Saving on Software
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As the holiday season comes closer, that need for cash is greater than ever. Whether it’s getting the right gift for a loved one, or preparing for your COVID conscious gathering, money can feel especially tight, and making sure you budget correctly is more important than ever.
When we try to think of ways we can save, most of us go through the same list of ways we can cut spending on non-essentials. For example, going out to eat less, drinking less or cheaper alcohol, turning off the heat and lowering utilities are all ways people change their lifestyle to save money. While cutting out non-essentials is a great habit to practice, I believe there is a better way to save money (without changing your lifestyle) that is often overlooked.
Saving on software. When people think to save, they rarely think of saving through software, and when they do, they think of cancelling their subscriptions. However, one can easily save on almost all software companies by using their bargaining power and prepaying. Today, almost all consumer oriented software companies (SaaS) will provide a monthly subscription option. While this option provides little commitment to the user, over time a monthly subscription will be more expensive than paying annually. This is because for software companies, cash now is always better than future cash (they can reinvest in the business and it guarantees customer retention). Therefore, unless you plan on only using a software for only a few months, it makes sense to prepay annually for your subscription.
How can you prepay annually? First, many software companies understand the power of annual prepayment, and will offer a flex option of the ability to subscribe monthly for one price or annually for a significant discount. However, what if the company only provides a monthly subscription (etc. Netflix, Xfinity)? There are third party platforms which will leverage annual prepayment for you. Simply pay through the third party platform, and they will immediately provide you with a 30%+ discount for your prepayment. These third party platforms make money by acting as an added marketing source for softwares, so they do not cost you more than going through the software company themself.
Saving money has never been easy and never will be easy. Almost always one has to change their lifestyle negatively in order to stay. However, prepaying for software is one of the few ways one can save without changing their lifestyle at all! So go through those subscriptions, figure out how to annually prepay for them, and get a loved one something nice with the extra cash you have.