Perhaps I should file this under “obvious, ” but canceling “zombie” charges — i.e., charges for services or subscriptions that you no longer use — is a great way to save money. If you’re not already doing so, get in the habit of reviewing your credit (or debit) card statements to find “zombie” charges that you’ve long since forgotten.
Here are a couple of quick examples…
Canceling Consumer Reports
About five years ago, when we moved into our current house, we signed up for an online subscription to Consumer Reports. At the time, we were planning on buying multiple big ticket items over the coming year, so we signed up for the “auto-renewing” annual subscription for around $25/year instead of paying $5/month for access.
Of course, I planned on canceling the subscription when we were done with it, but I never go around to it. Fast forward to now… We’re still signed up. Or at least we were until I clicked the button to cancel our subscription over the weekend. To be fair, we’ve used it several times since we signed up, but not in the past year or two, so we’ve wasted a decent amount of money on this.
Subtracting Hulu Plus
Also, over this past summer, I signed up for Hulu Plus to see what all the fuss was about. We have a Roku player, and I was drawn to the idea of being able to stream shows to our TV. On top of that, Netflix was in the process of jacking up their prices, so I wanted to check out the alternatives.
Well, guess what? We hardly watch it. And yet, we’re still signed up for it. Part of the problem is that I really like the idea of this service, even if we don’t use it enough to make it worth the $8/month fee. Thus, I’ve hung onto the subscription for a few months thinking… Hmmm, I’m not sure what I was thinking. That we’d eventually start using it, I guess.
The thing is, it’s dead easy to sign back up, so there’s no real risk to canceling. If I have second thoughts, I can just log back in and sign up again. As of now, we’re no longer Hulu Plus subscribers.
And there you have it… Two quick examples of zombie spending that were costing us over $120/year. If you want to avoid this sort of thing, all you need to do is pay close(r) attention to your bills and (this is the important part) take action when a charge pops up for something that you don’t really use.
Going forward, it’s probably not a bad idea to set an automated reminder to re-evaluate whatever it is that you just signed up for.
What about you? Do you have any examples of zombie that have been draining money out of your pocket? If so, please share them in the comments.
P.S. Yes, I know that you can access Consumer Reports online through many (but not all) libraries.
@Leonard… come into the 21st century, man. Paper = dead trees, higher costs, time, mailing costs, more crap to file.
In my particular case, working at a US Embassy overseas, where it takes 2-3 weeks for mail to arrive, if I didn’t check things online or automate my payments, my payments would frequently be late.
Furthermore, because we move every 2-4 years, I don’t want to lug that paper around with me. I’ve slowly been digitizing all my records, keeping a backup in my bank’s safety deposit box.
So I trust the system, but verify it, checking my bank account at least once a week and my other various accounts (credit, brokerage, &c.) at least once a month.
@Leonard…..I understand manually writing checks forces you to monitor things, but every check you write exposes your checking account number to the merchant (who may or may not be trustworty) and to anyone that may come into contact with your mail. Bad, bad idea. If you need to, go online and manually pay each bill with a cc each month (eg. phone bill, etc).
One of the main reasons why I do not opt for automatic payment system is to monitor my bills and expenses. Paying for something we are not using is definitely a waste of money so we should always check our subscriptions, etc.
… ” Always sign the checks yourself ! ”
That’s an old bedrock rule of personal finance, from long before computers & automatic billpay — but it’s still good advice. Signing the checks yourself for snailmail delivery (or ‘manually’ paying bills online) … forces you monitor the actual outgo from your bank account.
Trusting anyone else (or a computer system) with direct access to your money — is always risky. Countless wealthy celebrities have been bankrupted by crooked/foolish accountants, agents, spouses, parents, siblings, etc — who they trusted to pay their bills, with open access to bank accounts. It’s even worse for average income people.
Convenience is nice, but there are hidden costs. Canceling specific automatic-billpaying accounts is often difficult. They have direct access to your bank account/credit-card … and can keep getting your money, no matter what you said about canceling your account with them. “Introductory” rates & accounts are the worst.
Interesting to see if ConsumerReports actually stops tapping your credit card. A while back, I had great difficulty canceling a ConsumerReports magazine subscription — they kept billing me no matter what I said or did to cancel the subscription; after many months of that, I wrote a letter directly to the Editor of the magazine…explaining my ‘consumer’ problem — that worked, finally.
This is why I always use a “virtual” credit card # on these things (Citibank and BofA have them). I generate a specific credit cc # for each vendor and put a limit on the amount that can be charged, so even if I forget to cancel the credit card charge will be declined.
Works for me.