Saving Money – Pre-paid Cell Phone

In our continuing quest to reduce costs, we decided to try out a pre-paid cell phone.  We only use one cell phone (for me) and the contract was almost up.  I rarely got close to my minute alloment in any given month, so it seemed like a big waste.  We were paying about $30/month and that was the cheapest plan option we could find.  That annualizes to $360/year for those lacking calculators.

I spent some time researching pre-paid options from the major carriers since coverage was my number one concern.  Why pay any price for a cell phone that won’t work when you need it?  I had always maintained that my cell phone was for emergencies, but I ended up just chatting a fair amount as well.   Sean called me out, though, and challenged me to use it only when necessary to scale back the cost.  We thought the best thing to do was try one out for a few months to make sure that I was willing to live with it for necessity only.  In our area, AT&T gets very good coverage, so we decided to use their GoPhone service.  With AT&T, there are two main options for pre-paid coverage: Pay-As-You-Go Unlimited Talk and Pay-As-You-Go $.25/minute.  The unlimited talk plan has a daily surcharge of $1 on the days you use the phone, and the $.25/minute plan is just like it seems – straightforward.  Since I tend to use the phone sporadically, we decided that the $.25/minute was the best option.

We ended up ordering the phone and a $25 refill minute card online through AT&T’s website.  It was $20 for the phone (free after rebate) and $25 + tax for the minute card.  At the time there was a bonus of $10 when you purchased at least $25 worth of minutes to add to your new phone.  The phone is very basic, which is fine since the goal is to scale back usage anyway.

nokia-2610

So it has been 90 days and I have done very well so far.  I have only used about $11 worth of minutes since early November.  Another nice feature is that you can rollover used minutes if you add new minutes before the old ones expire (does that make sense?).  Since my expiration date was quickly approaching, I just added $100 to my account to extend it for a full year.  I am really pleased with how I was able to cut back on the usage, and subsequently save us around $260/year.  The whole thing worked out so well in fact, that we got one for Sean’s grandmother over Christmas so she will have a phone for emergencies as well.

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