We live in a golden age of entertainment. Gone are the days of waiting a week for a new episode or dealing with endless commercials. Now, we have instant access to an entire universe of content, thanks to streaming services. But what happens when our love for binge-watching turns into a financial drain? Let’s dive into the story of Sarah and her ever-growing list of subscriptions.
Sarah's Streaming Spree
Meet Sarah, a 32-year-old marketing professional living in a cozy apartment in the suburbs. Sarah is what you’d call a streaming connoisseur. Netflix, Hulu, Disney+, HBO Max—you name it, she’s got it. Sarah loves to unwind after a long day with her favorite shows, and who can blame her? After all, there’s something comforting about knowing that every episode of Friends is just a click away.
But here’s the thing: Sarah never really took the time to calculate how much she was spending on her streaming habit. It’s just $10 here, $15 there, right? What’s the big deal?
Well, let’s break it down.
Sarah's Monthly Streaming Expenses:
- Netflix: $15.49 (standard plan)
- Hulu (No Ads): $14.99
- Disney+: $7.99
- HBO Max: $15.99
- Amazon Prime Video: $8.99 (Prime membership)
That’s a total of $63.45 per month just on streaming services. Doesn’t seem too bad, right? But let’s dig deeper.
The Annual Damage
Now, $63.45 a month might not seem like a lot, but over the course of a year, that adds up to $761.40. And remember, these are just the basics. Many people also throw in additional services like Apple TV+, Showtime, or even a YouTube Premium subscription, pushing the total even higher.
But here’s the kicker—Sarah doesn’t watch all these services every month. She subscribed to HBO Max for Game of Thrones, but now that the show’s over, she rarely touches it. Disney+ was for The Mandalorian, but she’s too busy with work to dive into their other offerings. Essentially, Sarah is paying for convenience and the “just in case” factor, not actual usage.
What Sarah Could Do Instead
Here’s where things get interesting. What if Sarah decided to streamline her streaming (pun intended) and invest the difference? Let’s say she cuts her services down to two core subscriptions, say Netflix and Amazon Prime, for a total of $24.48 a month. That frees up $38.97 each month to do something more productive.
Scenario 1: Investing in an Index Fund
Imagine Sarah decides to invest that $38.97 into a low-cost index fund with a historical return of around 7% annually.
- Monthly savings to invest: $38.97
- Annual savings: $38.97 x 12 = $467.64
- Invested over 20 years with a 7% return: $467.64 x [(1 + 0.07)^20 - 1] / 0.07 = $19,963
That’s nearly $20,000 after 20 years, just from cutting out unused subscriptions! And this is without any extra effort beyond clicking a few “cancel subscription” buttons.
Scenario 2: Buying and Staking Crypto
Let’s say Sarah’s a bit more adventurous and decides to put that $38.97 a month into a mix of Bitcoin and Ethereum. And maybe she’s savvy enough to stake her Ethereum to earn some extra rewards.
- Total invested over 5 years: $38.97 x 12 x 5 = $2,338.20
- Potential crypto growth: Let’s be conservative and assume her mixed portfolio doubles in value (which in the crypto world is not unheard of, but not guaranteed). That would bring her total to $4,676.40.
If Sarah’s staking her Ethereum, she could be earning an additional 5-7% annually on top of any price appreciation. Not bad for cutting out a few subscriptions, huh?
Key Takeaways from Sarah's Streaming Saga
Micro Expenses Are Still Expenses: It’s easy to justify small expenses like streaming services because they don’t feel like a lot on their own. But they add up quickly, especially when multiplied across multiple subscriptions.
Evaluate Your Usage: Are you really using everything you’re paying for? If not, it’s time to trim the fat. Stick with what you actually use and enjoy—everything else is just draining your bank account.
Reallocate Wisely: Once you’ve freed up some cash, don’t just let it sit there. Whether you choose to invest in the stock market, crypto, or even start a side hustle, make sure your money is working for you.
Enjoy Responsibly: This isn’t about depriving yourself of joy. It’s about being smart with your resources. Sarah still gets to enjoy her favorite shows, but now she’s also building a financial cushion for her future.
The Big Picture
Sarah’s story might seem like a small potatoes problem, but it’s actually a reflection of a much larger issue that many of us face. We’ve become so accustomed to “set it and forget it” services that we don’t even realize how much money is slipping through our fingers.
But by taking a step back, evaluating our habits, and making a few strategic changes, we can turn those small, forgettable expenses into something meaningful—whether that’s an investment portfolio, a crypto wallet, or just a bigger savings account.
So, what’s your version of Sarah’s streaming spree? Maybe it’s a gym membership you never use, a meal kit service you’re too busy to cook, or even that monthly delivery of fancy coffee you don’t really need. Whatever it is, it’s time to take a closer look and ask yourself if it’s worth it.
Your future self will thank you.
The above references an opinion and is for information purposes only. It is not intended to be investment advice. Seek a duly licensed professional for investment advice.