I was cleaning out some papers in my closet and came across something interesting. It was my old check book from last year. On my old check book I took notice of each month’s cell phone bill. Looking back in time it was a pretty high bill compared to what I am paying now. It was actually around this time last year that I decided to change service providers. Now that I am thinking about it, changing cellular providers was one of the very first things I did last year to reduce expenses. This was before I even before I moved to my new place and I started to apply a more serious budget.
One of the major expenses nearly everyone endures each month is the cell phone bill. Charges for cell phone service differ between providers with different plans for individuals and families. According to this article, the average American household spent $1074 for cellular service in 2016. According to other surveys conducted that asked individuals what they are paying monthly revealed it was well over $100 depending on providers (ranging from $120 per month to $148 per month). But of course, so much depends on your individual circumstances and/or family needs.
In that case, to each his or her own. But sometimes, it is just excess. My phone bill was $114.82 per month for the year 2016. Rounding that up to $115 multiplied by twelve meant $1380 was spent per year on cellular service. My provider at the time was T-Mobile, just because it always had been since my mother purchased a family plan for all of us. When my mother passed away, it was just my brother and I on the plan and we would split the bill almost in half. I say “almost in half” because for some reason I had insurance on my cell phone that added an extra $15 to the bill that I was paying for myself.
So I end up paying about $65 per month for my cellular service while my brother put in the other $50. At $65 per month I was spending $780 per year for cellular service. Below what at average American spends, but as time passed I still wanted to go lower. First I cut out the insurance. I have had the same cell phone (Samsung Galaxy S4) since 2014 and to this day (*knocks on wood*) have never dropped, damaged, or lost my cell phone. I am very careful with my phone. So insurance was first on the chopping block, but I started to look for better plans.
This is when I noticed I had excess of what I needed. I rarely go above the 1GB data mark so did I really need to pay the price for 4GB? It did not make sense to me and my brother agreed. So in December of 2016 I decided to change providers and go with a less expensive plan. I was a single individual and did not need anything extravagant. I switched to Cricket Wireless and got the $30 per month 1GB plan with unlimited talk and text. That was really all I need, anything else would be excess.
Sure, I could afford some 5GB Plan, 10GB Plan, or Unlimited for anywhere between $60 to $90 per month depending on the provider, but that would all be excess of what I use and need. Funny thing is the salesperson even tried to talk me into a higher plan. Obviously it didn’t work. I had become much more frugal with my money over the years, learning to avoid excess expenses that are unneeded. For example, I could afford the best Cable package with hundreds of channels and other great add-ons. But do I need (or want) all that for over $100 per month? No, Hulu and Netflix do it for me. I don’t need the excess.
Sometimes it is living within your means and sometimes below your means. Knowing what you need and don’t need is essential in saving money. The more money I save, the more money I can invest in quality dividend paying stocks and build up my portfolio. The more money I save, the more I can build up my wealth for the long-term. This can work for you too. I can happily live with my cellular service at $30 per month with 1GB data. Actually, last month Cricket Wireless has raised the amount from 1GB to 2GB for the same price plan ($30). So I guess there is a plus: some excess without increased cost. In this case, I’ll take it!
So, since I have switched I have spent $30 per month on cellular service adding up to $360 per year as opposed to last year where I spend $65 per month adding up to $780 per year. That switch is saving me $420 this year! Sounds good to me! How about the rest of you guys? Do you think you are over paying for cellular service? Got any other ways of saving on your cell phone bill?