Save Money by Not Renewing Immediately

Here's a comment I recently received on my post titled Warehouse Clubs Are Worth the Annual Fee:

You can reduce the cost of your membership fee 8% for every month you can go between shopping trips. Say your membership is up Dec 31. You can stock up on Dec 30 for the next 3 months. Then you can renew in March and it won't be up until the following March. You essentially got 3 months free.

I have been thinking about this idea for quite some time -- ever since I received an update to renew our membership to a local botanical gardens. I started thinking that they don't give me any price advantage for renewing early and no benefit for being a long-term member -- I can walk in and get the same deal at the door. Since I only go to the gardens once a quarter or so, why don't I let the membership expire and renew only when I want to go again.

For example, our current membership expires in June. But we regularly visit in March, May, September, and November. If I renew now, I'm paying for June, July, and August, and I have no plans to attend during that time. In other words, I'm paying for three months that I'm not going to use. But if I let the membership expire in June, then buy a new one when I visit in September, then I've "saved" myself three months and now have a membership good until September 2009. If I'm really clever, I could visit the gardens on September 20 this year, then make my September visit for next year sometime before the 20th. At that point, I wouldn't have to renew my membership until December 2009.

I realize that I'm not really "saving" anything because, after all, I have roughly three months between each visit, but I think you get the idea. (For me, maybe it's a better deal simply to pay the per visit costs versus a membership fee.) If you do have something that you use infrequently but could change your habits a bit and extend your membership (like the Costco example above), why wouldn't you? There's no downside is there?

Comments

[Joe]

I have been thinking same thing for car inspection. Here in NY state, regardless of day annual inspection is done, the sticker expires at the end of same month following year. So, if the inspection sticker says you need inspection for December 2008, wait until January 1 (or following day when inspection station is open) and get the car inspected. That way, you will get a sticker that says you need inspection done by Jan 31, 2010, instead of December 2009. You will not get a ticker unless car is parked on public streets or you get pulled over for something so you are taking a small risk but I think taking a risk for a day or two for a month's fee may be well worth taking.

[Kevin]

You're still paying for an annual membership though, correct? They don't pro-rate the fee so I don't see how that's saving any money. Your title should say "Deferring costs" instead of "Save Money".

Aren't the botanical gardens considered a charitable donation anyway (at least part of the fee)?

[Blaine Moore]

Just be careful to pay attention when you renew - I did that with BJ's a year or so ago and didn't renew right away. When I did go to renew, they handed me a card that was only good for 10 months instead of the 12 I paid for because they made it retroactive for when my old membership expired. (I raised a stink and got the 2 months back but it took some effort and going over the local person's head in order to make it happen.)

Now I just get a brand new membership and don't tell them I used to be a member. Problem solved.

[costco member]

I tried this with Costco before - they gave it to me the first time, but after that, even when I waited a few months, they retro'd my membership back to my annual due date. I also raised a stink, but they said they would only waive it once and they already did that for me before. It never hurts to try, and YMMV, but they have already thought this one through there. However, with magazine subscriptions, newspapers, etc, I agree with the thought process.

[LC]

@Kevin - I guess it doesn't matter what you call it. Sure, your membership fee isn't discounted, but over the course of, say, 4 years, you have gotten 12 months free, so you saved 25% on your membership fees during that time. That is assuming that they let you do it.

[Tim]

Watch out for initiation fees too. There's none on a renewal but you can get stuck with one if by lapsing you are considered a new member.