The small, seemingly harmless monthly expenses can collect significant amounts that seriously affect the personal budget, draw the attention of the experts. We discussed with financial analysts, psychologists and digitization specialists to understand how we lose money without realizing and what we can do, concretely, to identify unnecessary payments and regain control over the personal budget.
The cost of digital comfort
They all argue, in unison, that significant financial losses do not come from the big expenses, but from the small, recurrent ones, which we get to ignore. And the first step for a healthy budget is an overview of what we pay.
For example, at present, people tend to have more and more renewal subscriptions and the most common include streaming video and music (Netflix, HBO Max, Spotify, Voyo etc.)mobile applications (fitness, meditation, foreign languages, premium games, etc.) or cloud services and software (Google One, iCloud, Dropbox, Adobe Subscriptions, Antiviruși, VPN, etc.). These automatic payments, started with a simple “Free Trial”they can sometimes create real holes in the budget. Only five subscriptions of 25 lei each/month means 125 lei. In one year, we are talking about 1,500 lei. Enough to buy a new phone, a low-cost city-break or add them to a savings account.
Digital comfort
“There are no extensive statistics in Romania, opposite the subscriptions and how much they pay for them. In general, this kind of subscriptions represent what I call financial mosquitoes. That is, there are small and frequent expenses, which people tend to ignore or neglect, precisely because it is about small amounts. which are gathering can be very consistent ”explains Adrian Asoltanie, a financial education specialist.
In his opinion, one of the biggest mistakes that people make today is to automate their expenses, without doing so for saving. “You can set an automatic payment on the salary day, for example, you transfer 300 lei to a savings account. In fact, you can automatically invest. That is, you set the amount of 100 lei to reach an investment fund. Most people only automate the expenses, not the saving. Entrepreneur or as a businessman, one of the best strategies is to take your products to the subscription area. he shows.
Optimism has a price
Psychologists explain the phenomenon through a combination of factors: small amounts, automatic payments, lack of action. It is not just about comfort, but about postponed decisions. Many users keep subscriptions that they no longer use from the belief that “at one point” will use applications. The monthly payment becomes a kind of promise, not towards the supplier, but towards itself. In reality, each month costs, and this type of repetitive consumption comes to create real long -term losses. “Most of the time we subscribe to various sites in the desire for relaxation. But when we get to not use them and pay them for nothing, but we do not disable them either because we forgot, or because we postpone, it is clear that this behavior hides the filling of an emotional void. A desire for perfectionism that paralyzes any type of action.is of the opinion of Luminița Tăbăran, clinical psychologist.
For his part, Laura Găvan, a psychotherapist, says we tend to ignore online payments for several reasons. “On the one hand, the modest and invisible amount. On the other hand, the procrastination and the insignificant cost invested. The small amounts, paid online, not with physical money, are not taken into account in the long term and do not give us the impression that we would empty our wallet. At the same time, it gives us psychological comfort as we have taken an action in the sense of a problem, although it is not actually resolved”, Shows the psychotherapist.
According to him, the postponement of the cessation of a subscription that we do not use, gives us the illusion that we will once start sports, that we will start meditations or that we will relax, at one point, watching movies or listening to music. “It is a kind of … deferred hope, but which is there. The fact that the price is low, makes us not give up and overstrate the investment. This, however, is a mechanism that in the long term, produces higher costs. It is desirable to stop the low but constant costs and to orient ourselves to actions that you really want to take course.”completes Laura Găvan, a psychotherapist.
The traps of small expenses
The most common tactical encountered that digital applications or platforms use is to condition their use by entering the card to start a free test. This is one of the major factors that contribute to the monthly financial waste of the user, is the opinion of Cristian Ionescu, an entrepreneur in IT and the founder of a digital startup. “Although, from a legal and commercial point of view, it is the right of the company to decide the terms of access to its product, especially in the conditions in which it offers a temporary free service, this strategy begins to be less and less appreciated by the financially educated persons.” he says.
More and more people, he adds, prefers to use products that offer access to digital products, without the obligation to introduce the card, and the public pressure forces part of the industry to rethink this model. “At the end of the day, companies should rely on their retention on the real value they deliver, not on the fact that sometimes, customers forget to turn off their subscriptions,” explains the expert.
Many users believe that financial problems would only be solved if they earned more. In reality, without careful control of the expenses, the additional income disappear as easily. “The first step is the optimization. You make the budget quickly, and the benefits are seen from the next month.”emphasizes Adrian Asoltanie.
The same mechanism is seen in public budgets, he adds, where the additional money does not repair the imbalances if the small losses are not controlled. “The little ones matter because they are frequent and, then, any optimizae is important. We ignore them because they are relatively small and, when you automated them, you forgot about them and you do not know what you pay,” Complete Asoltania.
So, not what you pay once affects your budget, but what you pay without knowing. Automation of expenses EO dangerous comfort, if not doubled by clarity.
