A Dollar Here, A Dollar There

by Affinity Consulting Group on July 5, 2018

By Jennifer M. Ramovs, Director of Practice Management, Affinity Consulting Group

My password management program, 1Password, which I heartily recommend, recently released its newest update, version 7. This article will not be about how good 1Password is and why you should own and use a password manager.[1] No, 1Password’s newest release reminded me that we’ve entered fully the world of software subscriptions.

Two related quotes come to mind. First, Mad Magazine once argued, “The only reason a great many American families don’t own an elephant is that they have never been offered an elephant for a dollar down and easy weekly payments.” Second, Senator Everett Dirksen is credited with remarking, “A billion here, a billion there, and pretty soon you’re talking about real money.”[2] We should all feel this way regarding the increasing number of software subscriptions we face.

Gone are the days of buying a piece of software for $50 to $500 and using it for as long as it worked. Everyone steers you towards monthly or annual charges. Microsoft is happiest to sell to Office via Office365 for between $5 and $12.50 per user per month. Adobe prefers you to buy Acrobat Pro DC at $14.99 per user per month. Not to mention Dropbox ($99/year and up) or antivirus/malware protection.

Having recently redone my budget, I was hit with subscription fatigue. The fatigue lead me to soul-search regarding subscriptions. Here are the principles I created to determine whether to utilize a software subscription:

  1. Does the subscription offer sufficient value in a multi-platform environment? We all use at least a computer and a smartphone; perhaps also an iPad. If I pay monthly, the data should be available on every device. The middle tier of Office365 gives you five installations of Office on Mac or PC, as well as full access to the iOS and Android Office apps on five devices, and a terabyte of storage on OneDrive for about $8.50/month. This is a value compared to $500 for a single boxed install of Office. Other services, like Acrobat, have a less clear rationale. Fortunately, you can still get a full license of Acrobat Pro for $450.
  2. Do I use the tool enough to warrant paying the subscription fee? Slash any “feel good” subscriptions immediately. Think of these tools like gym memberships; if you have them but don’t use them, they’re financial dead weight. For example, off the top of my head, I can think of five cross-platform task management apps that charge monthly fees: Wunderlist, ToDoist, Checklist, Remember the Milk, and Any.do. They have free tiers, but advanced features will cost you about $40 per year. If you don’t use the advanced features, drop down to the product’s free tier. If you don’t want to pay a monthly fee, but need advanced features, consider something like OmniFocus or Things, both excellent Mac/iOS task managers, whose Mac and iOS apps together cost about $80. After two years, you’re money ahead compared to subscription software.
  3. What are the cancellation terms and procedures? I try a lot of software in my job. First, nothing is more annoying than cancelling service with a company by calling them on the phone. In 2018. They can start me up with a web form and credit card, but many won’t let me leave that easily. The second cancellation pitfall is that, if you arrange to pay annually, to save money, and cancel partway through the term, you may not get a refund; only access to the service until the expiration date. I am very reluctant to sign up with companies who take these approaches to software subscriptions. If you’re stuck in such a subscription, and you don’t want to cancel immediately, I suggest setting a calendar reminder for two weeks before the renewal date; make it an appointment with yourself to cancel the service.

Hopefully these principles are useful in your own review of your mounting list of software subscriptions, and save some money to boot.

 

 

[1]   Though that would make an excellent column.

[2]  There is some dispute as to whether Senator Dirksen ever said this quote. See https://www.barrypopik.com/index.php/new_york_city/entry/a_billion_here_a_billion_there_pretty_soon_youre_talking_real_money.

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