Subscriptions are a way of paying for something. Usually, you make regular payments for a service or goods. Like paying once a month for a magazine or your movie streaming service. You don't need to keep ordering the same goods and services as it all happens automatically.

Subscriptions have been around for many years, from newspapers to weekly milk deliveries. Now there's even more to subscribe to, thanks to a wealth of online goods and services. This can be a real time-saver, but the costs can soon grow. 

In this lesson, you'll learn more about subscriptions. You'll find out what they are, how to set them up and use them, plus tips to keep on top of them.

KEY LEARNINGS

  • What a subscription is
  • The common types
  • How to manage your subscriptions
  • Your choices when a subscription ends

Read time:

23 mins

Chapter 1

What are subscriptions?

Read time:

4 mins

How do subscriptions work?

Subscriptions let you receive goods or a service regularly without having to re-order it every time.

How often you pay will vary. Some offer monthly payments. Others ask you to pay every 3, 6 or 12 months. There are even some where you pay the total cost upfront. 

There are also different ways to pay. Each provider will make it clear which options they offer and what you’ll get for your money. 

For each subscription you take out, you’ll find some terms and conditions. These tell you things like the contract length, how to cancel, the payment terms and any usage limits. So, do make sure you read these and check they work for you before you sign up.

 

Why should you check your subscriptions?

Subscriptions can save you time, but their costs can add up. There’s a chance you may end up paying for things you no longer need. It's always worth reviewing your subscriptions. Check to see if you still use them and that they're value for money.

Did you know:

The UK spends an estimated £20 billion a year on subscription services

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42 million adults (79%) in the UK have at least one subscription service

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The average person spends £500 a year on subscription services

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The benefits

  • Easy delivery – You may be able to save time and effort. Have your goods delivered to you without having to re-order
  • Flexibility – You may be able to stop at any time. Always check this, before you sign up
  • No upfront charges – Many subscriptions don't charge any upfront payments, which can make budgeting easier

 

Things to think about

  • The costs  – If you take on subscriptions for many different things, these can add up. It can also become harder to keep track
  • Usage – Over time, you may find you use the service less - or even not at all
  • Changes  – With time, prices change and services can too. So it's good to check and shop around, especially at renewal time

If you’re midway through your subscription, it may be hard to make changes or cancel – or you may need to pay a fee. Read the terms and conditions carefully, so you know what to expect.

Chapter 2

Types of subscriptions

Read time:

3 mins

What are some of the common types?

  • This type offers a set price for a fixed product or service. Like paying £4 a month to receive the same monthly magazine.

  • This offers a set price for unlimited access to a good or service. This would be something like a gym membership. You pay £15 a month and can go to the gym as many times as you like as long as you are subscribed.

  • Pay-as-you-go lets you pay for goods and services periodically without any long-term commitment. You can cancel your subscription at any time. This is common for beauty boxes and similar services. This is where you pay monthly and in return receive a monthly delivery of beauty products.

  • You may have heard of 'freemium' packages. They offer limited access to content or services, for free. If you want extra features, you can pay to subscribe. One example is music streaming services. These give you options to listen ad-free or offline, for a charge. 

Did you know?

The UK population spends over £2 billion every year on subscription services. 

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What can you subscribe to?

Here are a few examples:

  • Entertainment – TV, movies, music and games
  • Other online services – Language and other learning platforms plus news services
  • Food and drink – Fruit and veg boxes, meal kits, coffee and wine
  • Charity membership – Annual membership may include regular magazines and member-only offers
  • Gym and wellness memberships – From online fitness classes to sessions at your local sports centre
  • Gift subscriptions – Receive a different item or selection each month, from flowers to cheese!

Chapter 3

Starting a subscription

Read time:

2 mins

Where do you start?

Often, the provider’s app or website is a good place to start. You’ll see information there about what's included and how to subscribe. The details will vary, from site to site. So, always check the instructions – and those all-important terms and conditions.

 

Let's look at the general steps involved:

Chapter 4

Managing your subscriptions

Read time:

7 mins

How will I pay?

Some subscription services let you choose your payment method. Others will have a preference.

Common payment methods include:

  • Direct debit – This lets the company take payments from your bank account during the term of your subscription
  • Debit or credit card – This option works for both one-off and regular subscription payments
  • Cash – Not a common choice, but some clubs and societies let you pay by cash
  • Online bank payment – This could be a one-time payment for the whole term of your subscription
  • Standing order – If you want regular payments to come from your bank account, this may be an option

 

How often will I pay?

Again, this will depend on the subscriptions.

These are the likely options:

Single payment

An upfront payment to cover the whole period of your subscription.

Monthly payments

Pay something each month throughout the subscription.

Other payment intervals

These could be every 3 or 6 months, or once a year.

Where to review your subscriptions

Your bank

  • Check your bank statement for details of payments made
  • Most banks have a spending overview in their banking apps
  • Some banks also have a section to view all subscriptions in one place

Apps

  • Some apps track and manage your subscriptions for you
  • Others can remind you about renewals that are coming up
  • Note that these apps may charge for this service

It's a good idea to review your subscriptions regularly. This helps you keep track of your outgoings. It can also help you decide whether you want to continue or cancel.

Chapter 5

Renewing and cancelling

Read time:

7 mins

Renewing your subscriptions

So what happens at the end of a subscription period? It often depends on the terms and what you've agreed.

Some subscriptions are set to 'auto-renew'. In this case, your provider will contact you before the end of your contract term. They'll let you know the date and cost of the renewal and explain how to stop the renewal if you want to.

Not all subscriptions automatically renew at the end of the contract. The providers may still get in touch, inviting you to renew. They'll give you details on how to do this. The process will be similar to when you first took out the subscription.

 

Cancelling your subscriptions

 

 

Want to cancel before your subscription ends?

If you're midway through the term of the subscription, check your terms and conditions. There may be fees to pay if you cancel early.

For some subscriptions, there may be an option to freeze or pause. This lets you stop the service for a set period, instead of stopping it completely. You can choose how long you freeze or pause it. At the end of this time, you'll be expected to resume payments.

 

How to cancel

Always check your terms and conditions. Contact the provider to cancel the subscription. If you've signed up and paid for a service through an app, you may be able to cancel through the same app. For online subscriptions, you may need to log in and check your account details to see how to cancel.

When you cancel a subscription, this should automatically cancel any future Direct Debit payments for it. It's best to always cancel these yourself. You can use your banking app or contact your bank to do this. Do check that the subscription contract has ended before you cancel any regular payment methods.

Always check that your provider has confirmed the subscription cancellation, before you cancel any payment methods.

Top tips to manage your subscriptions

  • Always check the terms and conditions before subscribing
  • Take advantage of free trials – just make a note of when they end
  • Shop around for better deals
  • Check any messages about subscription changes or renewals
  • Review your subscriptions regularly
  • Cancel what you don't need or use

 

Bank of Scotland Academy is committed to providing information in a way that is accessible and useful for our users. This information, however, is not in any way intended to amount to authority or advice on which reliance should be placed. You should seek professional advice as appropriate and required. Any sites, products or services named in this module are just examples of what's available. Bank of Scotland does not endorse the services they provide. The information in this module was last updated on 9th October 2024.