The streaming services most friendly to financially stressed households are Amazon Prime, Spotify, Youtube and CBC Gem.
All have done something you rarely see in today’s world – they have kept cost increases in recent years below the rate of inflation. Apple TV has exceeded inflation the most, followed by Crave and Disney+. Netflix lies right in the middle, according to data put together by Charles St-Arnaud, chief economist for Credit Union Central Alberta.
The high cost of living these days means more households will be rationalizing the collection of streaming services acquired in recent years. By all means keep the services you use a lot and ditch those that rarely offer anything worth watching. But you might also want to consider whether a streaming service has a history of price increases.
Mr. St-Arnaud started with a Globe and Mail infographic that compared the cost of 10 different services today versus the original price. He then computed the annualized price increases for each since launch with changes in the inflation rate. “On average, the cost of the main video streaming platform is rising at about 3.5 times faster than inflation,” he said in an e-mail. “The consolation for consumers is that music streaming services have seen price increases below inflation.”
Apple TV started at a low cost of $5.99 in 2019 and since then has increased to $12.99, according to the Globe data. Mr. St-Arnaud calculated the annualized increase at 21.3 per cent, top among the 10 streaming services examined. The streaming services that held off inflation the best were Spotify Premium, which has gone from $10 in 2014 to $10.99, and Youtube Music Premium, which has stayed at $9.99.
One lesson from this data is that there’s enough demand for streaming services to support steady price increases. Mr. St-Arnaud calculated that the cost of video streaming is rising about 3.5 times faster than inflation. Let’s see how this plays out if a recession hits.
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Rob’s personal finance reading list
So long, Mint.ca
The Canadian version of the popular budgeting app Mint is being absorbed into another financial app called Credit Karma. Here’s a list of some budgeting app alternatives to Mint.ca, and here’s a Reddit discussion on favourite apps for keeping track of your spending.
Lower prices? No thanks
A U.S. investing blogger offers a tough-minded analysis of inflation and what it would mean for prices to decline from current levels. As good as that sounds, it would be disastrous in some ways.
Who doesn’t like EVs?
Thieves, that’s who. Check out this list of the most, and least, stolen vehicles. What thieves want are SUVs and pickups, and not the EV version.
How to fight off a layoff
Advice on what to do if you fear you might lose your job to a layoff, or be fired. Timely stuff, given that the job market is cooling fast.
Q: I would love to see an article explaining who profits from these higher mortgage rates. Is it the banks/lenders? If so, this should offset any defaults and make them a good investment going forward.
A: Actually, high rates are probably the same or worse for mortgage lending than low rates. First, lenders have to pay more to attract deposits that can be used for mortgage lending. Second, high rates put pressure on borrowers to keep up with their mortgages. Late payments and defaults typically rise in periods of high rates, and banks must set aside money to cover any losses. Bank stocks are mostly down this year, a reflection of troubles caused in part by high rates. Perhaps a buying opportunity.
Do you have a question for me? Send it my way. Sorry I can't answer every one personally. Questions and answers are edited for length and clarity.
Tools, Explainers, Guides and Charts
How to identify home improvement and loan scams, which particularly target seniors.
The Money-Free Zone
Here’s a newbie’s guide to appreciating Formula 1 car racing, which has been breaking through in the U.S. market and thus getting more attention. Long-time readers will know I got into F1 by watching the super-fun Netflix show Formula 1: Drive to Survive.
The expected cost of pessimism about the stock market.
On social media
Reasons to delay your Old Age Security payments past age 65.
In case you missed these Globe and Mail personal finance-related stories
- Here’s how home owners can age in their own place, even if they are struggling to afford it
- Joint ownership of homes and other assets can lead to unintended tax problems
- Would-be retirees: Should you start your CPP pension before year-end or wait until 2024?
More Rob Carrick and money coverage
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Even more coverage from Rob Carrick:
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