Weekend Project: Saving money by switching to Prepaid

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Goal:

To save money by cutting down on a recurring expense – my monthly cell phone bill – to a prepaid plan without changing my phone number.

Current Annual Cost:

$720

Does it make sense to move to prepaid?

In my case, I hardly go over minutes and usually have unused minutes at the end of the month. I wasn’t in a contract, so no early termination fees. So yeah, if I can keep my phone number, that would make sense.

Research Time:

2 hours

Plans Considered:

AT&T, TMobile, Virgin, Verizon

What I chose:

T-Mobile’s Pay-as-you-go. Here’s why.

  • Allows me to keep my existing phone number
  • I can keep my phone (I’m already on T-Mobile)
  • $100 for 1000 minutes and the minutes don’t expire for a year
  • 15% more bonus minutes when purchasing minutes totalling $100
  • 10 cents a minute, 5 cents receive text, 10 to send
  • No activation charge
  • No roaming charges
  • I can check my minutes and recharge anytime from my phone

More details about the plan

  • Call #999# from your phone to check minutes
  • SMS 7777 with the amount, space, last 4 digits of your cc, to recharge

I’ve been with this plan for a couple of months now and has worked out pretty well so far. I’ll know my total annual savings only after a year, but I can tell it is going to be a lot less than $720! I see $720 as $4725 at the end of 5 years at a modest interest rate of 3%. So yes, that’s a lot of savings assuming I don’t get chatty all of a sudden! :)

As I always say, focus on cutting down recurring expenses first when deciding to cut down on spending. It took me a couple of hours to research on a weekend and a couple of days to get this activated. Was least disruptive and I saved a bundle for my efforts.

photo credit

Evaluate your needs carefully, compare plans (AT&T, Virgin, Verizon are some other carriers that offer prepaid plans) and decide if this is right for you. This will require going over your past bills to estimate what your monthly expense might be with a prepaid plan. Again, the goal is to be comfortable, not miserable. If you love your iPhone, keep it. Maybe there are other areas you can cut down instead (newspaper, magazine etc).

Have a great weekend and happy savings!

9 thoughts on “Weekend Project: Saving money by switching to Prepaid

  1. Weekend Project: Saving money by switching to Prepaid http://bte.tc/cVUs #RTW

  2. Weekend Project: Saving money by switching to Prepaid http://bte.tc/cVUs #RTW

  3. Weekend Project: Saving money by switching to Prepaid http://bte.tc/cVUs #RTW

  4. Weekend Project: Saving money by switching to Prepaid http://bte.tc/cVUs #RTW

  5. Weekend Project: Saving money by switching to Prepaid http://bte.tc/cVUs #RTW

  6. Weekend Project: Saving money by switching to Prepaid http://bte.tc/cVUs #RTW

  7. Weekend Project: Saving money by switching to Prepaid http://bte.tc/cVUs #RTW

  8. Weekend Project: Saving money by switching to Prepaid http://bte.tc/cVUs #RTW

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