Sage advice from an old man
In continuing with my Vegas inspired blogs, I am taking this Music Monday to highlight The Gambler by Kenny Rogers. The video below is cheesy and the song is 35 years old, yet it has some of the most sage advice I have ever heard. In the song, a down on his luck train passenger gets lessons on playing cards from a seasoned gambler, but we all know that his advice goes beyond the card table.
The gambler is truly providing us with important life lessons. From a financial standpoint, I would like to highlight the chorus “You gotta know when to hold ‘em, know when to fold ‘em, know when to walk away, know when to run.” And these words are incredibly important when looking at recurring payments we have on our credit or debit cards. These payments could include anything from gym memberships or cable/satellite bills to magazine subscriptions or website access.
Recurring payments add up
Recurring payments are sneaky charges that have larger implications. $19.99 per month might not seem like a lot of money, but $240 for the year could definitely make a difference in your financial health. When I meet with clients who have difficulty saving, we review their credit and bank account statements in great detail and analyze the true value of these recurring payments. Do you use the service you are paying for? If so, how frequently? Has it been months since you have used it? If you are not benefiting from these payments, then you need to “fold ‘em” and walk away.
I understand that it is sometimes difficult to let go of these because you always think you will use them at some point. However, if you are not using them with any frequency, then your money is best spent saved or utilized on something else more useful. Recurring payments are like STD’s, they are relatively easy to acquire, but seemingly impossible to get rid of, especially in the case of gym memberships.
I advise clients to review these charges monthly and set aside time to call or email the company directly so that you can ensure that you have cancelled any that are of no use to you now. Even if it may be difficult to cancel, your money and financial health is worth your time to make sure you are not overpaying for something you are under-using or not using at all.
Remember the wise words of the Gambler “The secret to survival is knowing what to throw away and knowing what to keep.” Some of these recurring charges may be beneficial to you, but you should commit to analyzing them on an ongoing basis and know when to walk away if they aren’t worth it. Don’t let them quietly hurt you one month at a time.