Financial Tips
How to Save Money : Lowering Your Phone Bills
Improve Your Household Budget by Lowering Your Phone Bill
From a household budgeting standpoint, it makes sense to periodically review your expenses. According to the debt management professionals at Credit Counselors, a great place to start is with a review of your monthly phone bills. For a typical household, a seemingly small savings of $20-30 per month adds up to hundreds of dollars annually.
Scrutinizing Your Phone Bills
No matter what type of service you use (landlines, cell phones, or both), the best way to uncover savings opportunities is by closely examining your monthly billing statement. Credit Counselors shows you where to look:
Landline Phone Service
To begin, take a look at some of the optional services you're paying for. Ask yourself which of these things are truly necessary. For example, is Caller ID something you can live without? How much is it monthly? What does that work out to annually? Is it still worth it? Also look at voicemail charges, insurance charges, and wiring maintenance fees. Many of these may be options you rarely, if ever, utilize.
Another easy savings area is operator assistance. If you're in the habit of dialing information or directory assistance, the fees can accumulate annually to a surprising amount. Most of the time, these tasks can be handled without the operator's assistance. Grab a printed phone book instead, or check for the number on the Internet.
Finally, examine your average number of long-distance and/or international calls. Determine the rate per minute for these and look into cheaper alternatives. If you make frequent calls of this type, there may be substantial savings opportunities available either through other carriers or by switching to a mobile phone. Others do away with their long-distance service altogether and opt for purchasing prepaid long-distance cards. (Caution: Many prepaid plans have expiration dates.)
You may want to consider bundled plans which include phone, with internet and television. There are some good deals out there such as a 2-year contract with unlimited long distance service.
Mobile Phone Service
If you have a cell phone, keep in mind that these devices have made it increasingly easy to overspend on phone service, so it is very important to read the fine print. Instead of being concerned mainly with long-distance rates, you need to mind your use of the numerous extras such as text messaging, web access, ring tones, peak calling times, roaming charges, and more. What's more, it can be difficult to compare plans since so many differences exist.
To begin, take a look at your unique habits over the past several months. When do you typically make your calls? How long do they last? Are you sending and receiving many text messages or accessing the web regularly? If so, how much is that costing you? And, don't forget: Often the phones themselves can represent quite an investment. Do you really need a camera phone? Do you truly need the thinnest model, one with a built-in MP3 player, or a specific brand?
Finally, ask yourself: Of all of the extra services I'm paying for each month, is it truly worth it? It may be difficult to break some habits, but if your goal is to find ways to save and improve your household budget, it's worth the effort. Keep in mind, this may not always mean simply 'doing without.' Rather, it may mean simply modifying your cell phone usage somewhat ' doing things like minding the times of your calls to remain in off-peak hours, limiting your calling while roaming, avoiding extras such as ringtones and video games, etc.
If you've identified ways to save money and want to consider switching, be careful. Often plans have cancellation fees. If you're near the end of your contract, it may make sense to wait a short while before switching. (If you don't know whether there is a charge for cancelling your plan, take the time to find out before doing so.) Similarly, prior to switching, make sure you thoroughly understand the terms and conditions of the new plan. Reading all of this documentation takes time, but can pay off substantially in the end.
When exploring new plans, don't forget to look into various prepaid plans if you're simply an occasional user. When exploring these plans, check the carrier's policies regarding per-minute fees, rollover minutes, and costs for purchasing additional minutes.
When it comes to children and cell phones make sure that the cell phone plan matches their needs. They do not need the latest technology if the phone is merely a means of communication between parent and child. Also, instruct them not to order additional items without prior permission. This can really add up if it is a service that is charged until the contract expires.
Newer Options
Over the last few years, newer options have come to the marketplace that should also be considered. For example, Internet-based phone service allows consumers to make telephone calls over the Internet. These plans require a broadband connection and generally incur a monthly fee. Along those lines, many cable and satellite companies offer bundled services that include television, phone, and Internet all in one. In either of these cases, it's critical to understand the terms, conditions, and fees prior to signing up.
Seek Professional Budgeting Help
Many consumers who receive seemingly exorbitant phone bills report being taken by surprise by the amount. Many factors contribute to this. For one, it's difficult to project forward when first selecting a plan. That's why the professionals at Credit Counselors recommend breaking out past bills. It's always easier looking backward when selecting a plan to closely match your calling habits.
Note: If you're switching to a family mobile plan based on the analysis recommended above, it's equally important for your family members (i.e., anyone who will have a phone on the plan) to understand the terms and fees involved.
For additional tips on saving money and household budgeting, don't forget to contact Credit Counselors for a personalized and confidential budgeting session.
