This is Scott’s first entry, about time he start helping
out a bit with the blog.
In America, seems almost everyone from Wall Street hedge
fund managers to 7 year-old children have a cell phone. It’s the new necessity
it would seem. Good luck getting anyone normal to stop and help you on the side
of the road if your car breaks down because they figure you’ll just call
someone on your cell for help, so a cell is a nice thing to have if you don’t
want to be kidnapped and murdered by a crazy person. But this doesn’t mean you have to pay an arm and a leg for cell
service!
Until recently, we were paying $152/month total for our two
cell phone plans. Through AT&T we got 550 minutes, unlimited text and about
3Gig of data per month. And that’s even
AFTER the 22% discount I get through my work for the plans! $15 of this
total for TAXES! There are car leases you can get for less than $150/month!
After discovering a whole world of cheaper cell phone providers mentioned on
sites such as Mr. Money Moustache (a web forum aimed at frugality and achieving
early financial independence) and Howard Forums (a web forum devoted to all
things cell phone), I decided to give another provider a try. I also decided to
significantly decrease my data usage because that’s the most expensive part of
a cell phone plan for smartphone users. It’s hard to make this $10 plan make
sense if you don’t because of the steep data charge per mb.
After doing some research I found a company called
AirVoice (this is a GSM provider, there are CDMA like Verizon/Sprint and GSM like AT&T (with GSM you can easily swap SIM cards, CDMA you can't so it's good to know what kind of service/phone you presently have) . In the industry, there are smaller cell phone service providers who
lease existing cell tower bandwidth from larger providers. This company uses
AT&T towers so since I was happy with the reception I’m currently getting
from AT&T, I went with them. They also have good customer service reviews.
I am not endorsing this company in any way, there are many others you can
choose from if you do your research (Howard Forums is a great resource for
this). They are also a GSM provider which makes it easy to just swap their SIM
card into my existing iPhone and use their economical plans.
In our case, we had signed a two-year contract with
AT&T about a year ago. 24 months, $150/month, total cost $3,600! We are
only a year into it and there’s a charge to cancel your contract that equates
to about $195 per phone at this point-OUCH. But with 11 months left that comes
out to $18/mo so I figured if I can save enough it would be worth it to cancel.
I also only cancelled my phone because I feel like it’s easier for me to cut my
usage than my dear wife because I am sitting at a desk 5 days a week with an
office phone and WIFI at my disposable, whereas she’s out and about usually
away from WIFI and uses data to navigate around town, etc. (which speaking of,
there are inexpensive navigation programs that are saved to your phone so you
use zero data to navigate which is probably what I’ll get for my phone).
So you can go directly to the cell provider and order a new nano
size SIM card, but if you go on ebay or amazon you can find them for only 99
cents shipped. They are so cheap because if you use their provided agent number
when you sign up they’ll get a commission on the backend. So I ordered my 99
cent SIM card and it showed up in three days. Got on the AirVoice website and
used their online form to “port” (basically transfer your phone number from
your old carrier to new). No contract so no social security number required! I
got a $10 total /month plan which gives me $10 to use (no additional tax!), and
your use goes against this balance. No fees to port my number. When you port
AT&T automatically cancels your cell plan with them.
The AirVoice plan I signed up for is basically a monthly
prepaid plan that I set up for automatic renewal every month. Their prices are
$0.04 per minute of talk (250 minutes), $0.02 per text (500 texts) and $.066
per mb of data used. (there is 1,024 mb of data in 1GB, a good thing to know to
compare cost). This means you are charged whatever applicable fee for each
“type” of service until your $10 is used up.
So a couple of things: iPhones technically use an app called iMessage to “text” (it
actually uses data or wifi to send messages to other users who have imessage on
their phone as well). So I have my Cellular Data settings in my iphone turned
to Off to avoid data charges completely (you can also select specifically which
apps use data, if the phone will update apps or programs while on data, etc).
There is also a counter you can reset to monitor data usage which is handy.
Under this AirVoice plan, 1GB of data would cost you $67. EXPENSIVE! So if you
cannot commit to using wifi for most of your data needs then another plan is
better for you (AirVoice also has plans with more data included starting at $30
but I have not tested these).
Halfway into the month (15 days) I’ve used $5 of my plan.
About 125 minutes of talk mainly with a few texts thrown in there to/from
people without an iphone. No data
usage, I only use wifi where it’s available. If you’re a single person then
this plan might not be for you, I have the luxury of using my wife’s unlimited
plan on her phone if needed because we are often together when I’m not at work.
(I will eventually change her phone over as well but the savings wasn’t as
great since I won’t significantly downgrade her plan at this time compared to
the $195 early termination fee.
The way I figured the math is I was basically spending
$75/month with AT&T to talk an average of 250 minutes and 250 texts (my
normal usage) plus my data usage. At the Airvoice pricing this would cost me
.04/min talk ($10) plus .02/text ($5) for a total of $15 for talk and text,
which ($75 minus $15=$60) means I was basically spending $60 for the data
portion of my plan-which is just too much considering I have access to wifi for
free (or already paid for at home). This is $120 for two phones which is a
decent chunk of budget just to be able to use data on the go I think. I just
bring up pages I might want to read while in wifi and keep them to read if I
need to while out, and my next plan is to get a mapping app that sits in the
phone memory so I don’t have to use data to find my way around town. I’ve also
significantly decreased my text message charges because they basically go
through iMessage for free when I’m connected to wifi, which is why I’ve only
spent $5 on my cell service 15 days into the month!! Hope you find this helpful!
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