Cutting expenses without reducing service

My Story: Cutting the Cost of Phone and Cable

contributed by Gordon R.


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My project for the last year has been to reduce our family's Telcom bill. This is not an easy task. With a teenage daughter and my wife working more, we have expanding needs. Even against those odds, I have been successful.

First up, I wanted to cut the cable TV bill. That's easy. We just eliminated it and joined a growing number of cable cutters. There is plenty of video content on Internet sites like Hulu Plus. Also, Netflix, Roko, Boxee, Zinc and others will deliver Internet video content that rivals cable. Savings: $40 to $60 per month.

Next, I focused on the landline. Yes, we still use a landline phone. The savings here came from dropping the traditional phone carrier and going with a VoIP phone system. There are many to choose from, including Vonage, Magic Jack, Ooma, and Skype. I almost went with Skype because I could buy a Skype Wi-Fi handset and make calls from any free Wi-fi cloud. It's kind of like a poor man's cell phone. At home, I could link the handset to my wireless router and have the convenience of a cordless phone. But instead I went with a company named Phone Power. They sent me a free adapter that connected my existing phones directly to my network. No computer was needed to make and receive calls. The list of included features is long, but the best one is the ability to have two calls going simultaneously with a single phone number. This feature is particularly handy with the aforementioned teenager in the house. The cost is less than half that of a traditional landline. Savings: $30 per month.

A couple of years ago we suddenly needed a second cell phone. The most obvious thing to do was to convert our existing plan to a family plan, but that would cost an additional $20 per month per line, which isn't really too bad if you use it a lot. Instead I bought a prepaid cell phone. After some research, I bought a 7-11 Speak Out phone (no longer available). At the time, 15 cents a minute was a good rate for a prepaid phone. Today, there are better plans. But that phone has only cost me $100 per year for the last two years. That works out to less than $10 per month. Another phone was activated with Page Plus Cellular. I put $25 on it about every six to eight weeks. Our primary cell has also been ported to a Page Plus $30 per month plan that gives us a huge bucket of minutes and text.

The best part about having prepaid cell phones is that I can control the costs. Like any other pay as you go service like water or electricity. If I want to save money, I just use it less. Savings: I figure that I'm paying about $55 per month for three cell phones. A three-line family plan with a reasonably large bucket of minutes would cost about $110 per month, so let's say the savings are $50 to $60 per month.

I'm still working on Internet. With VoIP, streaming video, movie downloads, etc., I have no choice but to have broadband Internet access. At $45 per month, it's twice what I want to pay. I will pass on a few alternatives that may work in your situation. DSL is available in a range of speeds from 768K up to 12Mbps depending on how aggressive your local phone company has been in upgrading their system. Before getting DSL service from your local phone company, check out some third party providers, such as DSL Extreme. Clear.com is deploying fixed-point wireless Internet access around the USA. They are a viable alternative to DSL and cable Internet. Several coffee shops and fast food joints sell subscription Wi-Fi Internet access. With a good antenna (search "Cantenna"), you can beam into a Wi-Fi bubble from several blocks away. None of the above have turned out to be a viable alternative for me. Savings: for me, none so far. I hope you can do better.

Trying to figure out my total savings is like trying to hit a moving target. I have saved big by cutting out cable and going to a VoIP phone service, but that is balanced off by the need for higher speed (and higher cost) Internet service. Paying for premium Internet video (Hulu premium or Netflix) would also reduce the savings. With the cell phones, the win has been to hold the line on costs while increasing use. Three cell phones for about $55 per month is very good. I figure that I'm saving between $50 to $100 per month.


"My Story" is a regular feature of The Dollar Stretcher. If you have a story that could help save time or money, please send it to MyStory@stretcher.com.

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