Retirees Are Canceling These 3 Autopay Bills First
Autopay is a financial trap dressed up as a convenience. You set it and forget it, which sounds great until you realize you're quietly hemorrhaging money on services you forgot you signed up for — or worse, never wanted in the first place.
Retirees are waking up to this reality and opting out. MoneyLion spoke with two financial advisors to uncover which autopay bills retirees are reconsidering first, and the savings might surprise you.
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Cell Phone
According to Josh Glenn, certified financial planner (CFP) and founder of Focused Wealth, a cell phone bill is one of the most common for retirees to drop from autopay. While they aren’t exactly canceling their cell phone plans, Glenn said they’re being more mindful of the services they’re paying for.
In some cases, this includes taking a closer look at family plans, especially if the retirees are the ones footing the entire bill. Savings.com conducted a study that showed of parents who provide financial support to their adult children, 65% help pay cell phone bills.
The exact amount retirees are saving by taking their cell phone plans off autopay varies by person. However, the average cost of bundled wireless services is $145 per month, according to JD Power.
Cable
Another bill retirees aren’t cancelling altogether but are taking off autopay is cable.
"They are slashing services that they never used, but paid for, for years," Glenn said. "They have essentially been paying for premium packages, while using only the most basic services."
In most cases, their adult children are catching onto this and stepping in to help.
"This week I had a 62-year-old client help her 88-year-old mother call the cable company to remove unused packages that saved her $90 per month," Glenn said. That's $1,080 a year — for channels no one was watching.
Subscriptions
Subscription services set to autopay are where retirees lose track fastest.
"Some automatically renew unless you cancel first, which can catch you off guard," said Paul Ferrara, chartered investment manager (CIM) and senior wealth counsellor at Avenue Investment Management. "Sometimes you're signed up for a subscription without even realizing it."
The problem isn’t necessarily one monthly charge. It’s the small fees adding up in the background, because they’re being paid automatically.
According to Ferrara, the specific monthly savings retirees can enjoy by taking subscriptions off autopay will vary according to what’s being cancelled.
“A $10 monthly subscription adds up to $120 over a year,” he said. “If you have five unused subscriptions at that rate, that’s $600 in annual expenses.”
Even subscriptions you want to keep are worth pulling off autopay. This way, you'll catch rate increases before they hit your account and can decide whether to negotiate for a discount or cut the cord entirely.
The Bottom Line
A few minutes spent reviewing your monthly charges could save you hundreds or thousands a year. Start with these three categories, then sweep through everything else hitting your account on a monthly basis. Call the companies, ask questions and remember — just because you can automate something doesn't mean you should.
This article was provided by MoneyLion.com for informational purposes only and should not be construed as financial, legal or tax advice.
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