I feel that the telephone companies charge way too much for their services but since we all seem agreeable to pay for it, then we're stuck with their pricing. Since the writing of this article, I have gone completely mobile and stopped having a home phone. This saves me annoying telemarketing calls that get through even though I signed up to be on the national do-not-call list.
The actual cost of a cell phone contract is befuddling. Cell phones are rarely viewed as luxury items anymore, although in reality, they aren't a necessity. The cell phone - with its convenience and the natural independence it creates - has become a basic prerequisite these days. Evaluating cell phone contracts can be confusing, overwhelming, and time intensive. But, with enough perseverance, you may be able to decrease your costs by $500 or more per year!
I have gone month to month paying for a wireless contract which seems exorbitant to me; paying for a land line home phone and a cell phone just doesn't fit within my budget. It is time to negotiate a lower cell phone bills which will have a positive impact to lower my bills.
Here is a breakdown of my current cell phone contract
Somehow I never stay within my allotted minutes and my international text messaging habit puts me over the top ($0.25 for every incoming and $0.50 for every outgoing international text message). With the taxes and the additional features I use, I spend an average of $140 per month for my cell phone bill. This monthly cost is too expensive for my frugal taste.
Every time I request a different calling plan to better suit my needs, my contract is extended by at least another year. My program conveniently becomes obsolete over time and doesn't seem to support my usage habits. I guess I have to admit it; I'm a cell phone junkie. The majority of my personal and business calls are conducted via my cell phone which explains the heavy usage. However, if I cancel the service with my carrier, I will be penalized $175 for early termination - ouch!
Sooner or later I'm expecting that a secondary market will emerge. People with remaining contracts will be able to transfer their phone contract to the highest bidder on eBay instead of paying these horrible early cancellation fees. I suspect that like health club memberships and some airline miles, second-hand phone contracts will be transferable. Or, better yet, maybe cell phone carriers will stop the contract requirement all together.
In the meantime, I continue to pay my monthly bill for a service which I think should more appropriately be priced at $50 per month. I'm disgusted every month when the bill comes due. This month, I vow, something must change. Before I know it, next month's bill arrives and I haven't changed my usage habits, my carrier, or my plan. Recently, I was introduced to the Let's Talk website which does an excellent job of comparing individual and family cell phone plans. Most of the major cell phone players are represented such as: Cingular, Verizon, Alltel, T-Mobile, SunCom, NexTel, and US Cellular. In most cases, the website allows you to simply plug in your desired cell phone features and compare features between carriers. I quickly determined that for 1000 minutes I should be paying about $79.98 per month. At least I know that my plan, for the features I chose, is competitive at the time this article was written. The overage charges, the text messaging extras, and the taxes always blow my cell phone budget each month.
Committed to radically lowering my cell phone bill, I have gone on a quest with a family member to jointly negotiate our cell phone bill. We have agreed that it doesn't make sense for both of us to be paying over $100 per month for a service where many programs now allow additional cell phone lines on a family plan appended to the same contract for $9.99.
After two hours of research and calling customer service specialists at each of our difference carriers, we managed to negotiate a suitable plan for our multiple cell phone lines. We made it clear to both carriers that either I or my family member would cancel our accounts and join the other carrier - It was up to them to provide a plan to keep our business.
We determined we would need a total of 2500 minutes each month, divided between us. The following are the plans presented to us by each of our carriers:
|Carrier A||Carrier B|
|Charge per phone||2 free phone lines - $10 for each additional phone line||2 free phone lines - $9.99 for each additional phone line|
|In Network Calling||Free||Free|
|Roaming||$5 per month||Free|
|Nights and Weekends||$5 per month to have feature start at 7pm instead of 9 pm during the week. No charge for weekend usage||No charge after 9pm during the week and no charge anytime on the weekends|
|Additional minute charges||$10 for every pack of 200 minutes that exceeds the initial 2500 minutes (this equates to $.05 a minute but you lose the minutes you don't use)||$.25 per minute|
|Equipment Charge (2 new phones needed)||Free - shipping and handling included||$9.99 minimum each phone|
|Activation Fee||Free for each phone with a 2 year contract||$20 each phone for 2 year contract|
|Text messaging||$10 unlimited text messages (incoming and outgoing). This includes national and international text messages. This service is free for the first 2 months of the contract and may be cancelled.||$5 unlimited text messages in network - 50 domestic out-of-network text messages included per month |
$.25 incoming and outgoing international text messages
|Early Termination Fee||$150 per phone||$175 per phone|
|Total Monthly Charge (Approximate without taxes and overages)||$145||$169|
All in all, by adding two additional cell phone lines to my family member's account plus the text messaging charge, her monthly bill will go from $115 to $145. I begrudgingly still have to pay a $350 penalty to 'Carrier A' for canceling my contract of the original two cell phone lines; this irks me to no end. Every carrier has these early cancellation policies, so I'm not angry at 'Carrier A' per say, I'm angry that I have to sign such a ridiculous contract in the first place. I realize that there are carriers who offer a no contract plan but you are required to pay a premium for this service.
I've arranged to pay the additional $30 increase that my family member's account will incur each month for the additional two lines and text message service. The remaining $110 of my usual cell phone bill will make up for the cost of the contract cancellation of the two phones. It will take approximately four months to recoup this charge.
Old Family Plan
With the old family plan, I was spending about $1,680 per year and my family member was paying $1,380.
Total Annual Spending = $3060
My Family Member:
New Family Plan
With the new family plan, my family will save about $1,340 per year! Once the penalty charge has been paid in full, I will split the monthly cost of $72.50 for two lines and my family member will also pay $72.50 for her two lines. I still think the cost is absurd, but over the course of the next 12 months, I'll save $520.00 and next year it will be a savings of approximately $870.00. Fortunately, with this new plan, the overage charges will come out to $.05 a minute instead of $0.40 and I will now have unlimited domestic and international text messaging for $10 per month.
Total Annual Spending = $1740
My Family Member:
There are enough features with cellular phone programs to make anyone's head spin. I ended up reading my notes back to the customer service representatives twice in the hopes that I absolutely understood what I was getting into with their programs. I still probably missed a detail somewhere along the way. The cost of the family plans are definitely improving, but in about a year I will need to reevaluate the costs again to ensure that the pricing plan I have is still competitive. Although it should go without saying, in order to take advantage of a multiple-phone family program, you need to be able to trust the person who is helping to pay the bill. Now that I'm on the same network as my family members, I imagine that my minute usage will decrease substantially since 'in-network' calling is free. Remember to ask your carrier to clear out your personal information on a previously used phone. You may be able to sell the phone, get a discount on a new phone, or at the very least donate it to a charity.
Don't procrastinate on researching a more cost-effective cell phone program; you may save yourself $500 or more each year in needless expenses
The history of cell phones truly begins during World War II, when operators would patch radio communications into telephone lines.
A cell phone signal booster that uses an antenna can be an effective way to improve the quality of calls on your cell phone.