3 smart ideas to trim down your monthly telephone bill
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Consumers are clearly feeling the pinch of increasing costs. From the gas pump to the grocery store, prices are skyrocketing. Yet the phone bill is an area where savvy consumers can still save. For most people, phone expenses are a not insubstantial line-item in the typical household budget. Notwithstanding the fact that telecom prices have dropped considerably in recent years, this is still an expense that can be reduced through prudent planning. These tips will help you achieve this goal.
Tip 1: Switch over to a shared-use plan on your cell phone bill
According to the Kiplinger Letter, the average cell phone bill in the US runs approximately $55 a month. You might wonder how the average could be $55 with so many ads for cell phone companies promoting $29 or $35 plans. This is partly because a few power users spend $79, $89 or more per month. Part of the reason is taxes and miscellaneous charges such as 411. But a crucial reason is the fact that cell phone companies hit you on "overage". Let’s say you have 1,000 peak minutes in your plan and this month you get to 1,099. At twenty five or forty cents per minute on overage, your cell-phone bill suddenly rockets up twenty dollars. Sound familiar? The next month you get to 900 minutes but you don’t see a corresponding drop in your bill. Some companies say they solve this problem by allowing you to rollover minutes. And it is true that the rollover does increase your peak minutes quota for the next month. Yet even then, you still get hit with overage if you exceed the increased peak minutes quota.
Shared use plans are the most elegant solution for this problem. Also known as "family-plans", these plans enable you to aggregate the minutes of 2 or more users into a bucket. Since variability is typically a function of individual usage patterns, these quotients tend to cancel each other out. Think of it this way: if you and your spouse both had individual plans for 1,000 minutes and one month you get to 1,100 minutes and your spouse reaches 900 minutes, you’re in for overage surcharges to the extent of 100 minutes. If you have a family plan, your total comes in at 2,000 minutes and no overage!
Tip 2: Stop using your regular long distance phone company to dial internationally
Most long distance providers offer very good rates for domestic long distance. If you are a reasonably frequent user on a good plan you are most likely paying less than 5 cents on a per minute basis. The difficulty is that international rates are still comparably high. For instance, fifty cents a minute to South Asia is typical, even if you pay the four or five dollars a month many companies charge to get lower rates.
In recent years, there has definitely been an explosion of superior options. Sometimes known as "PINLESS" dialing plans, these offerings allow you to call anywhere in the world at rates forty to seventy percent less from your landline or cell without needing to dial a pin code. If you type the phrase "cheap international calling" into a search engine you’ll see a plethora of options. The basic way these services work is that callers register one or more phone numbers with the service and input a credit card number. They offer you a toll-free number and when you dial this number from a registered phone, you can call any country without needing a PIN code. Using the above example, you could reduce the charge from 50 cents to 15 cents per minute.
Tip 3: Start using a free teleconferencing service
For a lot of families, phone charges escalate due to the need to have multiple conversations between family members on the same topics. It is not efficient but this is the way most of us cope. In the last five years, there have been dozens of companies that have launched free teleconferencing services. All of them work on the same basic idea: they give you a PIN and a toll number to call. If all participants dial the same number and enter the same PIN, they are put into a group call. Apart from normal toll charges, there are no charges assessed by the companies. If you have a large extended family, one 30 minute call could easily replace five to ten one-to-one discussions for planning a trip or family event.
Unfortunately, it is usually somewhat of a chore to arrange these calls in the first place; consumers often are therefore reluctant to familiarize themselves with the mechanics of setting up a conference call. Rondee is an example of a free conference calling service which is working on addressing this issue. It offers users a way to schedule the conference on the web, have the invites emailed out and show all the responses displayed on the website. As with many corporate grade conference call companies, Rondee allows calls to be recorded.
With consumer prices rising, there’s not a lot most of us can do to fight back. But phone expense is an area where being smart can mean saving a lot. Applying these three tips will save the typical consumer 30% to 50% on a monthly basis, or several hundred dollars yearly.
Scott Baily writes about the telecom industry. He consults to a number of firms within the industry and monitors the latest trends in consumer behavior. His clients include free conference calling services such as Rondee.
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