to listen to audiobooks again, I’ll re-subscribe to Audible — it’s a good deal when I actually use it.
I can’t decide whether paying for satellite radio would be smart or not. I’ve signed up for the free three-day trial of XM’s web service. So far, I like it. I’d probably subscribe:
- If NPR were available,
- If there were some sort of device that allowed me to receive XM on my iPod, or
- If it cost less.
As it stands, am I willing to spend $10/month for XM, and then pay for a receiver? How about $8/month for the streaming web version? I don’t know. For now, I’m just going to dig through my iTunes library to create some new playlists. I can probably duplicate the sound of Fred on 44. Maybe that will be enough…
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There are 115 comments to "Recurring monthly costs: Which are worth it? Which are not?".
I subscribe to Sirius, but after paying for a year’s subscription, I find I’m not actually listening to it that much. I can get the CBC on the Net or on my radio, many of the other shows I like are available somewhere on the web, and I find that I can get a truly eclectic playlist of indie rock, classics, and obscure goodies via The Hype Machine’s new streaming radio feature. (OK, so they’re playing Kylie Minogue right now. I did say they were eclectic.)
I agree that subscriptions are a money sink. I love The Atlantic, but even though my $32 subscription to it gives me both the print magazine and web access, I’m not reading it as often as I used to. My leisure time and toys, like my RSS feed video iPod, are stuffed with new music and my political, scientific and pop culture blogs and podcasts. I don’t keep up with all of those either, but at least they’re free.
I think we’re all spoiled for choice these days, whether we pay for content or not. I remember when my first Walkman was a big deal, as I could carry a small collection of cassettes with me and listen to my faves anywhere, any time. I remember running through a bitterly cold winter in 1991-1992 listening to Billy Bragg, Costello, The Housemartins, The Church and Pixies almost exclusively. I now have thousands of songs on iTunes that I probably cherish less than the handful I used to have on vinyl and cassette.
Like you I hate the monthly costs. However, most people I know that have XM love it. So, as a suggestion why don’t you cut $10/month from somewhere else or maybe sell something that you have, but don’t use, to offset the $120/year.
I have always thought that the best business ideas had a subscription type setup for less than $25 a month. That seems to be the magic number in which, if you can provide a service valuable enough for people to initially want, you can easily charge them month to month forever. For under $25 people don’t seem to think its a significant enough of an amount to really look into canceling. (Thanks NetFlix) lol.
You should really check out Pandora.com – Free streaming internet music – and you get to choose your music.
I listen almost exclusively to NPR…. I don’t think I would pay for XM at this point. I’m happy with my ipod for music and the radio for interesting stories.
I do think they have little XM-to-go type receivers which you can carry around as though it were an ipod…. but that would be another cost.
Maybe they offer a trial period, so you could determine if it was worth it to you. Some people do love it.
What about Pandora.com? It is internet radio and you can make any station you want. If you just plug in the songs that ‘fred on 44’ played it will take it from there. A little monitoring and you’ll be hearing everything you love and probably some songs you didn’t know your liked. The best part is that it’s free. 🙂
“For three years I carried an $70/month deluxe digital cable package so that I could watch high-definition television.”
FYI: there is a much cheaper way to get HD television – at least where I live. I found out that you can order the ultra basic cable (not digital) for around $12/month. Then you can add to that the HD package for $5/month. This HD package includes all the local networks (ABC, NBC, CBS, FOX) plus ESPN, ESPN2 and a few bonus HD-only channels like Discovery HD Theater. We don’t watch much TV, so this was the perfect way to get HD programming at a low cost.
Cheers!
Just FYI – Fred is available on Directv’s xm satellite radio offerings with most of their packages. It’s channel 834, I believe. If you’re paying for cable, might want to check this out as an alternative. There are usually deals so that you get free receivers and installation, sometimes a few months free service. Then you could at least listen at home, we do this quite a bit if we want to hear something new or that we don’t have on iPod. The price is competitive with cable in our area (South Florida – and yes, reception is good – even in our unpredictable weather). I promise I don’t work for them, but the referral bonus is generous (I’m trying to justify this as a frugality measure), so please remember where you got this info.
Yes, I am very wary of recurring monthly charges too. It feels like buying a printer, it is very cheap, but you end up spending a ton on toners! My ex boss used to say subscriptions are the best business model you can have. Once you have a loyal customer base, they will just keep buying and buying without a second thought and you don’t even need to do much marketing to acquire new customers. As long as the content is good, business will thrive year after year.
JD- you might want to have a look at Pandora: http://www.pandora.com/
Free over the web – you select music and it creates stations for you with music of similar style. Also available with receivers in home starting at $300. I’m under the impression that is the only cost to take it off the computer (also it works with Sprint cell phones).
No NPR, but great for music.
I couldn’t function without my XM! I have it in the car and the portable radio that I can bring it in the house. When at work I use the online stream which is free with a regular subscription. I listen to allot of baseball games during the summer and I enjoy allot of the talk programs not available on regular radio in my area. Now I can’t wait for the SIRIUS merger to complete so I can get the NFL games too. I generally pay a year in advance and it doesn’t seem to be such a money sink that way. At least, that’s how I rationalize it.
Hm. I forgot about Netflix. That’s an example of a recurring fee I don’t mind paying. (Well, actually that comes out of Kris’ money…) We watch 10-12 DVDs/month with Netflix, and it has really reduced how much I spend on buying new DVDs. This seems like a good deal to me…
I, too, am very wary of services/products with recurring monthly charges. I justify cable/internet because I watch a decent amount of tv and it acts as a balance to more expensive things I would otherwise be doing. I’ve begun a large purging and trimming of my monthly expenses in an attempt to get completely debt free and I absolutely hate monthly recurrences I cannot get rid of.
I would love an iPhone and would not have a problem paying the out of pocket expense but could not justify the $70+/month for service [even if I were not provided a perfectly good phone through work]. JD, perhaps the touch iPod is a good compromise for you?
I’m in my second year with XM, and we pay the fee annually, which is at reduced cost over the monthly bill. NPR programming is available on XM, but once you listen to CBC, BBC, and other news offerings, you start to realize how — I don’t know what I want to say — crappy NPR has become.
You and I are the same age, and I am OBSESSED with FRED. But then there’s Chill (84), which we listen to with dinner every night, Classic Soul (60 I think), which is so great for me because I only know about half the songs and usually love the other half when I hear them.
The nice thing about XM for music is that you can listen to a type of music rather than a cd. In fact, we rarely open our cd cabinet anymore.
Also, I bought the car adapter, which is cheap, and it will change your life for drives more than 1/2 hour long, especially across the country, when you might only get country and/or scary preachers for hundreds of miles.
Go for it!
I too dislike monthly costs, but I do my best to put them in relation to other things that I buy. For instance, I used to play World of Warcraft also, along with Final Fantasy XI before that. I justified the payments this way: They provided entertainment, so I compared their costs to other sources of entertainment that I would be using instead. For instance, going to the movies was about $7 (student discount). That means two movies a month was equivalent to the cost of the games, and playing the games meant I wasn’t going to the movies.
Of course, now I do neither and save that money instead 🙂 So I guess it’s all relative. But I guess the point is, you may be offsetting another cost with the new one, so be sure to take that into consideration.
Here’s another vote for Pandora! I love creating multiple different stations according to my mood and enjoying them for free.
I second the Netflix move (though we use Blockbuster Online). We used to average around $60-$70/month between going out to movies, renting movies, and buying DVDs. Now we’ve replaced that with a $17/month fixed charge where we get whatever movies we want. I’m not a huge fan of monthly recurring charges but this was a case where I could replace a variable cost that was a little out of control with a fixed cost I could control (by changing plans if needed).
Yo can get HD television for free. Most broadcast TV stations are broadcasting in digital these days. Indeed, come February, 2009, the FCC says that all analog broadcast TV signals will stop.
Many of these digital broadcasts are also HD signals.
To find out what’s available in your area, check out:
http://www.tvfool.com/
You can get good deals on antennas at:
http://www.solidsignal.com/antennas/
Need help deciding on an antenna? See:
http://www.hdtvprimer.com/ANTENNAS/comparing.html
Yes, a good antenna set-up may cost you a pretty penny. But it’s a one time cost. After that, all the TV is free.
We just started our subscriptions to Netflix and Gamefly after reviewing how much we were spending at the video store each month on movies and games. It was essentially a wash one way or the other, but the added flexibility of the online queues makes it a much better deal.
I can’t imagine paying for XM either. I’ve got 50-60 Gb of music I can use on my Zune (which has the FM tuner built in so I still have my NPR). My brother on the other hand, loves his XM, but he hooks it up to his home theatre, in the car and at his desk all day at work, so it’s worth it to him.
It’s all about perspective and what value you get out of the service you are paying for monthly.
I strongly dislike monthly payments and subscriptions, and try to avoid them if possible. But that is for my situation.
If digital radio is something you will use often, then $10-12 a month is not a lot of money. It is an even better deal when you consider you can use the receiver at home, in your car, and on the go (if you have the right hardware).
But, is satellite radio better than your current iPod? Basically, you music choice boils down to:
– Do you want to carry 2 music gadgets?
– If not, do you prefer to make your own playlist from your music (iPod), or have access to changing playlists, but risk not wanting to hear what your want, when you want (satellite radio)?
JD, you might also want to look into HD Radio. It depends upon what radio market you are in, but in my market there are several HD Radio stations that play music feeds that I enjoy greatly and they only insert station IDs rather than commercials.
HD radio requires you purchase the receiver, but after that the content is free, as it comes through on digital broadcast over the FM band.
I think you bring up a good point when you consider usage and pleasure as part of your decision whether to subscribe or keep a subscription.
For us, cable is not worth the monthly fees, but Netflix is. I know people love their satellite radio, but it isn’t something I’m like to ever subscribe to. There are so many other ways to listen to music for free…regular radio, Pandora, Launchcast, converting CDs we already own to MP3, doing the same with CDs borrowed from the library, etc.
In most cases, if I can get it for free, I won’t subscribe to it. And if I do subscribe, you can bet it’s to something I use day in and day out.
I’ve been a long-time Netflix subscriber, and found it to be worthwhile if we’ve got the time to watch the movies. The hardest part about getting your money’s worth out of Netflix is watching your queue and making sure that you want to watch the next movies that they’re going to send you. There have been times where I’ve played “Hmm, I’d watch that” with their recommendations because I was bored, only to have the movie come in the mail and then sit on my desk for the month because I was never interested enough in watching it to pop it in the DVD player.
Another thing to watch out for is Gym memberships. I joined the gym thinking “If I have to pay for this, surely I’ll make it a point of going”, I’m losing money there, and need to get rid of that one stat!
I played WoW while I was in college, but ended up canceling the subscription because I didn’t have enough time to play it to make it worth the $20 a month. I re-subscribed after graduation when I had spare time on my hands, but found it to be a lot of the same, there was a point where it just got boring. I’ve learned that it’s not worth it to me to buy a game that I’m going to have to pay to continue to play(I look at it as buying the right to rent the right to play the game, if that’s not confusing). Games like Battlefield [Vietnam | 2 | 2042] are better for me because I can play online for free.
As far as music goes, if you yard sale, listen to the music, and then eBay the cds, you end up finding music for basically free by the time you’ve paid for the cd, and then paid to sell it, the buyer’s paid all of your costs. It’s a great way to find out if you like new music, or collect music you might not have heard.
The worst part about subscriptions is that it’s so easy to forget that they’re there, and just take for granted the service, even if you’re not using it much. How’s that for a one hour money-saving project? Re-evaluate all of your subscriptions to be sure that you’re getting your value out of them (canceling any that you’re not).
One of the dangers of subscriptions is that the individual monthly bill is affordable, which can lull you into subscribing to lots of services over time. They quickly add up to something Really Significant. It’s the biggest problem I see with the subscription-based model for online services (like 37signals Basecamp, Highrise, Backpack, etc., and Microsoft’s “Live” software). Individually you think, sure this is affordable, but once you start subscribing to several services you end up paying over $100/month for it all. I am very subscription-resistant these days after having this happen to me more than once.
I have to agree on this one. Recurring payments bug me when it’s something I’d like to use, but won’t use often enough to justify the cost. However, I have quite a few recurring payments that are worth it – Internet, Family Fun magazine (which we do read and use), sometimes a Newspaper subscription when it saves money on the cover price (for the coupons, mostly).
For me, XM wouldn’t be a value – I don’t listen to enough radio/music to justify the monthly expense. I know others who are constantly listening, though, and for them it would be money well spent. I’d be better served with a receiver that could do MP3s, either via CD or flash memory of some sort. That helps me in long stretches of road where all I can get are NPR and Country or some really awful Pop/Top 20 station. With the MP3s, I can choose what I want and listen whether i have reception or not. 🙂
Sounds like you may benefit from an XM subscription, but I would also wonder if you’d build up a collection of music you want that could be streamed or carried with you. With the proper classifications on the files, you could easily play a type of music, an artist/group, or just random selections. While not cheaper in the short term, it could be in the long term. Of course, the downside is you won’t be exposed to new groups that way. It’s all about trade-offs.
As for the online gaming – that’s one thing I’ve never been able to justify, even if the game looks really cool, and some have looked like a lot of fun. I just don’t have the free time to spend several hours per month that I feel would justify taking part in those games. If I did, I’d have to pick one game to which I’d devote my time or try to balance a bunch of them.
Now the big question – how do you determine whether that recurring cost is worthwhile or not? When do you re-evaluate that cost? Often, it just becomes part of the background, especially those
monthly subscriptions are the bane of my existence. I’m currently at a stalemate with Comcast over my high speed internet connection. They recently bought out Time Warner or did some sort of trade and now there is no competition in our area. They want you to do a bundle package and if you don’t they keep increasing your rates. It has crept up nearly every month. If I put it on a per hour usage, sort of you did for your cable, then it seems reasonable, but still I hate it.
I negotiated my satellite bill so that even with fees and taxes it is $24 per month, which gets us most of the channels we watch. Although my husband keeps complaining about the lack of ESPN. So that may go up soon.
Good points about XM. I listen to the satellite stations that come with my tv package, which is nice.
Oh, J.D., this post made me laugh. You’re just 3 years older than I am, and what’s happened is we’ve finally become our parents, and we now like “oldies” on the radio like The Clash and New Order, hehe. But I just use YouTube to get my fix of all this stuff. In fact, I spent a good chunk of my day yesterday listening to this “oldie” over and over while I did paperwork here in my office (remember this one?) —
http://www.youtube.com/watch?v=1fNu-_TP9Z8
I too am not a fan of the recurring fee. I dropped the monthly $65 for basic cable and internet to only $13 for our citywide wireless internet here in Tempe, AZ. My one time cost for TV service has been the purchase of a new 32″ HDTV for $400 and I get great reception from all the stations that broach over the air (OTA) HD signals using a regular TV antenna. For radio, I am still waiting on some of the home players to come down in price or maybe an equivalent to the portable XM and Sirius receivers for HD Radio. It will be great to get free crystal clear radio with a lot of multi-cast channels to choose from. You mentioned audible.com. Well the libraries are adding these digital content download net libraries to their repertoire now. Using your library card number and password online, you can get ahold of ebooks, audio books and yes even TV shows, such as Antiques Road Show! 😛 Checkout your library to see if they carry relationships with MylibraryDV (http://www.mylibrarydv.com/), Net Library (http://www.netlibrary.com/) and Overdrive (http://overdrive.com/). Great stuff!
My 2 cents:
I think you can pay for a year of XM or Sirius in advance for less than the monthly subscription rate. I just saw something on Fatwallet.com that said for $77 you can get a year of XM. I don’t know if that promotion is still good. You can also stream commercial-free internet radio to your stereo with a cheap rca cable. You probably know this already.
If you want to save on magazines, consider buying subscriptions on ebay. I got Time for $17 a year, a 2-year subscription to Runner’s World for $18 and a 4-year subscription to Fitness for $8. Warning: only buy from sellers with thousands (not hundreds) of positive reviews. fyi – it can take 12 weeks for the subscription to kick in, but you can check the magazine customer service website to make sure your sub has been ordered after a month or so.
Love your article. Thanks.
We spend, each month, about $92 total for cable, HBO, and DVR packages. However (and I just counted) right now we’re watching roughly 25 hours of programming a week, which is the bulk of our entertainment, which takes our cost of per-hour programming down to under a dollar. This also doesn’t include when we happen to find something we’re interested in watching.
During the television “off season” I believe we had managed to find about 10-15 hours of programming that we enjoyed. Instead of “wasting” money at Blockbuster to fill in our time, each week we would hit HBO and load up our DVR with movies to get us through the “dead” days. We were taping and watching an average of 6-8 moves a week, which made the whole package very worth it to us, especially since HBO airs without commercials.
So, in my case, since we watch so much television (and quite a bit of it on cable channels as well)- and several overlapping timeslots, which is why we LOVE our DVR- I find our cable bill to be worth it, especially since it cuts down our movie theater/Blockbuster visits to about once every two months.
—slightly off topic—
For those of you who DO love movie theaters- Keresotes Theaters does have the Five Buck Club, which is great. You usually do have to wait two or three weeks to get the movies for the cheaper price. However, I’m a little hard of hearing, and I would prefer to see a movie in a slightly empty theater, so we usually do try to go mid-week or at other odd times.
For Blockbuster junkies, I L-O-V-E the Rewards program. (As a caveat, I used to work for Blockbuster, but haven’t for several years.) The typical Rewards program is $10 for one year, if they haven’t raised the price, but it allows you to rent one free “core” movie (from the center of the store) with any rental Monday through Wednesday. Additionally, five rentals will get you one free (which can be any) and you’re given one free core movie a month.
If you watch older movies (the core is usually one year old and older) then this pays for itself with the free monthly rental. If you’re good a planning ahead, it’s a great way to get more bang for your rental buck, or it’s a nice way to justify getting that movie that you were curious about but didn’t want to spend money on.
—back on topic now- sorry—
Personally, I would be terrible at Netflix. I’m already awful at remembering to mail things out, and I would feel like I had to watch a “certain number of movies” to get my money’s worth. For now, I’m going to stick with HBO, but Netflix does intrigue me. That’s really a subscription service I’m still evaluating for my personal needs.
I pay for cable and still have to watch commercials. Satellite radio, you’re paying to listen to maybe 5 stations at most, and at least a couple of them have commercials. I thought part of the greatness of satellite radio was no commercials. Since I already own most of the music i love, and i still go and buy quite a bit of it, why bother with paying for radio>?
I also stopped my simplyaudiobooks.com subscription and now I get get audiobooks on CD at the library. I can go online and request which books from other libraries in the area I’d like to have sent to my local library and they call me when they’re in. They’ve also started an MP3 system that I haven’t tried out yet. You can check out a small MP3 player that has only the one book loaded into it. Or you can download the book at home and I think it disappears after your time is up. You can also load the downloaded book onto your own MP3 player.
I’m getting through a lot of the classics this way. I go to Audiofilemagazine.com to find good narrators. (Some articles require a subscription but I’ve gotten a lot of info from that site even without the extra features a subscription provides.)
I find the library system is much easier than I expected.
NPR – download your favorite shows for free through their website, or Itunes
Audio books – check your library. My public library just started offering audiobook downloads good for a month.
Netflix – create your own queque from your local library’s website. I haven’t paid to rent a movie in years.
Oh yeah, I forgot to mention that my wife and I get almost all our movies from the library. Our libraries carry everything, and I mean everything, even r-rated horror movies like Hostel and Saw and whatever … I just borrowed INLAND EMPIRE a couple of nights ago. So people might want to check w/ their local libraries … of course it helps that my wife is a librarian and can snag the good stuff as it comes in, but this is a great free way to keep up w/ movies.
I don’t think I could justify spending $10 a month to listen to radio. The way I look at it, how many hours a day do you really LISTEN to the radio, I mean sit there and enjoy every song. Most of the time, when the radio (or TV sometimes in my case) is on, it’s just background noise. Yeah, I try to find a station I like, and yeah, if I catch a really great song it puts me in a good mood, but I don’t sit there and pay attention to song after song. So I would take the time you listen to the radio and decrease it by the time you actually LISTEN to the radio. I would bet that time is much less and the cost benifit ratio is much higher.
Dave, I’ve never heard that Misfits song before. It’s funny, though. Yesterday I went to YouTube, too, looking for some songs I hadn’t heard in a while. It was great to hear “Bring on the Dancing Horses Again”, but good grief that video is awful:
http://www.youtube.com/watch?v=GaWs79v0ugE
And oh my goodness. Here is my single favorite song if all time:
http://www.youtube.com/watch?v=sHnXOSxka1Q
U2’s “Bad”, the Live Aid version. I could listen to that all day…
NPR is available on XM, I think it’s channel 130, but I could be wrong on the exact station. They also have a bunch of other great talk stations (I prefer Air America on 167 myself.)
I’m a Sirius subscriber and love the service. I don’t have a car anymore so I’m selling my receiver but I’m keeping the internet radio account (at least through the end of the subscription). I listen at work over the internet.
J.D. I suggest looking on ebay for an sirius internet radio account. I didn’t see any when I looked a few months ago except for the one I sold. Since sirius gives you a free internet account with each physical radio. I had two physical radios but only needed one internet account. It sold on ebay a few months ago for $26. A great deal if you ask me.
Alternatively maybe one of your readers who has a free internet account but doesn’t use it (or doesn’t know and hasn’t even set it up) can let you listen for free.
I view recurring expenses as potential money sinks. Too often I don’t get value for what I spend. For three years I carried an $70/month deluxe digital cable package so that I could watch high-definition television. But at most, I was watching an hour or two of television per month! Besides, who needs to see Antiques Roadshow in high-def?
Amy Dacyczyn of the Tightwad Gazette said that cable tv was like a barometer. People who were paying a monthly bill for cable and were deep in debt simply didn’t get it. She felt that those people should not only cancel cable, but also sell the tv and use the time more productively, such as money saving hobbies or earning money to pay off the debt.
We do not have cable tv here, but we do have a regular antenna to watch non cable tv and Antiques Roadshow is one we watch. I personally do not want cable tv because I don’t want another monthly bill to pay, its simply not worth it to me.
Belinda
Here’s the deal:
This goes for folks that don’t have an HD television and are not looking to waste money on those things to increase the amount of payments they fork out for their entertainment budget every month. Go to TVLinks.com. There you get a very large number of shows, documentaries and movies that can be streamlined to your computer for your enjoyment for free. That is how I got rid of an expensive $90 digital cable package. Also, for some of the heavier phone users, think about using VOIP systems like Skype. You can very cheaply, get AN ENTIRE YEAR’S WORTH OF CALLING IN ANYWHERE IN US AND CANADA FOR ABOUT $24.00 FOR HOWEVER LONG YOU WANT AND ANYTIME. This definately helps out if you do a lot of calling before your nightime minutes kick in for your cellular provider if you have one. I also agree with some of the peoples’ decisions to get rid of their monthly subscriptions to magazines that they don’t read too often. As for the music thing, I usually will just go onto music streaming channels and listen to the free music they got up there. It works out real well for music that has been out there for a while. New music, you would still have to either buy from iTunes, eBay, or you could always borrow from a friend. Hope this helps.
I don’t subscribe to radio, but if I did it would not be XM, it would be Sirius – where NPR is available for you, and Stern and a host of other things.
A friend of mine uses Verizon cell service and has Sirius. He has a Motorola Q (not the newest one that just came out) and can actually stream Sirius to his phone, via the web browser. He uses that feature daily when on break at work, and gets every cent out of his monthly fee for Sirus and the data plan for his phone.
I hate recurring costs. Somehow, I need to find a way to heal my internet bills. TV is terrible, so I cancelled that. Next to go is water, power, and heat…those will be tough.
We have Sirius and we love it. They have a product called the Stiletto that is a portable receiver plus an mp3 player. By using that, you can listen to it at home, in the car, and on the go without having to buy separate receivers or separate subscriptions.
The biggest downside we’ve noticed is that if you’re in the car and you go through a tunnel or under a bridge, you lose signal. It’s not a problem here (no tunnels) but I wouldn’t recommend it for someone who had to go through long tunnels on a daily basis.
I have a habit of going through our budget and cutting recurring monthly expenses …all the time. It hurts to spend money on, say, a gym membership when you’re not using it this month. Unfortunately, we’re in a 2-year contract with them, and it’s $350 to cancel early (yipe!), so we’ll be keeping that particular expense until it expires…and using it as much as we can stand.
There are two recurring non-essentials that have value for us:
-Netflix. Hoo boy. We just finished the entire series of Star Trek: Voyager. I’m all about getting free videos at the library, but they don’t have that kind of selection! We may cut Netflix for a bit while we’re only getting movies, but once we get back into a TV series, it’s Netflix all the way. Did I mention we don’t have cable?
-MMORPG. Pick one! Seriously, my husband and I really enjoy playing online games together. We only have one subscription at a time, and when we get bored with a particular game, we cancel it until we’re in the mood to play it again. Yay for month-to-month billing. Gaming gives us something fun to do together, which keeps us from getting bored at home, which keeps us from going out and blowing the budget on entertainment. It’s just how our minds work.
We have XM Satellite radio here and I have to admit it is really cool. I believe to subscription for us was free for a year, but I can’t remember how that came to be. Anyways, I prefer, too, if there were just a one-time fee as opposed to a subscription, but I don’t think they’ll be changing their pricing model anytime soon. It sure has been working.
I think an iPod playlist that mimics the station is your best course of action here. I like to do all my music listening on my iPod to make sure I’m really getting use out of the music I have purchased for it and getting use out of the iPod itself. If I were you I’d start by making a “smart playlist” that includes all of the artists you listed and add additional artists as you think of them. You already paid for the music either as CDs or digital files so you should use what you have rather than paying for it again via satillite radio. I recently wrote a post in my blog about playlists for the iPod http://haveless.blogspot.com/2007/09/managing-large-music-library-on-small.html
For people who spend a good chunk of each work day in their cars, like SF Bay Area commuters, XM radio might be a good choice. I have a coworker who listens to his portable XM reciever (or maybe he’s on Sirius?) at work; he seems pretty happy with it. But there are plenty of internet radio stations around, so the at-work usage seems less valuable.
I also like how the satellite radios play channels you won’t find anywhere else. I happen to like both trance and bluegrass music, but those aren’t station types you’ll find in most of the US.
I break up monthly-recurring costs in to three categories. (1) Required, things like electricity, rent, and cell/internet which I need for my telecommuting job. (2) Acceptable if used regularly, things like XM radio and Netflix. (3) Crappy deals to avoid, things like cable TV and most cell phone add-on services.
Category (2) stuff needs regular review to see if you’re getting your money’s worth. If not drop it sooner, not later.
Omg, Bring on the Dancing Horses — I haven’t thought of that song in years. But you know, J.D., there’s no objective reality anymore w/ these sorts of songs … the songs we were all exposed to as kids and teenagers, for better or worse, become “our generation’s” songs, and those songs will sound good to us *no matter what.* This means, God help me, I’m stuck loving shit like this —
http://www.youtube.com/watch?v=lRTVi7rH_zs
There is a way to may XM Radio work with your iPod, but it’s a bit nerdy:
There’s an XM radio device called the XMPCR which connects to your computer via USB and a line-in audio cable. Now, the XMPCR is no longer being sold, but it is supported by XM, so if you buy one on eBay or Craig’s List or whatever, you can call up XM and subscribe, or add the device to your existing subscription for $5/month.
The device comes with XM’s software to drive it, but there’s a third-party solution called TimeTrax which allows you to save the XM streaming audio to your hard drive as MP3 files.
Doing so is legal under fair-use, just like recording FM to cassette is.
XM doesn’t have an NPR channel, but they do have XM Public Radio, channel 133, which does have content from American Public Radio, Public Radio International, Boston’s WBUR, George Washington University, and National Geographic. NPR has an exclusive contract with Sirus satellite radio, but that might change if/when they merge with XM.
I’d be happy to talk more about this solution, should anyone desire further info. The main limitation is obtaining XMPCR devices on the secondary market, but they are out there, and the price has come down since the “rush” when TimeTrax made news a while back.
If you like XM radio, try the AOL Radio online – they stream some of the XM radio stations for free. A free AOL/AIM screen name is required for some stations, but it may be a good alternative.
I have sirius, and love it. NPR is available with a lot of other news feeds. I started subscribing in january, i got in on a good deal and picked it up at far less than the normal subscription price. One option might be for you to find a friend who has it and piggy back their account. You can add additional receivers to an account for about 30-40% of the normal monthly subscription cost. I’m not certain of these #’s for xm (or sirius) b/c i have not investigated it recently.
You can get XM Radio for FREE!!! GO thru AOL.com (AOL Radio), I think the only thing you need is an AOL IM account (which is also free). You can then listen thru the internet. Go to XM site for details.
I love XM esp BPM & FRED.
I am with Carrie on using your existing library to create the “Fred 44 channel”. Otherwise you are just renting your music from XM/Sirius. Why not set aside $10 a month for a CD you really want then you can build up a library of music that you actually own and have the rights to?
I would bet that most months you would never even spend that $10.
You might find this guy’s blog interesting:
http://hdradiofarce.blogspot.com/
There are things I buy that make me feel good and make my life easier such as:
New York
New York Times
Gym membership
Bus pass
Magazines
But some of these purchases I feel guilty about. I could view all serials online (save the environment and save $$), but I like to have the paper in my hand and read it on the couch. Because I ride the bus just 4x a week, I could probably spend less $ on the fare if I paid in cash, but I don’t want to have to find $1.50 in exact change every morning. In my household, that is next to impossible. So the pass provides ease at an expense I’m willing to take.
Recurring expenses have emotional and lifestyle components that for me sometimes override the cost factor.
The one thing I’ve noticed with many of these stations is that after a month or two the novelty wears off. Just like on good ol’ FM, XM and Sirius are going to play mostly “the hits” of whatever era or genre the station is designed for.
Only rarely do you ever hear a, “WOW! I haven’t heard this in forever. I love this song!” after the first few months of listening. This usually occurs in the wee dark hours of morning. Even more rare is to hear a song you’ve never heard before.
I had Sirius satellite radio for a while, and it was nice because, as someone else mentioned, you are able to listen to a whole genre of music without having to listen to just one artist. But I haven’t subscribed to it in a long time and now my satellite radio sits unused in a desk draw…very sad.
I have also been trying to cut down on things I subscribe to monthly. So far, no more cable bill or gym membership. I do subscribe to Netflix, but I gotta be able to watch something, and also pay monthly for internet. I have a couple of magazines but probably will not renew them. I think thats it for subscriptions so thats not bad at all.
Stick with free.
Several people have mentioned Pandora.com. Totally. Go with it. It, like, reads your mind! It is YOUR perfect music. I don’t think I will ever purchase music again, itunes or otherwise. No need. I have Pandora. Also check out radioparadise.com. Again, free, and I think you’ll like it. Don’t pay for what you can get for free (though they do deserve donations).
Um, can’t you also listen to NPR for free through their web site? We subscribe to the free podcasts for our favorite NPR programs and listen to them when we feel like it.
Free, dude.
Recurring expenses can be a budget buster, especially when they aren’t necessities. The recurring expenses I don’t begrudge are these: gas, electric, telephone, internet, property tax, insurance, water & sewer (I don’t think I’ve missed any). I do subscribe to some magazines (SciAm, Discovery, Fast Company, and Popular Woodworking). These are luxuries that I’ve decided I enjoy but they could be cut at any time, and every year I reassess.
Recurring expenses become invisible if we let them. It’s important to look very carefully at these costs and eliminate them whenever possible: if you can eliminate 10 recurring $10 expenses, that’s $100. If they are all monthly, you’ve saved $1200 over the course of the year.
As part of this constant re-examiniation, last month I did away with long distance on my land line, since I’ve committed to keeping a cell phone. This will save about $10-12 per month, because we can’t accidentally make long distance calls on the land line any more.
Speaking of cell phones: the power of recurring service charges is the reason why signing a two-year contract gets massive discounts on the phone itself: the profit to the phone company is almost all in the recurring fee.
Several people have mentioned XM and Netflix:
I’ve determined that NetFlix is not worthwhile in our house: I put up with a smaller selection and rent from the Public Library at $1/week (it becomes very difficult to watch enough movies to recoup the NetFlix subscription at that rate). And I would never pay for radio.
With an iPod loaded with all my CDs, I have more music than I could listen to in several days of continuous play. And another listener recommended Pandora: this is a great way to hear new music that you enjoy. I’ve found that after a handful of feedback, Pandora plays on target. It’s great and free.
It’s definitely a dilemna I’ve run into as well. It depends on if these are new luxuries you’re bringing on or if they will be a cheaper substitute for something else. Will you stay home and watch a Netflix movie just once a month if you have a subscription? Will you download 10 less songs to Itunes because you have sirius/XM radio?
That’s typically how I run through decisions about recurring monthly fees.
Just as items purchased by subscription may have hidden fees, they may also have hidden savings–and sometimes those aren’t obvious on first glance.
For example, my husband and I pay nineteen dollars per month for our Blockbuster subscription. One could argue that we could get movies for free from the library, thus this subscription is an unnecessary expense.
However, we’ve enjoyed receiving movies in the mail so much that we’ve stopped attending new releases. This means that we’re no longer paying sixteen dollars to enter the theater, five dollars for popcorn, fifty dollars on bar food afterwards, and all the gas for the entire excursion.
It also means that we no longer feel the need to purchase movies or television shows we love, because we can order and re-order them at any time without having to store them.
It also means that I have access to a massive amount of hour-long television shows, which with commercials removed are just the right amount of time for my daily cardio routine. I no longer feel the need to rent or purchase exercise DVDs, and I’ve also eliminated my monthly subscription to the local YMCA.
Thus, thanks to nineteen dollars per month, we’ve cut our monthly entertainment budget to one-third of what it was previously.
NPR is free and offer better quality programing than any other radio. If you’re near a computer then services like Pandora and LaunchCast are free and offer you the music you like. (Note, I think LaunchCast does charge for their premium service which removes the ads).
I have no clue why people would pay for these satellite stations. Seems like a complete waste of money.
Gal
great topic.. this makes me think about the recurring bills i have and which ones i actually do need
– dsl/phone bill (are there cheaper and better deals out there?)
– pre-paid legal member $16 a month (i’ve been paying for this for 2 years and have never actually used it)
– netflix $15 a month (rarely watch movies but i do every once in a blue moon)
– world of warcraft acct. $15 a month (only reason i haven’t cancelled yet is because my brother still plays)
– iphone (extra $20 for data plan).. yeah i must admit it’s NOT a neccessity.. but it does come in handy when i’m out of town or on vacation.. i was able to check my email for flight confirmation last week.. get directions to certain places i wanted to go.. and i was able to surf the net while sipping on a mocha in seattle =D
I spend hardly any time in the car so for me, satellite radio isn’t very tempting. My problem is magazines. I’m a serial subscriber. I love to read, but don’t seem to have time to invest in books, so magazines are a good alternative. But, before I subscribe, I always check the magazine in question out and make sure that about 75-80% of the content will be useful or interesting to me. Then I look at the price. I’m willing to pay $1 an issue for the convenience of having something I will read delivered to my door. Upwards of that, it better be something I will not only read but keep and use as a reference – home repair magazines fall into that category, as do knitting magazines, two passions of mine. I know I could go to the library but my library won’t allow magazines to be checked out, and copying costs .35 per page, so that seems about a wash in the end for something I will refer to heavily. And, instead of discarding magazines once I’ve read them, I donate them by boxing them up and taking them to hospital chemo rooms. In the end, I’m talking about 10 magazines I subscribe to and read per month, 4 of which I will keep and 6 that I will give away. I don’t feel too bad about that, but only because I feel like I have made my choices carefully.
Reoccurring fees are definitely a sink-hole. It’s important to examine your contract before signing up for them. Often times, there are hidden fees you can incur by canceling your membership/subscription, or you may have to extend your contract for any changes (as with cell phones).
I had a membership at a Golds gym for $30/mo…it was supposed to be for a year. So after a year, I went to cancel my membership (as I didn’t use it often enough to justify the cost)and I found out the trainer put down 2yrs…I didn’t inspect my contract to make sure it was the terms we discussed! Being a college student I was very broke, and this was an expensive lesson to learn.
Now I thoroughly inspect all my contracts!
Subscription services are a brilliant marketing gimmick. They provide the company with a steady stream of revenue (a guaranteed stream if they make you sign a contract and commit to a set amount of time.) And they provide the customer with the needed rationalization to convince themselves to buy in. How many of us look at something like this and say “It’s just 10 dollars a month, that’s not that bad.”
The problem is that 10 dollars here and 5 dollars there add up very fast. It’s very similar to the problem I have in the grocery store. I tell myself that it’s only a dollar or two. Then I’m looking at the receipt and I’m wondering why I spent more that I budgeted.
For me, when I look at a subscription, I ask myself two questions.
1. Will I use this a lot beyond the first month or so? (Usually no.)
2. Would this seem like a lot of money if I had to pay for it all up front?
If I can answer yes to both of them then I go for it and I pay it up front.
J.D.,
When I bought my last car, it came with XM and one year free subscription. I love it, but I hated to think I was “marketed” into buying the subscription. I waited before renewing, and they offered me a one-year deal for $70/yr. I took it. Now I pay my subscription annually and get a reasonable discount.
I listen whenever I’m in the car and when I’m on the computer (free with your subscription). The best is car trips into remote areas – so far no dead XM spots! So far it is WELL worth the cost.
Cheers,
Lisa
A point related to yours about recurring costs is that it’s not necessarily a good thing to put one’s bills on a credit card or set to deduct automatically from a bank account. That does make certain they’re paid on time, true, but it also enables you not to have to think about them. That gym membership charge, for example, may continue long after you’ve stopped going, if payment of the fees is not required to be a deliberate thing. Writing a check or having deliberately to make the effort of paying it online keeps you conscious of your expenditures.
J.D.,
Just discovered your site last week (thank goodness!)
The one recurring cost I jettisoned 3 years ago with no regrets was the cable bill. I have three kids and they’d come home from being at their dad’s for the week (we divorced three years ago – guess who signed us up for the $189.00 cable service in the first place!) and bee-line straight for the T.V. When I realized I could recite the lines of the Sponge Bob Squarepants episode they were watching it hit me that I was PAYING for my kids to watch RERUNS!
Now I don’t know how we ever found the time to watch T.V. in the first place. We eat together, we sit around the table and goof off while they’re doing homework, I read stories at night before they go to bed…all of this we “never had time for” before.
We have a $4.99 Blockbuster online subscription for one movie at a time. $4.99 beats $180.00 (plus the taxes and fees, etc.) that I was paying before. Now if I can just stay strong against their overpowering, all-consuming desire for cell phones….
Penelope
One other aspect not considered is most* satellite radio stations are commercial-free.
(* – I have XM and only a handful have actual commercials – then only the news/talk/comedy stations do, none of the music stations do).
While I gather you are fairly resistant to marketing, there might be some money saved it not having to listen to how the local car dealer is offering… NO LESS THAN $3000 FOR YOUR TRADE-IN!!! Push it! Pull it! Shove it in today!
Not listening to that is worth the price of admission to me. Also, I’d echo earlier comments – some due diligence can get the monthly price down significantly.
BTW – I must be a bit younger, since the stuff on Lucy is more along the lines of what I grew up on. In the stream of alternative on XM, it starts at Fred, then Lucy, Ethel, and finally probably XMU.
I understand your point about the subscription cost…Much like your cable and WoW I guess it comes down to how much you use it. Both my wife and I have had XM for about two years and we absolutely love it. I listen online, in the truck, and on the go (streaming to my Treo) IMHO, we use it more than enough to justify the costs.
Oh, and XM has “XM Public Radio” featuring Bob Edwards and others, but I do not listen to NPR so I am not sure how they compare.
http://www.xmradio.com/onxm/channelpage.xmc?ch=xm_public_radio
Monthly bills add up fast. Here’s what we have done to limit the monthly bills:
– TV — we dropped to basic service, and get the HD channels over the air. For free.
– Netflix — to compensate for the basic cable, we get the $5 2 movie per month plan for Netflix. It’s the amount we manage to watch anyway, so I don’t need unlimited.
– Phone (land line) — we dropped long distance entirely (it was two times the taxes) and use calling cards. Now we have switched from unlimited local calls to a lower monthly fee, but paying 10 cents per outgoing local call. Turns out to be a $9 monthly savings because we rarely use the phone.
– Cell phone — we have one that we got at Sams Club for $30. It included $10 of airtime and is a simple pay-as-you-go phone service. Works out to be $8 a month.
– Gym membership — we do use the gym regularly, but were able to negotiate 3 months free if we prepaid a year.
– We called Comcast and got our internet down almost $20 a month by explaining to them that we would switch to Verizon’s FIOS service since it was cheaper. This lower rate lasts a year.
Sometimes, it just takes a quarterly review of those monthly expenses to find places to cut back without even noticing the difference. And make you appreciate the extras you decide to keep (like the Washington Post and various magazines I subscribe to).
I am like you with not wanting to pay subscription fees and I resisted the urge to get XM for a long time. But when I was given a receiver for xmas, I decided to try it.
Mine is a portable unit that also records up to 25 hours of XM. I love having it in the car because I can always pick up stations i want to listen to if I’m in town, on my way to another town or visiting a place where I know nothing about local stations. My commute is 20 miles and the XM reception is nice to have all over.
Since my device records (a function I highly recommend), when a song comes on that I think I’d like to hear again, I hit “record” and it magically records from the beginning if I catch it soon enough – so, I can grab the device out of the cradle and have a fully loaded player without ever having to deal with hooking it up to my PC, copying CD’s to my hard drive or buying stuff from iTunes or whatever. I also have the home cradle so I can set it up to record particular shows/events that come on at night.
I would like NPR to be there, too, but I enjoy the variety of music that I could never manage with my own CD collection or on a local radio market. I could probably do better stuff with the subscription fee, but I don’t subscribe to cable T.V. and I feel I get more enjoyment out of the XM anyway.
For me it is cell phones, I have thus far managed to live life without one. There have been numerous times it would have been nice to have, but I just can’t justify the outrageous fees for basic service. I already think that home phone and internet is ridiculous where I live (only one real provider and you have to buy one of their package deals) I end up paying about $80 a month for basic phone service and the slowest DSL they offer adding another $70 a month to that just seems too much. A previous comment talked about prepaid working out to less than $10 a month, maybe I’ll have to check that out.
Recurring monthly costs are something that I strive to avoid. I was given a Palm Treo 650 in April as a gift (the speakerphone stopped working, and my trucker father needed that feature, so he gave the 650 to me and bought himself a 700 – great for me!) I am not locked into any kind of contract, and so I could get phone service without paying for the data — but even the $10-$15 a month I would spend on that has led me to carefully consider how much I need a cell phone. (So many people look at a cell phone as an absolute necessity — I have seen occasional need for it, but mostly it would be a convenience. How much money is convenience worth?)
I’ve also been thinking lately about web hosting. I spent $10 a month for web space that I originally purchased for my mother, to use as a family photo album. We’ve been far too busy for either of us to keep it updated, but I keep paying for it because I think it is too useful to give up on (especially email — 80% of my family members use email addresses from this domain). I also have been asking myself why I continue to pay $10 a month when I could pay a year at a time for about a 15% discount.
So why don’t I switch to the annual payment schedule? Well, mostly because I’m lazy. Inertia is such a huge threat when it comes to recurring expenses. It is easiest to leave things alone, as mentioned by My Road To Wealth @9; that’s why businesses love the subscription model.
Well, one good thing has come from this preponderance of pondering: I am adding to my GTD action list two items: Switch the web space payments to an annual basis, and look through my finances to see if there are any other recurring costs that I should be reviewing. (I’m going to focus especially on annual costs for the second item — I think a lot about monthly things but annual stuff flies under the radar!)
One final note: I apologize for the phrase “preponderance of pondering”. It popped into my head and made me chuckle, so I had to use it. 🙂
The prepaid cell phone plan through T-Mobile is the cheapest in our area. No monthly fee. The minutes expire in 3 months, but if you buy more minutes, all the minutes roll over to the new expiration date. And once you have spent $100 on the minutes (not all at once, it is cumulative), then all the minutes expire in 1 year, not 3 months.
It is geared for people with credit problems, but it also works for cheap people like me!
I really, Really, REALLY want a Blackberry. Everyone I do buisiness with has one. (Lame reasoning, I know.) I’ve wanted one ever since I set eyes on it BUT, I just can’t financially justify it. Buying the gadget would be OK, but the montly data fees! Yikes! Maybe someday I will become so indispensible that the cost would be justified, but I don’t see that happening anytime soon. Oh, well. I’ll just go pout in my corner.
I was amazed at how much money I freed up by systematically going through all of my credit card charges and debit card charges and deciding whether I should continue the service or not. It is the invisible ones that are charged that added up for me.
After looking at them all I decided to keep:
Sunday only NYT (after they gave me a 50% off special. I pay $13/month for it.)
The $2.99 cable sports package that shows local and odd sports on 4 channels.
$11.99 credit aware service offered by American Express.
That’s it. I cancelled all my magazines when I began spending more consciously. And I justified the cable sports package by signing up for another 2 years with sprint and they gave me 10% off my basic cell phone service. That was a savings of $3.25 so my budget didn’t feel it at all. My logic is if I have good sports on at home I won’t go out to watch games and spend money on food or beverages.
Drat. I *should* have signed that:
“I do whatever my quicken tells me to.”
😉
A fun thing to do with the cable company… About every 6 months I call and start whining and asking if there are any cheaper packages available. I almost always get them to give me the “special of the week” with no reduction in my subscription. Sweet!
J.D. –
We have XM in our house via a portable player I bought for my wife a few years ago when she spent a lot of time on the road. Her mother also has XM, and I think there is a family deal that reduces the rate for both households. The best part is that my wife’s annual XM subscription has become a recurring gift (can’t remember if it is Christmas or birthday as they are close together), so we don’t worry about the cost.
Put it on your wishlist!
Sarah @ 55 –
At the moment, my bus pass *IS* my gym membership. 🙂 The most convenient busses start .2 from the house & drops me off .6 mi from the office. It also includes a couple hills. Toss in morning crunches, yoga, squats, and such, and I’m getting into better shape.
Cable is so expensive these days. My semi monthly (Comcast has a very strange billing cycle) bill is $150 a month that gets split three ways between my roomates and I. My parents pay close to $200 a month and they get everything!
I was just looking at my cell phone bill and realizing I never come close to using my allotted minutes, so i made the plunge and downgraded my plan. T-Mobile makes this a breeze by going to your online account and merely checking the new plan you want. I only save $10 a month, but that is $120 a year with no side effect to my service at all.
Recurring bill payments can also contribute to the money trap. Sure, you will never forget to pay your bill on time, but you will most likely lose track of the bill over the months. I always go over all of my bills looking for ways to trim them down to keep more money in my pocket.
Oh yea, I forgot to mention that if you want to listen to some great music check out Pandora.com or Finetune.com which let you make free streaming playlists. There is also the slightly less legal Seeqpod.com where you can stream and download your own playlists without any restrictions!
I have to give kudos to Pandora and internet radio in general. It’s free, and can be a great way to find obscure new music along with your favorite classics.
My roommate has the portable Pioneer XM receiver…which gets almost no reception/battery life when off of its cradle/ext antenna…making it barely “portable” away from the home/car…wouldn’t recommend it.
Also I’ve listened heavily to both XM/Sirius to find that after a while it just seems like a repeating playlist. (Sometimes searching for something satisfying has ended up with me just turning it off, and looking elsewhere.
I’d advise to “go the online route”…might take a little more effort to find what you want, but when you do, its free, and usually more diverse. Then you can build your portable-player collection around your findings.
I have found that moving abroad for a year allowed me to “reset” all my subscriptions and recurring costs to zero. Because I had to take an active role in adding back those expenses when I returned to the USA (signing up for netflix, etc), I got to be very conscious of where I was choosing to spend money and not have any issue of inertia that kept me spending money. For me, basic cable TV is totally worth it, as is internet, but most other things I can live without. One “hack” that I’ve been using since I got back to keep me on top of money-sucking subscriptions: my credit card lets me create new numbers for online shopping (the program is called ShopSafe, but I’m sure a lot of cards have a similar thing). Basically you enter the maximum amount that can be spent on the card, and when you want the card’s expiration date to be, and the bank produces a temporary card number with the limit and expiration date you choose. I do this for all my subscriptions, so that when the card expires the company gets in touch with me and I have to actively choose whether to renew again. (As people say, the company always gets in touch with you to update your payment info – you never just get cut off without warning.) I’ve been setting it to reset my subscriptions every 6 months, but you could do longer or shorter if it works for you.
i second the pandora.com suggestion for terrific music. put in the list of music that played at the restaurant, and see what it gives you in return. you can always refine from there to create YOUR ideal “station”.
and secondly, although this may not be completely legal, find a friend that has XM, and offer to pay him $2 per month to use only the web stream portion of the service. I know a few friends of mine would take you up on that in an instant!
live365.com is another website that streams music for free. It takes a little time initially to find the stations you like, but once you do you’re set.
Monthly subscription fees are awful, aren’t they? I think the cable companies must be rolling in the money. Not only do they charge per month, but their rates continue to go up and up.
One thing to look for when a new service starts up that you may be interested in is a permanent or lifetime membership. My husband has a lifetime membership for his Tivo, so we don’t have to pay any monthly rate. I have a permanent LiveJournal account so I don’t have to pay the annual fee. After four years, it has paid for itself.
The lack of value for us in a monthly fee was what kept my wife and I from getting cell phones for the longest time. We’d periodically look into the plans but even the cheapest ones were about $15 which wasn’t worth it based on the minutes we’d use.
Eventually my wife got a cellphone from work that she can use for the occasional personal call. Also, a friend of mine who was upgrading his phone gave me his old one in exchange for a pint of beer. I signed up for a prepaid account and have been using maybe $7-8 per month, even with the higher per-minute rates.
“As it stands, am I willing to spend $10/month for XM, and then pay for a receiver? How about $8/month for the streaming web version? I don’t know.”
I have this argument with my friends when they’re tempted to get satellite radio– Why not buy 1 or 2 albums a month instead of a radio subscription? At the end of 1 year, you’ll have a well started music collection to show for your money rather than NOTHING. For the same amount of money, the pros/cons of buying albums far outweighs any satellite radio subscriptions, in my opinion.
I have to agree how frustrating those monthly expenses are…. but XM radio? unless you spend a significant amount of time in your car, I think that one is tough to justify, especially with internet radio….
my only existing monthly bills are the YMCA ($41), which I use a few times a week… and I consider a very reasonable “investment” into my standard of living as far as health and stress reduction… I sure feel great after my wednesday night Ashtanga yoga class…
and the other bill is Verizon ($50)… I do not have a home phone, so the cell phone is necessary to communicate. I have magazine subscriptions that amount to about $7 a month if you break it down…. that’s roughly a dollar a magazine… I cut drop those, but I get so much out of the magazines, and usually pass them along to friends and coworkers once I’m done….
Okay — I’m trying Pandora now. (The “A Fine Frenzy” channel, actually, since that matches my mood right now, instead of the “fake Fred” channel.) After seeing this, I realize I tried Pandora two or three years ago. I’m not sure why it’s never occurred to me to try it again…
I’m surprised XM is still in business–i beleive there is a merger in the works w/sirius–my bet is XM wont last much longer either–there are some great free streaming radion on the web–i say dump it!
My monthly fees are: the newspaper, 24Hour Fitness membership, and Blockbuster Online.
The newspaper costs me $11 a month. That comes out to $132 a year. It’s definitely worth it for me. I use coupons and the amount I save with coupons is more than I spend on the paper. I could just get the Sunday paper delivered for $9 a month, or drive to the store and pick up a double edition (twice the coupons!) for $2 each, but I read four sections of the paper everday, and more on Sunday.
The gym. For me, again, it’s worth it. 24Hour Fitness has a corporate membership which I’m available for, so I get a discounted rate, and I didn’t pay sign-up fees. I did opt for the “multiple gyms” membership instead of the “single gym” membership. I use two of the gyms near me, two by my parent’s home, and another in Northern California whenever I travel. I attend the yoga classes regularly, and some of the other classes. I currently pay $35 a month ($420 a year.) It’s pretty steep, but I use the gym often. When I signed up, I opted for the monthly plan because I wanted to make sure I would continue to use the gym. Now that I have, I’ll be paying a $600 lump sum for three years ($16.67 a month) and if I’m still with the gym after that, my month rate goes to $5 a month. The $600 plan is now an excellent deal for me.
Blockbuster. Oh, dear. This is where it’s dangerous. I chose Blockbuster over Netflix because of the “Return to Store” option, plus there was a special offer. I’m on the three movies at a time plan, at $19.38 a month, and can end up with seven or eight movies in a week. I calculated that I’ve spent $1.36 per movie. BUT I gotta look at the big number: $155.04. Ouch. Yeah, the per unit cost is cheap, but the overall cost is not. My schedule is going to get busy again in the next few months, so I may not be able to keep up my movie watching pace. I’m thinking I’m gonna cancel my Blockbuster Online account – I can always sign up again later.
The key thing for me when it to comes to monthly costs: how much is it costing overall?
I agree that limiting recurring monthly expenses is key. One of our expenses we have recently cut is our subscription to the NY Times. Previously, we received it 7 times/week for over $50/month (after an attractive intro price). I’ve been wanting to cancel it for a while, but my husband devours the editorial section which one could not access on the internet without a subsription. However, recently they’ve opened up their entire website for free, so we have been able to cut the subscription so the times just comes on Saturday and Sunday (you can’t cancel the Sunday times!).
I have cut down on reoccuring expenses. We now rent movies from the library, we cut down cell phone bills. ( btw instead if calling 411, on cell phines dial 1800-FREE 411. FREE 411 service! You do have to listen to a quick commercial but it says lots of cash. I use to spend $25 a month on just 411!
we have cut ALL magazine subscriptions! It would just clutter my home and made me feel inadequate as a mother, wife and decorator! I even quit my starbuck habit! sniff sniff. The things we do for retirement savings. Sigh
Everyone that’s suggested Pandora is a genius. How could I not have found this before?
your point about cable costs is valid. I find there are only 2 shows a week that I actually enjoy watching and watch regularly. And for that I have to pay upwards of 60$ a month!? Seems stupid to me. I could probably get these shows on itunes or similar web based services for a lot less! And since most computers come with a tv-out connection .. could easily watch these in normal living room situation with little setup.
heck a lot of shows are available for free on the networks website the day after airing anyway. 😀
let see 60*12=720$ that’s enough for a plane ticket a year. i’ll take that instead.
For free music you can’t beat yahoo music. I love it and it’s free. There are some small downsides to the free service, after about 15-20 mins it cuts out (unless you’ve rated a song) and you have to listen to the odd comerical (usually the same one) but no DJ and best of all even in the free service you can rate your songs and skip the ones you don’t like.
First of all, XM Radio is very good… I love the music stations, and the fact that there is CNN and Air America is fantastic. Here’s what I did. I got 3 months free from buying a car with XM installed, and then I called to cancel stating that I didn’t listen enough. They said that they would give me another 3 months to decide if i want to keep it at a 50% discount. At that point it was around $6.50 per month. I accepted it for 3 months, and then did the same a short while later.
I can’t figure out how to get rid of Comcast, however… I have an HDTV and I have become addicted to the DVR services. I am gone during the week for business, so recording the shows in HD is great. I don’t know if I can do away with the service, as much as I hate paying their fees. Why oh why does HDTV have to be so fantastic and expensive?
I try to keep fixed costs to a min each month. They tend to be:
Mortgage
Strata Fees
Rrsp – retirement plan
Cash – Fixed amount of spending money
Telephone
Property tax
Auto Insurance + Fuel
Thats it, the smaller the list the easier life is.
My recurring costs are constantly being reviewed for ways to cut down. I have ONE magazine subscription, and one financial newsletter subscription that I’m going to let lapse because it doesn’t give me anything I can’t get from the online PF community.
I have the minimum possible cable TV, solely because Comcast charges more for internet only. I keep that to a minimum by calling in every time the latest promotion expires and quoting them the last rate quote I got from AT&T. I have a hard limit on the cost of internet service, the day I can’t drop Comcast below that limit is the day I go with whoever else I can find.
My cell phone service is a time block somewhat more than I use in a month, the next block down is less than that, so it is the best balance I can manage.
My home phone is a VoIP service, $25/month for effectively unlimited calling to anywhere I’m likely to call. This is handy for talking to friends in places like Canada or Germany.
Then there are things that are worth the money. I have an on-line storage service that I use to keep encrypted copies of my various electronic records in case of problems at the house.
I am taking an on-line course in Japanese, this is self-paced, no grades or such. This is a course that you take because you want to learn, and even though my usage is uneven, it is there when I have time and I have access to teaching staff for questions. It is worth the $19.95/month for the flexibility. Convenience does have value. Also, this particular expense qualifies both as education and entertainment.
I have recently started a personal battle against subscription fees. It’s just too easy to rack up a bunch of them that really drain your budget.
I agree that we need some, but I find for myself that I get excited about some new thing, subscribe, and then hardly pay attention to it a few months down the road. It is very true that you can cut out a lot of these services and not even miss them.
I am another person who loves XM, when I got my new car it came with 3 free months, I did not plan on subscribing afterwards. At the time I was making a long commute each day (64miles each way) and had to switch radio stations 3 times. I was listening to NPR quite a bit, but then switched to XM.
They offer XMPR which features some NPR programs but not your local. I do not drive as much now but XM is great and find it hard to go back to regular radio which I never listened to very much.
I try to run my finances like I would a business and one of the cardinal rules of business ownership is to attempt to reduce variable expenses.
I would go out of my way to pay for monthly expenses like gym membership and insurance up front if I was getting a discount so that I wouldn’t have the monthly obligation. It’s much harder to budget with a bunch of monthly bills, not to mention the hassle of paying them or keeping track when the charges are applied to accounts.
Great post.
Recurring monthly costs are for the financially illiterate. One can’t do without them entirely, but one must make absolutely sure they are worth the cost and review them periodically to make sure they still are.
I capitalize the cost to compare with other products I might buy. Using a 5% cap rate, 12*$10/5% is $2400, a true lifetime cost for a lifetime benefit. Is it worth it to me? Only a very few are. Would love to have an Tivo HD, but it isn’t offered with a lifetime subscription and it will never be worth what it costs to me.
It was bad enough before the internet with things like gym memberships you never made full use of and subscriptions to magazines you hardly ever read, but now every time you go online you’re constantly finding membership sites and service providers persuading you to part with your money every month.
Also the annoying thing about online memberships if that you often forget about them and end up paying the fees for several months before you get round to cancelling them.
I called XM on Saturday and received 12 months of service for $77. That comes out to about $6.41 a month as opposed to $12.99. I am very pleased!!
My local library sells magazines for 1/4 the cost or less of the reg. price and they always have stacks of New Yorkers. At the other local library, you can check out as many magazines as you want to – no limit. Have you tried your library to see if they carry New Yorker magazine? Worth a phone call.
I don’t know if you are still interested in mmos or not but Perfect World is a great mmo that’s absolutely free. It has great graphics, good missions, etc. The only downside is the English is not as great as it could be.
I also called XM today and said I would need to cancel unless I could get the $77/year plan again. They said fine.
I’ve been making resolutions about cutting costs for quite a while, and then about a year ago started reading personal finance books and blogs. JD, I just had to report that yesterday I cancelled monthly costs of more than $80/month – that’s almost $1,000 per year! I spent a few hours cancelling things (funny how easy it is to subscribe to things, and how long it takes to UN-subscribe), and I felt SO GREAT after!
Thanks as ever for all your wise advice!
I don’t have a lot of money available to me; when I moved, and found that all the cable programs I like were in the most expensive tier, so that I had to pay for everything else, TOO, that was it. It was easy; I could watch TV, or pay my electric bill. No more TV for me! I do have two recurring subscriptions – I guess they’re subscriptions: one is for my Transpass, which I need to get to work, so I’m not cancelling that any time soon; the other is for my gym membership. Every once in a while, something comes up and I don’t go for a month or two, but I’m normally there five days a week, and have been for years, so I don’t consider that a money sink at all, for me.
I think about entertainment costs a different way – even if they are recurring. It helps me to think in terms of entertainment value by cost/hour.
Take World of Warcraft, for example. $15/month isn’t really a bad deal if you compare it to other forms of entertainment. Going to see a movie at the theater would cost you $7 (or more) for 2 hours of entertainment.
If you’re playing even just 6 hours/month of WoW, that’s only $2.50 per hour. Cheaper than renting DVDs, really. If you spend your time playing it instead of watching TV, you could even cut out your cable TV and just play WoW instead.
I don’t actually play WoW. Just using it as an example. I am an avid game player and give myself a monthly budget, whether that is for buying new games or paying subscriptions.