Subscription Boxes: Money Saver or Money Pit?
by Amanda Finn
While a subscription box can save you a lot of time—and can also save you a lot of money—you need to make sure that they’re really worth their cost.
It seems everything comes in the form of a subscription box these days, from dog toys to makeup to beef jerky and even carnivorous plants. While they all claim to save you time, money or both in curating the perfect selection for your customer palette, are you really saving money by subscribing?
According to Take Charge America (@tcasolutions) there are currently over 2,000 different subscription boxes to choose from, and each of those boxes is going to claim that they save you a different amount of money. Some beauty boxes, for example, can run $39.99 and curate an average collection worth around $300. But are you really saving $260 by subscribing?
It’s all in the box.
Depending on what kinds of subscriptions you’re on the hunt for, it is possible to save money on certain things. For example, if you are buying boxes for products you’re already using or interested in trying you might be able to save some dollars. That might not be true for the couponers in the room, however, since you may be better off clipping coupons than relying on the subscription box method.
Take Charge America has a few ways of knowing that you’ll save money through the more basic kinds of subscription boxes (like shaving, household or toiletry products):
You can budget accurately because you know exactly how much you’re spending each month
You’ll always have the basics on hand so you won’t have to make extra trips to the store
Because these companies cut out the middle man, you receive high-quality goods for less
Subscription boxes are also a great way to try before you buy. Often in the case of cosmetic or toiletry boxes, the items you receive are sample or trial sizes. That way you know after trying them if it’s worth your hard earned money to buy the full-sized products the next time you need them. After all, that $300 in cosmetics adds up fast.
For pickier shoppers or even those who loathe the very idea of going shopping, subscription boxes can be a major blessing. Not only are you receiving items you don’t have to look for, but they are specially curated to what the company believes you are most likely to want.
Those handpicked items are also, depending on the subscription box style, a surprise when you receive your box. And when it comes to the popularity of subscription boxes, some people love being able to expect the unexpected.
On this point, The Nest (@TheNest) cited consumer behavior expert Michael McCall who described “the thrill of wondering what you’ll receive in the mail each month.” It can almost feel like a holiday getting the chance to open a gift you sent yourself and not quite knowing what the month’s goodies will be.
However, The Nest also quoted McCall on the flip side of this what’s-behind-door number-three type of pleasure: After a couple of rounds of getting items you don’t like, you may lose interest.”
Back to the buying board
While it’s fun to get a box of fun items every month, for many it might be a drawback that you don’t really know what you’re getting. The fact that you don’t get to actually pick what you’re receiving means that you could be paying for a bunch of stuff you don’t actually need.
While you can squirrel away some of those things for future gifts (and thus still saving yourself some money) consistently receiving items you don’t want is one reason people break up with subscription boxes.
Less Debt More Wine (@LessDebtMoWine) sees subscription boxes as a good thing for those who know what they want and are careful with their spending. However, reckless spenders should beware because subscription boxes aren’t going to help with that particular problem.
“Just remember, it’s about cost value and what you can afford,” Liz of Less Debt More Wine said. “So don’t get caught up in the idea of treating yourself just because you’ve been good in every other aspect of your finances. If it’s not something you can afford or something that really adds value to your life, ideally both, then it’s not going to be worth it.”
It’s also important to be aware of what it is you are getting. A downside of subscription boxes is that you are taking the company’s word for what the box contents are worth. Unfortunately, the individual items don’t usually come with prices on them so it’s difficult to know if what you’re getting is truly the deal you think you’re getting.
Over at the Nest, McCall compared subscription boxes to gym memberships: If the cost is low enough, consumers will see these boxes as a good deal—even when they aren’t getting much actual value from them. The more clear-eyed you can be when examining your own subscription box experience, the more likely you’ll be to make the right call.
Be a smart box shopper
Just like every subscription box doesn’t fit every individual person, the differentiation between want and need isn’t one-size-fits-all either. You have to take your personal spending, household needs, and lifestyle into consideration when deciding to take on a subscription box or not.
The Nest relayed advice from Certified Financial Planner™ Katie Colman, who recommended that people interrogate why it is they are using a subscription box service: “If you’re constantly strapped for time and don’t always make it to the grocery store for dinner goods, then it might be fun—and make financial sense—to enroll in a food-and-recipe delivery program like Blue Apron or Plated.”
And for folks who weren’t subscribing to subscription boxes to save time, Colman recommended doing a deep-dive to examine their subscriptions cost-effectiveness: “Spending $19 a month on a BarkBox subscription may seem like a great deal on the surface, but could you otherwise justify spending more than $200 annually on treats, toys and grooming products for your dog??
While there isn’t a perfect solution out there, a basic cost-benefit analysis should let you know whether or not your subscription box is a clever lifehack or an expensive luxury that you’d be better off without. To learn more about saving money on everyday expenses, check out these related posts and articles from OppLoans:
- Save Money This Summer by Saving Energy
- Save a Few Bucks on Fido with These DIY Pet Toys
- Reusable Purchases That Will Save You Money in the Long Run
- How to Use the Library to Save Money