Overpriced data packages and pay-by-the-minute cell phone service can cost the average family a pretty penny. In fact, the Utility Consumers’ Action Network, a San Diego consumer advocacy group, reported that the average cell phone user pays $3.02 a minute. Customers paying for “anytime minutes” only use a third of the time allotted to them by their service providers. If that wasn’t alarming enough, the majority of land line owners pay 10 cents per minute or more with 20% of people paying more than 50 cents per minute and 10% paying more than $1. Once tacked onto your bill with taxes and fees, these expenses can be far more than your budget can handle. Whoever said talk was cheap never received a higher-than-usual cell phone or landline bill in the mail.
There are a couple of ways to get around this. Here are some quick ideas for lowering your phone bill this year:
- Get the most basic cell phone package that there is. A pre-paid cell phone plan eliminates the element of surprise. There are no hidden charges, no contracts, and no added expense. $9.99 a month gets you 50 minutes a month with Tracfone (http://www.tracfone.com). For $25.00 a month, Virgin Mobile (http://www.virginmobileusa.com) offers 300 minutes and unlimited access to text, email, data, and web. This option gives you plenty of opportunity to keep in touch with your personal and professional contacts.
- Consider switching to Skype or Google Talk. “In addition to sharing voice and video chats with your contacts from computer to computer, you can also place and receive phone calls to any landline or mobile phone number in Gmail for free,” with Google Talk (http://www.google.com/talk/). International calls require additional credits but the price per minute is significantly less expensive than other providers. Skype (http://www.skype.com) offers a similar package. Computer to computer calls are free. Phone calls to landlines and mobile phones can be made only after credits are purchased. Unlimited phone calls in North America costs $7.99 a month while worldwide calls to 40 countries costs $13.99 a month.
- Buy the magicJack and get access to free local and long distance, directory assistance, caller ID, call waiting, and voice mail. Simply purchase the magicJack (http://www.magicjack.com) online or through a retail store and plug it into your device. Once it feels secure, plug the magicJack into the USB port on your computer and follow the screen so you can register the device. Once that step has been completed, pick up your phone and make a test call. It’s as easy as that! The magicJack costs $39.95 and it comes with one free year of service. Each additional year costs $19.95 which amounts to 11 cents a day. That is a far cry from $3.02 a minute statistic that we reported above.
- See if you qualify for a Safelink Wireless phone. “Safelink Wireless (http://www.safelinkwireless.com) is a government supported program that provides a free cell phone and airtime each month for income-eligible customers.” The exact benefits a person receives depends on the state that they live in. Generally speaking, individuals qualify if they participate in a public assistance program such as Food Stamps, Medicaid, Supplemental Security Income (SSI), Temporary Assistance for Needy Families (TANF), Low Income Home Energy Assistance Program (LIHEAP), National Free School Lunch, Federal Housing/Section 8 Assistance. If you do not receive any of these public assistance programs, you may also qualify based on total household gross monthly income.
There is no sense in paying more than you have to for phone service. In fact, there are plenty of options available to you if you’re willing to do some research before making a full-blown commitment to a company like AT&T, Sprint or T-Mobile. By avoiding contracts and evaluating the amount of minutes being used in your household, you can trim the fat and pay for what you use not what a cell phone or home phone provider expects you to use. This amounts to hundreds of dollars worth of savings each year which can be used in other ways by you and your family members.
Author: Jeremy Vohwinkle
My name is Jeremy Vohwinkle, and I’ve spent a number of years working in the finance industry providing financial advice to regular investors and those participating in employer-sponsored retirement plans.