Saturday, February 20

You don't need a cell phone

Matt over at Steadfast Finances had a piece recently on cutting down telecommunications expenses. He points out that most of us pay between $100-300 a month for land line, Internet and cell phone. (This assumes $25-100 for a land line, $35-45 for Internet and $40-110 for your mobile phone.)


He mentions three options for cutting down on expenses. The one I like most is the option of the Magic Jack. Apparently, he's had a good experience with it. And this is definitely one way to cut down on costs.


But.


His other two suggestions? Kill the land line, up your wireless minutes.


Let me see... Our options are a $25 land line or a $50-110 (I haven't met anyone in ages who actually has a $40 cell phone) cell phone. Now, I haven't taken a math course in 13 years, but even I see some basic issues here!


First, let me say this post is not intended to criticize Matt. His is actually the second post I've seen in the past week with the same advice. So he just happens to be the most recent example.


Now, getting back to the matter at hand. I know you all love your cell phones. I get it. I do. They're awesome and shiny and fun.


But, if you are really looking to cut costs, why oh why would you choose a cell phone over a land line?


I haven't met anyone in ages who pays less than $50 a month for a monthly plan. In fact, with data plans, most people hover a lot closer to $100 than to $40. Yet, in the other post (which I wish I could recall) a reader was cutting costs as a newly single mom by getting rid of her land line. Meanwhile, she and her kids had cell phones.


Once again, I feel the need to point out some basic math here: $60 a month (the cheapest you can generally get with a three-line family plan) is a lot more than $25.


I guess I should take a minute to state what I hope is the obvious. If you aren't hurting financially, if you've budgeted for a cell phone and data plan and can still save money each month, I'm not talking to you. That's a luxureed, and that's just fine.


Similarly, if your company covers some (or all) of your cell phone service, by all means. Or if you are one of the few folks who is not really based out of a home office, but instead is on the road -- hey, that's legitimate.


The rest of us, though? We don't need cell phones. We want them. We find them useful. But for all of you who are about to protest that you absolutely need your phone, just know that I'm skeptical, to put it lightly.


Most people work in an office -- either at a company or from home. Offices have phones, and home offices can have phones. A cell is convenient, since you can be reached in transit to either place. But is it convenient enough to justify a $25-75 premium? I honestly don't think so.


For those of you who protest that you'll miss calls, most answering machines can be accessed remotely nowadays. At worst, you can usually get a $25/month land line package that includes voice mail. Again, a cell phone is a convenience, but hardly the necessity we tend to claim.


The one I understand best is that parents want to have a way to reach their kids, or to have their kids reach them -- especially in case of emergency. But that's when a prepaid phone can come in handy. At least once a month, some store is offering one of these devices for free after rebate.


Of course, no matter what I say, most people will guard their cell phones with their life. They will insist that their phone is absolutely a necessity, and no amount of arguing (logical or otherwise) will dissuade them.


Then again, it's easy to rationalize something you already have. I think the true test is whether you could justify the expense if you didn't already have it.


If you didn't have a cell phone, how would you feel about the expense? If you had the extra $50-100 a month to put against debt or into savings, would you still sign up? Would you really give up $1,200-2,400 you spend in the two years of a contract?


Maybe the answer is yes. I don't know. No one can dictate your priorities. But it is a convenience, make no mistake.


This misconception that people have fostered -- that, for the average person, a cell phone is, anything other than optional -- drives me crazy. It's a luxury, and it's okay to have it. But don't pretend otherwise. Don't talk proudly about how you're cutting down costs by getting rid of the far cheaper option.


Incidentally, two years with a land line will run $360-600. Even if you have to pay to cancel your cell phone, that's a pretty big chunk of change to save.


But I understand that I'm in the minority here. Most people consider their cell phone a life line, if you'll forgive the quasi-pun. So I'm interested in hearing from people who have chosen a cell phone over a land line.


That said, I feel the need to embed this hilariously angry little rant by one Foamy the Squirrel. (If you haven't heard of him, shame on you!)


Caution: The following video has a rather gratuitous amount of swearing!


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16 Comments:

Anonymous Matt SF said...

Ha! I love that vid! Great find! Thanks for the mention and I certainly don't take anything you said as criticism.

Going without a cell phone is certainly doable... I gave mine up in Jan 2006 and couldn't be happier.

I used to take 20 tech service calls a day on mine in my previous road warrior gig, so as you can imagine, I was somewhat motivated to kick the mobile chat & text addiction to the curb.

That said, there are a few vanilla cell phone plans out there (Verizon has one for $39.99 at present, so ~$45 after fees?). Of course, that means no data and text plan, and you use them as they were originally intended in the late 90s/early 2000s... a rationed 10 minute call during the day and maximum radiation dosage after 9pm and weekends.

Lastly, I think the mobile phone is the better choice over a landline. The reason being that it's, well, mobile. I did this in grad school and for a few years later because I thought I was getting more bang for the buck. And boosting my plan from 300 anytime minutes at the time to around 420 was a good over minutes insurance policy.

February 20, 2010 at 9:53 AM

 
Anonymous Kat said...

You're right, I do consider my cell phone to be a lifeline. My cell phone isn't just a phone for me, it is peace of mind. Always having a way to get in touch with someone is great, especially when you are out on the road. One winter, I swerved to avoid a car that pulled out in front of me and ran my car down into a ditch, getting stuck in the snow. I couldn't get out of my car by myself because of the angle, so I was stuck until help came. I don't doubt that somebody would have seen me and stopped and/or called for help...but, oh, how wonderful it was to be able to immediately call 911, AAA, and my boyfriend. That is just one example of a time when having a cell phone has come in extremely handy.

I don't have a land line at home, so my cell phone is it for me. I don't pay for a data plan, just talk and text.

So, no...I don't NEED a cell phone. I could just get a cheap landline. But a cell phone makes a nervous person like me feel so much more comforted while I'm out and about. I'm a worrier, so always having a way to be connected to people while I'm out and about makes me feel more secure. I guess it is kind of how you could argue that nobody NEEDS an iPod Touch, but you have mentioned before how something like that is practically a necessity for your husband, due to his ADD. Well, I consider a cell phone to be a necessity for me.

February 20, 2010 at 10:25 AM

 
Blogger Abigail said...

Kat,

Thanks for writing in with your point of view. Though I actually think it meshes more with mine than you might realize.

My problem, as ever, is with people who swallow an idea whole, rather than chew on it a bit. As I say in the post, I think the real test of whether you NEED something should be whether you could rationalize adding the cost, not whether you can bear to cut it out.

In your case, clearly a cell phone is important enough that you would rationalize adding the cost to your budget. It's necessary for peace of mind, which, in many circumstances, is a category of necessary.

I simply worry when I hear people pronounce cell phones (and data plans) as "necessary" and far cheaper land lines as "unnecessary." Most of us don't need them. And I worry that too many of us simply believe we do because we like them.

I'm always happy to admit that everyone has different priorities and these make the word "necessity" a little vague. I take my satellite TV as an example. Most people could probably get by without it. With an ADD husband and me stuck at home most days, I consider it a necessary luxury.

As I said: My objection is to the lack of thought that gets put into so many decisions in modern life.

February 20, 2010 at 12:09 PM

 
Blogger Abigail said...

Matt,

Glad you liked the video. (Foamy is hilarious and I encourage you to explore more of his stuff. Search for Ill Will Press.)

You're right: Mobile is a great convenience. Tim takes a lot of walks and if I need him for something, I can dial up. But if we had to pay for our own cell phone (we're on my mom's family plan) I'd give up the convenience.

And down here in AZ, there is Cricket which is appallingly cheap. (They have you pay full cost for the phones, so then even with a data plan you're paying under $40 a month.)

Also, I did point out that pre-paid cell phones can be a great (cheaper) safety net. I just get frustrated when people start to buy into the hype. Mobile phones are great, but most of us are always within reach of a land line. (Yet we seem to believe they're headed for the technological graveyard.)

I just get tired of hearing people say they're necessary. They're not. They're a luxury. And people have different priorities. (As I said to Kat, I need the luxury of satellite TV. Others would rather watch Netflix/go to the library and spend on a cell.)

Maybe I'm a luddite, but I just get sick of hearing people buy into the consumeristic culture. Few things are necessary full stop. If cars aren't automatically necessary (that is, for everyone) then I fail to see how a mobile phone is.

I just like people to take responsibility. Things can be important to you, but that doesn't make them actual necessities. That makes them luxuries you're willing to pay for.

February 20, 2010 at 12:16 PM

 
Anonymous Anonymous said...

Here in Northern CA, land line with long distance and voicemail, no other options = $55/month.

MetroPCS unlimited text, data, and talk = $40/month including fees and taxes. You can purchase a phone for as little as $20, one time cost. And NO contract.

It totally depends on the poster's market what makes more financial sense.

February 20, 2010 at 1:59 PM

 
Anonymous Anonymous said...

One thing I notice in posts about phones no one mentions anymore is while it may seem tacky you can get a CB for your vehicle. Truckers still use them and state troopers at least around here monitor channel 9. It isn't glamorous but it does the job.

February 20, 2010 at 3:56 PM

 
Blogger Stargirl said...

I have a magic jack, which cut my phone bills down to $20/year! I love it. All voicemails are emailed to me so I know directly when someone has called (or at least, if they bothered to leave a message). I used to have a cell phone as well: it was a prepaid phone and I paid $25 for three months of service. I only used it for emergencies and the occasional texting. Now that my work is located a mere 5 miles from my apartment, I don't even have a cell phone, but I understand the necessity for some people. But, I sincerely do not understand why someone would pay for a land line when you can just get a magic jack. Unless you're like my parents who live in BFE and cannot get high-speed internet, it just seems like a waste of money to keep a standard land line.

February 20, 2010 at 4:33 PM

 
Anonymous Elizabeth said...

I think the costs vary from city to city, which change how the math works out. When I had a landline in Chicago, if I made NO CALLS AT ALL, my bill was roughly $50-$60/month, same as a basic cell package? The reason - yet again, a huge chunk of that is fees - city, state, 911-charge, who knows what all. At least our city/state/county/other taxing districts realize that taxing telecommunications of any sort - cell or landline - is a way to make everyone pay. Just saying it changes the math, to make having a cell or landline more a matter of preference than one being cheaper. If you want to save on a cell, go with a regular phone, not a smartphone, and don't have a data plan. Want to save even more? Don't have a texting plan and don't text.

February 20, 2010 at 5:52 PM

 
Blogger Abigail said...

Okay, two things:

1. When you folks are quoting what a land line costs, are you talking about a basic package, or a basic line?

Not that it's a huge deal but there is a difference. I ask for the basic line; the rep sells a basic package, usually around $30 a month. I then clarify. I say that I want a phone that rings. That drops the price to $12 a month.

Obviously rates are higher elsewhere, but there still may be a big difference between what you thought was a basic line and what actually is basic.

2. If so much of the cost of the phone packages is from telecommunication fees, would it actually matter whether you had a land line or cell? Wouldn't the fees about the same either way?

In other words, yeah if you're paying $50-60 a month after taxes for a land line and a cell phone plan is $50, that makes sense. But wouldn't the cell phone plan end up significantly higher after all those telecommunication fees hit it? So wouldn't you still be paying more than a land line?

Stargirl,

I'll have to check out the Magic Jack -- although I think some work from home may require that I keep a real, physical telephone line in my house. They also won't accept wireless connections or, I think, wireless headsets. It's all to be sure their customers don't get cut off, I am guessing.

Still, it is something I'll need to investigate!

February 20, 2010 at 6:32 PM

 
Anonymous Anonymous said...

1. Well, if you're talking about a basic line with no calls included, then you're comparing apples and oranges. We used to have a basic line, but it was 40 cents per minute for local calls, and the long distance was outrageous. There was even a charge for using a phone card. Any dialing out was a charge, in other words. So unless you don't want to communicate at all, you're not comparing items that have like benefits if you're comparing a "basic line" to a basic cell phone package as an either/or.

I'm talking about a basic package for a home phone, including the fees and taxes (which by the way are more than twice the fees on cell phone plans here0.

2. No, by far no. The taxes and fees on a cell phone here are completely different than those on a land line. Again, the plan I quoted was $40 per month INCLUDING taxes and fees.

The point being, just because a land line is a better option for some people, you cannot rule out the option of a cell phone penciling out better for every person out there. This is why we need to not have preconceived notions and find out the details of ALL options. Otherwise we can shoot ourselves in the foot.

February 21, 2010 at 9:31 AM

 
Anonymous Abigail said...

Anonymous,

I'm not talking about a basic line with no calls included. In fact, I've never heard of a basic land line with no calls included.

I'm talking about a phone line. It receives calls. It makes calls. It was $12 a month plus taxes. I cannot remember how much it was in DC, but not much more. Long distance was extra.

Even in DC, where almost all my calls were long distance (I was on an internship for the summer), I don't think I paid more than $30-40 a month. In most of the areas I've talked to people about (which is, of course, not every area) you can find a flat-rate long-distance plan for about $20-25 a month. That brings the total for a basic line plus long distance to under $40 a month. For $40 a month with a cell phone, you generally get under 500 minutes a month. That's about 20 minutes per weekday.

Clearly, the area you are in is a special case. Though I would love to know how many minutes you get for $40 a month after taxes/fees. (I know that, down here, Cricket is very cheap. On the other hand, you have to fork over the money for the cell phone. So that does increase the expense, of course.)

Point is, you are right: Preconceived notions are dangerous. That was part of the point of my post. I am sorry if it wasn't clearer. I am sick of people automatically assuming that the best way to cut costs is to cut their land line because they "don't really need it" while they (in most cases) pay significantly more for a phone that they don't generally need.

In most areas of the country, a land line is going to be a significantly cheaper option -- especially for families who are rarely going to get away with less than $60 a month. And that's assuming that they can keep their kids from using the phones to make calls to non-network friends, never text or use data plans.

I will admit that I'm surprised by the fact that ANYWHERE in the country, land lines could be more expensive than cell phones. Even so, my point was more that I was sick of the automatic assumption that cell phones are necessary simply because they are convenient.

That said, I clearly made an assumption myself, that land lines are always cheaper. I did not think it was an assumption, as I've been in three relatively major markets (Seattle, DC, Phoenix) plus Anchorage. But I suppose any generalization is bound to prove wrong somewhere. (And, yes, I'm aware that was a generalization.)

I guess my point is this: If you need a phone rarely enough that a $40/month plan works for you (and you're in a market where that is actually less than a land line), then by all means forgo a land line. My problem, as I have said and perhaps got derailed from, is when people assume that the most convenient option is the most necessary. Especially since convenience often means more money. And people tend to cancel their land lines to "save."

One last time I will point out, I suggested that the real test of an expense is whether you can justify it BEFORE you have it. If you look at the math in your area, clearly you can justify the expense of a cell phone over a land line. So that is, actually, in line with part of my argument in the post. It may simply be a part that got buried.

February 21, 2010 at 11:22 AM

 
Anonymous Elizabeth said...

I understand your post, Abby. Good to think through all costs before you incur them.

$50-$60 is the VERY CHEAPEST you can get a land line at all in Chicago (or at least a couple years ago that was the deal) to have a dial tone when you pick up the phone; this is NOT a package; doesn't include any calls. I actually worked with low-income groups trying to help low-income seniors, and the phone issue is a big problem for them. Yes, this $50-$60 includes the ABILITY to make toll/long distance calls, and you can go slightly cheaper if you don't have that. However, since "toll" calls are based on miles the call must "travel", just calling to another part of the city can be a toll call, and calling my sister in a Chicago suburb was officially "long distance."
The fees for cell phones are also ridiculously high, but are not the same. Ask the state legislature/city/county the reason as I don't know. I do recall that they added the "911-surcharge - I believe $1.75/month - to cell phones sometime after they gained the capability to detect your location when calling on a cell...
Cell phone fees range about $20-$25 per phone. When I had a $39.99 monthly package, my bill was initially around $55 and eventually went up to $65.
My point? Phone service - of any type - is a huge expense in a big city, whether due to distance or fees.
Still the point of the post - to think through every expense first - makes a lot of sense.

February 21, 2010 at 12:15 PM

 
Anonymous Anonymous said...

Like I said, it's unlimited, so there's no "number of minutes."

Unlimited talk, local and long distance in the US (as in, no limit on the minutes, you get as many daytime, night, weekend minutes as you want). Unlimited text, anytime. Unlimited data, anytime.

Including taxes and fees = $40/month. No contract.

It's metropcs.com.

The cheapest phone they have right now is $29.

I know it's belaboring the point now, but you asked about number of minutes, like it would be incredibly limiting.

February 21, 2010 at 5:16 PM

 
Blogger Dory said...

Tom and I haven't had a landline since 2001. And even then, we only had it for two weeks at a house we had just moved into, and when we got our cell phones, we canceled the landline.

We pay about $250/month for two iPhones. I know a lot of people will say that is totally ridiculous. That's for data for both (which AT&T requires with the iPhone and I knew that going in), 1400 peak minutes (I average about 60 of those and Tom uses the rest!), unlimited off peak minutes, unlimited texts. I've tried to get him to use less minutes, not to use his phone for business calls, but that usually gets us into a fight, so I avoid that touchy topic. The next step down from 1400 minutes is 700 minutes and we'd blow that away. I went into my local AT&T store and asked how I could lower my bill. He said with our current usage level, we could bank about 200 rollover minutes a month until we had enough to step down for a couple months and then step back up. He said usually they won't let you do that, but he would arrange it for us.

Being HoH, I hate to take voice calls and would much rather get a text. The time came that I couldn't do voice calls (my hearing loss is degenerative) so we added texting and took off minutes. Tom's minutes were $50 for 1000 minutes and my data only plan was $40. I was texting when it wasn't cool yet (around early 2006). So many of my D/HoH friends have a cell for that reason. At one time, AT&T actually had a plan for these folks that was all data, no voice, for CHEAP but of course they grandfathered it. When I got my hearing aids last year, we changed over to a family plan so I could have voice calls if I felt like it, and the bill skyrocketed.

I know a lot of people would say we're nuts for spending that much on cell phones every month, but I can't imagine NOT having them. When Tom graduates in May, six months later those student loans are going to kick in, and we may have to figure out a way to give them up.

February 21, 2010 at 11:53 PM

 
Blogger SonyaAnn said...

I'm ashamed to say that we have cell phones. Please forgive me! My in laws put us on their plan and I clean their house in trade plus a little more.
Your mom sent me over. When you posted the naughty clip at the end, it made her think of me. I feel loved!

February 22, 2010 at 6:29 PM

 
Anonymous Anonymous said...

I spend $80 to $100 A YEAR on my prepaid cell phone. Although, I got my year card as a gift this past xmas, so I basically have free service until next January. Granted I'm a VERY lite cell phone user. I use my land line as my main phone for $22 a month.

February 24, 2010 at 1:18 PM

 

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