Reoccurring costs can be hidden expenses every month which make us poorer

Do you have a buddy who has tons of subscriptions? He pays for Netflix, Hulu, HBO, and has a rock gym membership and Amazon prime? All of those could easily cost the guy $120 or more per month! That’s small car payment with all those subscriptions one could possibly have.

Unfortunately, that’s not all the costs that one could incur by choosing to buy subscriptions. You are also incurring opportunity costs. Opportunity costs are what you could be choosing to spend your money on, in this case, our opportunity cost is investing that money every month into the stock market.

The Calculator

I’ve built a calculator that helps you see these opportunity costs and how much money you would need to maintain that same sticker price every [day, work week (5 days), weekly (7 days), monthly, and yearly]. The calculator works by entering the price of the good in column C, row 4. Updating, from the drop down selection, how often you incur that charge, your hourly wage after tax (or before tax if you don’t know what it is after tax), and your expected investment rate of return – (if you’re not sure leave it at 7% – that’s the long run average return of the global equities market).

So for our example of a person paying monthly subscriptions for Netflix, Hulu, HBO, a rock gym membership, and amazon for around $120 a month, they would need a $36,000 dollar investment which gets a rate of return of 7% per year, to continue that $120 monthly payment indefinitely, at a withdraw rate of 4% per year.

But below the $36,000 in green, it tells you how much you need to work, in order to save $36,000 at your hourly wage. In our hypothetical case, this person is making $20 an hour after taxes so they need to work 1800 hours or 75, 24 hour days in order to earn $36,000. 

It also tells you what the total cost is of the good for each year up to 25 years and pairs that with how many hours you need to work in order to earn that amount of money.

You can access the spreadsheet I made for free on google drive.

Please follow this link.

Please feel free to make a copy and edit it.

Overall, I hope this helps people get a better grasp on how reoccurring costs can be damaging to our wealth building goals. They may seem small, but costs can really add up over time. And the goal is building wealth, not squandering it. Of course, some reoccurring costs are unavoidable like health insurance so don’t feel bad about those, this is simply a helpful illustration on how we could likely cut down on some costs. Cutting costs help us build wealth if we choose to invest those cost savings, and one of the best platforms to invest with is m1 finance (you’ll get an extra $30 dollars with the referral link) it’s a great platform for long term investing. And finally, if you’re looking for further ways to enhance returns check out our high risk and ultra-high risk newsletter.

If you’re a first-time investor, try checking out the easiest portfolios out there . Or if you’re looking to get out of debt, try getting motivated with “The power of Budgeting .”

But best of luck with cutting costs and building wealth!

Note: the m1 referral link gives the reader $10 extra dollars to invest with if they choose to fund a taxable with $100 dollars within 30 days of opening the account or fund an IRA with $500 within 30 days of opening an account. The author of this article will receive a $10 dollar compensation as a result of the reader opening an account. The compensation for both parties occurs 30 days after the deposit occurs and assumes the full amount is retained in the account until the end of 30 days from the deposit day. YNAB offers a free month of use this will be given to both the author and reader if the reader subscribes after the free trial period and buys a month of subscription. The author uses and endorses both YNAB and M1 Finance and both links are affiliate links.

Disclaimer: is not a registered investment, legal, or tax advisor or a broker/dealer. All investment/financial opinions expressed by are from personal research and experience of the owner of the site and are intended as educational material. Although, best efforts are made to ensure all information is accurate, up to date, and reliable, occasionally unintended errors and misprints may occur. The content is intended to be used as informational purposes only. You should take independent financial advice from a professional and independently research any and all of our claims. The website does not accept any liability whatsoever for any loss or damage you may incur.


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