Keeping your convenience spending under control

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Keeping your convenience spending under control

2019-06-19 23:08 Last Updated At：23:20

Sure it's nice to have your groceries delivered now and then. Ditto dinner. Want to stream your favorite movies? Why not. Curated clothes and books sent to your home? Yes please. But too much convenience can cost you.

"It's very easy for consumers to lose track of what they are purchasing," said Kate Ryan, a director with TIAA Financial Solutions.

There has been a proliferation of subscription services in recent years. Throw in auto-billing and the ease of mobile payments, and you can see how some expenses can fall under a consumer's radar.

About 15% of online shoppers have signed up for one or more subscriptions to receive products on a recurring basis, according to a study released last year by McKinsey & Co. More than half of U.S. consumers streamed video content via subscription last year, according to NPD Group. And nearly 2 billion foodservice deliveries took place for the year that ended in March, according to NPD.

Here are a few tips on how to get a grip on it all.

DO AN AUDIT

If you aren't already tracking your spending, do so. Pay close attention to all the payments you make — recurring or not — and to the forms of payment: credit cards, Venmo, etc.

Don't guess. Research by Waterstone Management Group found that 84% of consumers underestimate how much they spend on subscriptions. Waterstone looked at 2,500 American budgets and found that while consumers estimated they paid almost $80 a month on certain subscriptions, they actually paid closer to $240.

Subscription services are attractive because they're easy to sign up for and come with minimal monthly financial commitment, said researcher Dhaval Moogimane. But small costs can add up, and prices can increase over time.

"I've never worked with someone who after we calculated their expenses is spending less than they thought," said Ryan. However, she said that sticker shock can often be a good call to action.

CONSIDER THE VALUE

It's time to decide if all these costs are worth it.

This is a highly personal decision. Grant McOmie of Portland, Oregon said that he and his wife began to cut back last year to focus on paying down student loans. They decided ridesharing didn't have a spot in their aggressive budget and they ditched Amazon Prime, Netflix and various music streaming services as well.

"Ultimately none of these services were worth it," he said. He estimates that over the past 18 months — through taking the bus instead of Lyft or Uber, or making a meal instead of ordering delivery — they've saved around $5,000.

In some cases, however, convenience can pay off.

Sarah McLaughlin moved to Austin about a year ago and has yet to set foot inside a grocery store. She relies primarily on Instacart for her groceries and estimates she's cut her monthly grocery spending by $200 by curtailing her impulse spending. Instead of picking up extras like magazines, makeup and prepared meals, she buys only what is on her list and is able to use online coupons to maximize her savings.

So calculate what your convenience spending may be a substitute for and which is more costly — Stitchfix versus shopping at the mall, for example; or Hulu and Netflix versus cable.

Consider other benefits too: A time-starved parent may be thrilled to pay extra for food delivery. A pricey at-home workout subscription might be worth it to a fitness junkie. While these types of services sometimes get a bad rap, experts say many people are happy with the benefits they get.

So how can you decide the value (financial and otherwise) for yourself? Utpal Dholakia, a professor of marketing at Rice University, has a simple suggestion. Ask yourself: If I didn't have this service today, would I buy it again? If no, toss it. If yes, keep it and enjoy.

Still not sure? Then consider whether you would pay cash each time these charges occurred.

There's plenty of research to show that a consumer is likely to spend more if they use a credit card, versus the inconvenience that comes with paying cash. Companies have made paying for these services and products nearly frictionless. So ask yourself whether you would hand over $50 cash for that last Uber ride or peel off a Ben Franklin every month for barre classes and see how that feels.

MAKE CHANGE

There are some actions you can consider to adjust your habits:

— If you know you are ready to ditch something, unsubscribe or delete your account. Be prepared — they will try to lure you back.

— Add some friction. Even small steps to make payments less easy may curb your spending, such as eliminating auto billing or deleting an app on your phone.

— Put all your subscription or convenience spending on one card to better monitor it, Moogimane suggests. Or try his more draconian suggestion: Cancel your credit card, forcing you to only update billing for the services you truly want.

— Set an alternative goal. If there is something you want, such as money for a car or a down payment on a house, remember that when you are tempted to make a purchase. That can help keep your spending focused.

— Go on vacation or do something else to disrupt your life. Dholakia says research shows the best way to break a habit is to change the context in which the habit was developed. So if you get meal kits each week, a vacation may change your routines and help shake your reliance on them. In the end, it all comes down to you.

"You have to be in charge of saying this is something I am not enjoying or using," Dholakia said. "You can't have someone else do it for you."

Venice tests a 5-euro entry fee for day-trippers as the Italian city grapples with overtourism

2024-04-26 00:14 Last Updated At：00:20

VENICE, Italy (AP) — Under the gaze of the world’s media, the fragile lagoon city of Venice launched a pilot program Thursday to charge day-trippers a 5-euro ($5.35) entry fee that authorities hope will discourage visitors from arriving on peak days and make the city more livable for its dwindling residents.

Visitors arriving at Venice's main train station were greeted with large signs listing the 29 dates through July of the plan's test phase that also designated separate entrances for tourists, and residents, students and workers.

“We need to find a new balance between the tourists and residents,’’ said Simone Venturini, the city’s top tourism official. “We need to safeguard the spaces of the residents, of course, and we need to discourage the arrival of day-trippers on some particular days.”

Not all residents, however, are persuaded of the efficacy of the new system in dissuading mass tourism, insisting that only a resurgence in the population will restore balance to a city where narrow alleyways and water buses are often clogged with tourists.

Hundreds of Venetians protested against the program, marching festively though the city's main bus terminal behind banners reading “No to Tickets, Yes to Services and Housing.” Protesters scuffled briefly with police with riot gear who blocked them from entering the city, before changing course and entering over another bridge escorted by plainclothes police officers. The demonstration wrapped up peacefully in a piazza.

Tourists arriving at the main station encountered almost as many journalists as stewards on hand to politely guide anyone unaware of the new requirements through the process of downloading the QR code to pay the fee.

Arianna Cecilia, a tourist from Rome visiting Venice for the first time, said she thought it was “strange” to have to pay to enter a city in her native country, and be funneled through separate entrance ways for tourists. She and her boyfriend were staying in nearby Treviso, and so downloaded the QR code as required. But she was still caught off-guard while soaking in her first view ever of Venice's canals by the sight of the entrance signs and her boyfriend telling her to get out the ticket.

On the other side of the entrance ways, workers in yellow vests carried out random checks at the train station. Transgressors face fines of 50 to 300 euros ($53 to $320), but officials said “common sense” was being applied for the launch.

The requirement applies only for people arriving between 8:30 a.m. and 4 p.m. Outside of those hours, access is free and unchecked.

Venice has long suffered under the pressure of overtourism, and officials hope that the pilot project can help provide more exact figures to better manage the phenomenon.

The city can track the number of hotel visitors, which last year numbered 4.6 million and is down 16% from pre-pandemic highs. But the number of day visitors, which make up the majority of the crowds in Venice, could only be estimated until recently.

A Smart Control Room set up during the pandemic has been tracking arrivals from cellphone data, roughly confirming pre-pandemic estimates of 25 million to 30 million arrivals a year, said Michele Zuin, the city’s top economic official. That includes both day-trippers and overnight guests.

But Zuin said the data is incomplete.

“It’s clear we will get more reliable data from the contribution” being paid by day-trippers, he said.

Venturini said the city is strained when the number of day-trippers reaches 30,000 to 40,000. On peak days, local police set up one-way traffic for pedestrians to keep the crowds moving.

Residents opposing the day-tripper tax insist that the solution to Venice's woes are to boost the resident population and the services they need, limiting short-term rentals to make available more housing and attract families back from the mainland.

Last year, Venice passed a telling milestone when the number of tourist beds exceeded for the first time the number of official residents, which is now below 50,000 in the historic center with its picturesque canals.

“Putting a ticket to enter a city will not decrease not even by one single unit the number of visitors that are coming,’’ said Tommaso Cacciari, an activist who organized a protest Thursday against the measure.

“You pay a ticket to take the metro, to go to a museum, an amusement park. You don’t pay a ticket to enter a city. This is the last symbolic step of a project of an idea of this municipal administration to kick residents out of Venice,” he said.

Venice Mayor Luigi Brugnaro declared the launch day, coinciding with an Italian holiday, a success, registering 15,700 paying visitors, 50% more than anticipated.

More than 97,000 others had downloaded a QR code denoting an exemption, including to work in Venice or as a resident of the Veneto region. Hotels in Venice, including in mainland districts like Marghera or Mestre, provided a QR code for visitors to attest to their stay, which includes a hotel tax — accounting for 40,000 of those.

Venturini, the tourist official, said that interest in Venice’s pilot program has been keen from other places suffering from mass tourism, including other Italian art cities, and municipalities abroad such as Barcelona, Spain, and Amsterdam.

But Marina Rodino, who has lived in Venice for 30 years, doesn't see the fee as the cure-all. Neighboring apartments in her residential building near the famed Rialto Bridge once inhabited by families are now short-term apartment rentals.

The corner butcher shop closed. Yet she noted that the new entrance fee requirement will still allow young people to flood the city in the evening for the traditional aperitivo, which can grow rowdy.

She was passing out mock European Union passports for “Venice, Open City,” underlining the irony of the new system, and challenging its legal standing with citations from the Italian Constitution guaranteeing its citizens the right to “move or reside freely in any part of the national territory."

“This is not a natural oasis. This is not a museum. It is not Pompeii. It is a city, where we need to fight so the houses are inhabited by families, and stores reopen. That is what would counter this wild tourism,’’ Rodino said.