In an economic environment where it feels like you get nickel-and-dimed at every corner, many people are searching for free alternatives to their favorite apps and services.
But just because an app is advertised as free doesn’t mean there is truly no cost.
Even services that don’t charge users a price up front have to make money somehow, and often they do so by selling users’ data, tempting them into add-ons or upgrades or using dark patterns to trick you into spending money.
The truth is, if you want to keep your personal information and your wallet protected, you’ll need to be just as careful around free apps as paid ones.
Costs To Look Out For In “Free” Apps and Services
“Many free apps are still making money, but the cost to us is hidden,” James DeLapa, director of digital marketing at Wrike, said in an email.
Companies have to make money, so if they aren’t charging a flat rate for their services, they are likely doing so in another way.
This might be charging other companies for affiliate links or ad revenue, or it could be mining your data and selling it to third parties, among other tricks for bringing in income from a “free” app.
In particular, watch out for these three “costs” associated with free services.
1. Data Collection
Almost every app you sign up for is collecting some kind of data on its users, but that data isn’t always what you’d expect. And the company might even sell your data to other interested parties to make a buck.
[READ: Money Apps That Collect the Most Data on Their Users]
“Companies may collect your data and sell it to marketers who use it to target you in even more appealing ways. If they know how you browse, where you go, what you buy and who you talk to, they have everything they need to target messages that will tempt you to buy,” DeLapa said.
Your personal information has value, and you should be cautious regarding with whom you share it. Not only do you want to avoid having your data sold to a third party, you should make sure you can trust the security of your data in the hands of the service you signed up for.
“If these companies are breached or your data gets sold to a malicious actor, you could become a victim of cyberfraud or identity theft. And while we can’t eliminate the potential of that happening completely, we can reduce that threat by avoiding free apps made by companies that don’t take information privacy seriously,” DeLapa advised.
[This Is What Fraud Costs Consumers]
2. Upgrades and Add-Ons
Sometimes you sign up for an app thinking it’s going to be free, only to be met with costs to unlock many of its features or constant ads urging you to upgrade to premium services. This could be in-app purchases or even a monthly cost to use many of the features you saw advertised.
“These types of free services tend to be even more insidious because it’s easy to start seeing the convenience of an upgraded version as a necessity once you’re using the app or service regularly, and the low monthly cost can be enough to lure many people in,” Carter Seuthe, CEO of Credit Summit, said in an email.
Not only can you be tricked into spending money you didn’t expect to on one-time upgrades, but signing up for these subscription-based services could saddle you with a monthly payment that wastes money long term.
“Lots of subscription-model apps and services rely on you not getting your money’s worth out of the app, and then they rely on you never canceling the subscription once you’re no longer using it at all,” Seuthe said.
3. Dark Patterns
Difficult-to-cancel subscriptions are one example of what is known as a dark pattern — or a design tactic that a website or app uses to coerce users into spending money.
Other dark patterns can be costing you on seemingly “free” platforms as well.
[What’s a Dark Pattern and Has It Already Cost You Money?]
One such pattern is a bait-and-switch, where the app draws you in with certain features only to reveal after you sign up that those are available only for a cost. There are also design elements that trick users into signing up for more expensive plans, even if a free one is available.
Evaluate Every Service You Use, Regardless of Price
You might think you’re keeping a tight budget just by avoiding paid apps and services, but these hidden costs show that true financial and data health requires you to be vigilant even when you sign up for “free” apps or services.
Follow these best practices to keep your money and data safe:
— Read the terms and conditions. This will tell you what data is up for grabs, so you can decide if it’s something you want to share.
— Evaluate subscriptions regularly. This will help you avoid being sucked into a monthly cost or upgrade that doesn’t offer you any value.
— Watch out for dark patterns. Also, use conscious purchase strategies like mulling over purchases for 24 hours to avoid getting caught by these tricks.
— Research services before you sign up. This way, if you’re going to hand over your data, you can ensure it’s to an organization you trust.
Free apps can save you money, but you’ll need to consider the potential trade- offs.
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Real Cost of Free Apps and Services originally appeared on usnews.com
