Cell phones

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Do You Really Need It[edit]

It is hard to imagine that not many years ago no one had a cell phone. We tend to think of cell phones as a requirement--something we absolutely have to have. You should consider whether or not you really need to have a cell phone. A basic $40 per month plan will cost you nearly $500 per year. That's $500 that could be put toward savings or something else.

That being said there are quite a few situations where having a cell phone is very important from a safety and time saving standpoint. In the rest of this article we will look at some of the ways you can save money with a cell phone assuming you decide it is a necessity.

Pay As You Go[edit]

Several carriers offer pay-as-you-go plans. Traditionally these have been targeting people with poor credit who can't get accepted by a normal phone plan. However their offerings have grown and often they are very cost competitive with full blown contract plans from major carriers. You can often find unlimited plans in the $50 per month range.

One caveat with these types of plans. They often only work on the provider's primary network. So research where you can make and receive calls from before making the plunge. Sometimes the phones will work on roaming, but at a higher fee. This still may be a good deal particularly if you are just needing a phone for emergencies--just be sure to read the fine print.

The Right Plan[edit]

Cell phone plans are set up to get you to buy more than what you need. The carriers charge very high fees if you go over your minutes in order to encourage you to buy a larger plan. By carefully monitoring your usage you can get a small plan and stay under the limit. Sprint will allow you to purchase additional minutes at a discounted price as long as you do it before the end of the month. This lets you deal with the months you go over without paying ridiculously high fees.

For example, lets say you go over your plan's limit by 100 minutes and your overage charge is $0.40 per minute. Normally this would cost you an extra $40. If you call in Sprint will sell you 100 minutes to add to that month for $5 or $10. If you do it on a regular basis they will suggest that you move to a more expensive plan, but it is ideal for those times where you simply have a busy month. The caveat is that you must watch your cell usage and catch it before the end of the month. Honestly a lot of people don't do that and end up paying the full $40 in this type of situation.


Cell phone providers sometimes have discounts. For example, if you work for the United States Post Office, Sprint will give you a 28% discount. There are a bunch of other affiliations that give you discounts as well. If you work for a big company or university, they may have a negotiated discount. Costco memberships will give you a 23% discount. Spend some time trying to find out exactly what you might be eligible for. Since each carrier has different agreements, you may want to pick your carrier based on the discounted pricing you can get.

Pooling Minutes[edit]

Plans with lots of minutes are cheaper per minute that plans with only a few. Getting 4 or 5 people together on the same plan can be a way to drastically cut your expenses while increasing the number of minutes each person has available. There are several advantages of this type of pooling.

  • Minutes not used by one person can be used by another. With 5 people on a plan, it is likely that each person's busy month will be different so there is some give and take from the allocated minutes.
  • Better pricing by purchasing in bulk. A 1500 minute plan is often only $30 cheaper than a 3000 minute plan.
  • Walking into a store and getting pricing on a large plan with 5 phones on it, may give you some leverage to get certain fees waived as part of the setup. You may also be in a good position to negotiated better pricing on phones.
  • You may be able to find plans that offer unlimited texting or data for cheaper than you could on individual plans.

Of course the downside is that someone has to monitor the usage, collect checks etc. Still it can be an attractive way to lower your costs and increase your minutes or text/data capabilities.