Watch Out For Those Automatic Recurring Charges

Most of the e-commerce subscription based services like Netflix, Hulu, Spotify, satellite radio, credit reporting services, and resume services offer automatic renewals and automated payment processing. You can easily lose track of where your money is going on a monthly basis. We tend to like these payment plans because on-the-surface they appear to be very convenient. Recently, a good friend of mine told me how she reconciled the prior 12 months of banks statements and credit card statements only to find four different automatic payments that were being deducted monthly that were a total surprise. She also learned that for two years she had been paying for two different subscriptions to Netflix.

Online services such as credit services, resume services, and weight control have a tendency to capture you by offering a free trial service that will start billing after 30 days. Be very careful of all services that require you to add your credit card information up front. If it is advertised as free and a credit card number is required to get started, it is almost a 100% guarantee that the fine print discloses how an automated contract begins automatically, once the free trial ends. For example, many credit card services will offer “no annual fees,” but if you look closely at the terms and conditions, higher fees will automatically begin in the second year.

If you find it impossible to keep track of your own subscriptions there are services that you can sign up for that track your subscriptions and enables you to cancel through the service. A few to check out are truebill.com and asktrim.com. According to truebill.com, on an average they have saved their customers $512 a year. At a minimum you should set up automatic reminders on your cell phone or desktop calendar to pre-warn you that a free trial is expiring – allowing you to make a decision about whether you want to continue the service.

I suggest pulling out each of your current monthly billing statements after you read this blog and take a minute to scan through your bills and bank statements to identify these types of charges. These recurring charges are usually charged on the same day of the month so they are easy to spot.

Empyrion Wealth Management (“Empyrion”) is an investment advisor registered with the U.S. Securities and Exchange Commission under the Investment Advisers Act of 1940. Information pertaining to Empyrion’s advisory operations, services and fees is set forth in Empyrion’s current Form ADV Part 2A brochure, copies of which are available upon request at no cost or at www.adviserinfo.sec.gov. The views expressed by the author are the author’s alone and do not necessarily represent the views of Empyrion. The information contained in any third-party resource cited herein is not owned or controlled by Empyrion, and Empyrion does not guarantee the accuracy or reliability of any information that may be found in such resources. Links to any third-party resource are provided as a courtesy for reference only and are not intended to be, and do not act as, an endorsement by Empyrion of the third party or any of its content. The standard information provided in this blog is for general purposes only and should not be construed as, or used as a substitute for, financial, investment or other professional advice. If you have questions regarding your financial situation, you should consult your financial planner or investment advisor.