Money Wasters: Memberships

Memberships–we all seem to get roped into them one way or another. Acting on New Year’s impulses, you may have run out and signed up for the closest gym, only to have your tennis shoes remain in the same dusty closet months later. No need to beat yourself up about it; after all, you had good intentions at the time. However, those good intentions are now eating away at your hard-earned savings. It’s time to bust out your monthly bank statement and take a good, hard look at where your money is going.

Most memberships or subscriptions today are paid off through automatic, electronic monthly payments, making it all too easy to forget about the numerous memberships or subscriptions we may be signed up for. For that reason, it is important to closely evaluate our monthly bank statements in order to be aware of exactly how much of our cash each month is going towards services or programs that we hardly, if ever, take advantage of. Start off by looking over your statement and making a complete list of every program, membership or service you’re currently signed up for. If you can, try to total up how often you use each service in a given month. Now, total up how much money all of these programs cost each month and compare the amount to how much use you’re getting out of them. Be realistic and ask yourself, “Am I getting my money’s worth out of this service?” If the answer is “no,” it’s time to do something about it.

Unfortunately, simply deciding we’re done with a service isn’t always enough to get out of it unscathed. Many programs and memberships have strict rules and regulations regarding cancellations, which could end up costing you a pretty penny. It’s wise to be as familiar with your contract as possible so that you know the consequences you may face when ending your membership. Go over the contract and, if there is an “exit fee,” evaluate whether it is more financially beneficial for you to end it or continue paying the membership.

It is also important to know the laws. Some consumer-protection laws allow you to cancel a membership if you move 25 miles away from an affiliated club or if the club moves more than 10 miles away from you. These laws can vary, so make sure you’re up-to-date on the latest regulations.

If you’re currently debating signing up for a certain membership or subscription, make sure you’re actually getting a deal. If you look over the fine print and notice outrageous cancellation fees and guidelines, consider opting for a month-to-month membership; you may end up paying a higher amount per month, but this method allows you more freedom if and when you want to cancel the membership.

Whether it’s the gym, your favorite magazine, or a local tanning salon, memberships and subscriptions can quickly add up. Take the time to honestly evaluate the necessity, or lack there of, of each service you’ve signed up for. You may be surprised to see how much money you can save yourself each month by eliminating these extraneous expenditures.