cell phone

Reasons Not To Have A Cell Phone

January 7, 2011 By Jeffrey Strain 15 Comments

I am probably one of the last people in the US that doesn’t have a cell phone. I don’t have a cell phone to protest in any way. I actually think there are a lot of interesting aspects to them. I have friends that keep telling me that I really need to get one so that it is easier for them to get hold of me. There isn’t an issue with money as I could easily afford one and it would fit into my budget of spending less than I earn. There are a few times a year when I think to myself that it certainly would be more convenient if I had one at that specific moment. The fact remains, however, that each time I have considered getting a phone I realize that I really don’t need or want one.

Over the years, I have gotten better and better at determining between wants and needs. I know this because I buy far less than I used to and find it much more difficult to find true needs. This wasn’t always the case. I was pretty efficient at rationalizing my wants as needs for a period of time. I think this is an issue that many people struggle with, but it certainly is much easier to make the determination between wants and needs when you know what makes you happy.

Getting cell phone isn’t simply a want versus need question in my case. While I do save money not having one and that savings allows me to do an extra week or so of traveling each year, I do have the money to get a cell phone if I want one. With this in mind, whether or not to get a cell phone becomes a question of will a cell phone provide the convenience that would make it worthwhile for me to purchase one? As I mentioned, there are always a few times each year that I think a cell phone would be really convenient (usually when I have planned to meet someone at a certain time and they aren’t there). If I only considered these inconveniences, I would almost certainly get a cell phone.

What keeps me from getting a cell phone is that I know myself well enough to know what would happen if I purchased a cell phone. I spend far too many hours already on the computer and a cell phone would mean that I would simply spend more time with a gadget rather than doing the things that make me happy. The fact is that I am much happier that people can’t call me whenever they want and that increased happiness far outweighs any inconvenience that not having a cell phone causes.

With this in mind and understanding how I would use a cell phone if I had one, I know that not having a cell phone is in my best financial interest. My feeling is that most people do not have a need for a cell phone, but society makes it quite easy for people to pretend that a cell phone is a need rather than a want. It would be very easy for me to justify needing a cell phone even if I didn’t have the money for one. I could argue that I own my own business and it is important for people to be able to get in contact with me (true — I just insist that it be done through email) to claim that a cell phone is a necessity. The fact is that just because I can justify it to others doesn’t mean that it is truly a need.

If you are currently in debt, I think that you should really evaluate your need for a cell phone. Once you determine whether or not it is truly a need, you then need to determine how much you really need to use it (my guess is very little) and the most appropriate cell phone plan for this need. If you aren’t in debt and have the money to afford a cell phone, I think it would be worthwhile to evaluate (much like I did) whether it makes you as happy as you assume it does.

Virtually everyone that I have explained the above of why I don’t have a cell phone thinks that I am absolutely nuts. Even after explaining the exact reasons why I don’t have one, they think that I am trying to make some type of protest, that I am being cheap or that I don’t understand all of the things I can do with a phone (again, one of the main reasons I don’t want one because I don’t want to be playing with it all the time). Despite the shakes of the head and the looks of disapproval, I am confident that I have made the correct decision for me. There may be a time in the future where a cell phone does become a need or a want that is worth paying for, but that is not the case as of this moment.

If you were expecting a list of reasons not to have a cell phone, here are five reasons to give up a cell phone

Think About Keeping Your Landline Phone

October 18, 2010 By Jennifer Derrick 10 Comments

One of the more popular pieces of advice to save money these days is to get rid of your landline phone and rely only on your cell phone. This may work for some people, however it is not something that you should take as gospel without considering your own unique situation first. You may regret your decision if you don’t think it through.

First of all, cell phones are not always cheaper than land lines. Many financial gurus insist that they are, but not always. If you get sucked into an unlimited cell phone plan with data service, you could be paying upwards of $100 per month, whereas a basic landline service might just cost you $20 or so. The question you have to ask yourself is what do you really need? If you make a lot of long distance calls the cell might be cheaper since most plans include long distance with your minutes. However, if you don’t talk a whole lot, the landline is probably the cheaper option. You can use the landline for local calls and get a prepaid cell phone and use it for the few long distance calls you have to make and come out ahead. This is what we do and our total phone bill each month is $25 (for basic landline service and the prepaid cell cost, prorated per month). There’s no way we could get cell phone service that cheap. You need to run the numbers and figure out exactly what you need and decide from there.

There are other situations where keeping the landline might make more sense than going completely cellular. If you have a monitored security system, the landline is the better choice. I’ve spoken with representatives from several security companies and they all say that, while cell phones and security systems can be made to work together, they are not as reliable as hard wired landlines. If you have something similar to Life Alert or other “I’ve fallen and I can’t get up” type of personal protection systems, many of those require landlines as, well. Before you drop your landline, check the requirements and reliability of any services that you are using for security and protection.

Call quality and reliability is another issue. We live in a donut hole between two towers where cell service is flaky. It works, but the quality is lousy. Since I run a business from my home, I can’t be constantly asking clients to repeat themselves because I missed every third world. I also don’t like having to ask friends and family to repeat themselves, either. Before you drop your landline, make certain that you are happy with the call quality and that it is reliably good, no matter the weather or time of day. Cell phones often don’t work in disasters, either. Because we live in a hurricane prone area, we’re better off with a landline. Never has the landline not worked, but the cell phones have failed us.

You may also need a landline if you want to support your home or business with great DSL service. Here, DSL is our best high speed Internet option. However, our carrier (and we have no carrier choice) requires that we keep the landline in order to get DSL. The only other option is satellite Internet or cable, both of which are substantially more than DSL. We need to keep our landline to get the best price on Internet. Our phone and Internet combined is $60 per month. Cable Internet would cost $50 per month, plus we’d still have to do something about a phone. Satellite Internet is $100 per month and by far the costliest option. Keeping our landline saves us money in this case.

Going all cellular might be a good option, but it may not be the cheapest option. There are also other issues besides cost that you should consider before you make the leap. Take your own preferences, needs and lifestyle into account before you decide.

The Financial Benefits of Being a Late Adopter

December 23, 2009 By Jennifer Derrick 7 Comments

I tend to be way behind the technology curve. Heck, I finally got a Wii two months ago, three years after the system came out. It’s not that I don’t like technology; I do and I’m always reading up on new gadgets to see what developments are coming. It’s just that I’ve found that keeping up with the pace of technology is not only exhausting, it’s expensive. Very rarely do I need the latest and greatest of anything so I just sort of hang back until I have a need, or until the product becomes so cost effective (or demonstrates significant value for me) that I can justify the purchase.

Some of my tech-loving friends like to tease me for being so far behind. When I whip out my “new” cell phone, it’s probably the same model they had three years ago. When I rave about a new video game I just discovered, they yawn and tell me they finished that one two years ago. When they see my laptop, they shrug and say, “Well, those features were top of the line last year.” I take the ribbing because I’ve learned that there are benefits to being a late adopter.

The most obvious reason to wait is that the price of all technology comes down as the product ages. The Wii was $249. I waited for the price to drop to $199. I bought a refurbished laptop on Apple that was the prior model for $800 less than the current model was selling for. My cell phone once sold for $100. I got it for $25 on sale after the newer models came out. And so on. I buy almost all of my DVD’s about three to six months after release for less than $10, compared to the new release price of $19.99. Whenever something is new it’s going to cost top dollar. If you just wait a few months, usually the newer and shinier models come out and the old ones are cheaper. Sometimes there’s not even much of a difference in the capabilities of the product, it’s only “defect” is that it’s not the newest model.

Waiting longer also increases the availability of cheaper accessories and components for your tech gadgets. By waiting three years to buy a Wii, I now have a full catalog of older (but still great) game titles to choose from that sell for fifteen to twenty-five dollars, some even less on sale. Those games were once as much as $50 when they were released. And there’s also a big market of used games (the ones my friends played years ago) selling for a lot less than new prices. When I waited to buy my first iPod, I had my pick of cases, headphones, and speaker accessories that weren’t available when it was first released. And because there were so many choices by then, competition had driven the prices down. I don’t have a Blu-Ray player yet, but I’m getting close to pulling the trigger because the prices of the DVD’s are finally coming down and there’s a large catalog of older titles selling for less. There are also more Blu-Ray’s on the used market. The longer you wait, the cheaper it becomes to use and accessorize your gadget.

Not only are things cheaper at full retail price if you wait, but you’ll also find more sales. When there are a lot more products in a given category (games, accessories, TV’s. DVD’s, etc.) the retailers and manufacturers have to do something to make you want to buy their product above the others. So they put things on sale. When there’s only one brand of Blu-Ray player, one brand of LCD TV, or just a few games available for a console there’s no need for sales because the limited supply can dictate a higher price. But when the market is glutted with items and newer ones are coming out every day, there are sales and us late adopters can have our pick.

Late adoption generally means fewer bugs in a product and better support. All the early adopters have already discovered that the new operating system has bugs, or that a certain model of Blu-Ray player freezes during playback. The glitches have been reported to the manufacturer and, ideally, corrected on future releases. Support technicians are better trained once a product has been out a while, too. By the time I get around to buying a product, they’ve seen it all already and any problems I have are quick fixes. There are also larger user groups available to late adopters. When you buy something on the first day, you’re on your own. But wait a while and a quick Google search can yield the answer to your problem because someone out there has already experienced it.

Waiting also means you don’t end up with the product that loses the battle. Remember the battle between Beta, Laserdisc, and VHS? I waited and bought a VHS after the dust settled and didn’t get stuck with players and media that were no longer usable. It’s the same with the recent battle between Blu-Ray and HD DVD. HD lost that one, but some of my “gotta have it on release day” friends sunk hundreds into HD players and discs and are now out that money. I waited and when I finally move to Blu-Ray, I’ll know I bought the winner.

Sure, I may never have the latest and greatest of anything. But I also don’t have the headaches, hassles, and financial losses that sometimes come with being on the cutting edge. Since I rarely need all the bells and whistles of a new model, the older models serve my needs just fine. And my wallet appreciates my restraint.

How to Live on a Single Income

November 5, 2008 By Joe Morgan 11 Comments

I know a lot of people who were asking if it’s possible to live on a single income before the proverbial excrement hit the rotary device, economically speaking. I imagine there are a great many people who are worried about losing their job and are now asking themselves if their household can live on one income if that day should ever come. Well, it can be done, but it takes planning as well as the right lifestyle and temperament to pull it off.

The key to living on a single income is living below your means. Frugality and a debt free lifestyle will make the single income family a reality. I happen to know this first hand. Five years ago, my wife left the work force and gave birth to our first daughter. We had discussed this decision long before having children, and we felt very strongly that having one of us home in the formative years of our child’s life was something we really wanted. The only problem was we hadn’t really planned for a sudden drop in income, much less another mouth to feed.

I thought I made a good salary and I thought it would be no problem. I soon learned that a good salary alone doesn’t make life easy. We found ourselves living on a single income, in a new home with old debts. Car loans, student loans and a $7,000 credit card balance. In fact, we had over $12,000 in “bad” debt (not counting student loans or mortgage). While we were able to live on a single income and get out of debt, but I would strongly recommend eliminating debt before eliminating an income. In the end we’ve had to do a lot of simplifying and sacrificing to pull this off.

“Kill your television” I see these bumper stickers every so often, and it makes me giggle. Of course, the people with the bumper sticker aren’t advocating pulling the plug on the idiot box to save money, but the fact remains that it is a costly distraction. Electricity use aside, most people I know have cable or satellite, high speed Internet and VOIP. We never actually cut the cable out of our lives, but if we had we certainly could have saved over $1,000 a year. We chose not to mostly because having high speed Internet allows me to work from home. Even if you don’t pull the plug entirely, there are other options. Many cable companies now offer some “light” form of high speed Internet access that is cheaper and slower than it’s costly counterpart, but still light years ahead of dial up. Shopping around is a good compromise to going cold turkey.

Cut the cord on wireless: When I first got my present job, I signed up for cell phone service with one of the big carriers. This was stupid. I only needed it for emergencies, and I was locked into a 3-year contract at $85 a month for something I rarely used. After that contract expired (it was too costly to cancel), I switched to a pay as you go service. For about $6 a month I have service that suits my needs.

Forget about designer – skip “new” altogether: Buying second-hand clothes can save a bundle. Let’s face it, most of the cost of clothing is the brand name anyway. I’m not saying you have to go about looking like Jed Clampett from The Beverly Hillbillies, but being thrifty (especially in your casual wear) can certainly go along way in keeping your costs down. If you can’t do without new clothing, consider asking for gift cards and treat yourself to a splurge once in a while.

Clip it, Clip it good: Sorry for the Devo-like heading, but I needed your attention: Clip Coupons. It never ceases to amaze me how many people don’t bother with coupons when grocery shopping. It’s not easy and certainly not most people’s idea of a good time, but my wife routinely saves over $30 per week on our grocery bill, sometimes twice as much. The key is planning meals for the week around what’s on sale and what coupons are available. It takes about an hour on a Sunday morning, but we think it’s worth every penny.

Housing: Don’t buy more house than you can afford. That was pretty obvious, wasn’t it? But many people don’t factor in the cost of living that goes along with a house. Taxes and heating are two of the biggest costs associated with a house that many people overlook. I have a 50 minute commute to work. Many of the people I work with think that’s crazy, but I don’t mind. I get time to myself, and time to unwind after a crazy day at work. I also get a lot more house for my money, since I live out in the “country” and housing prices never got as inflated as they did closer to the urban centers. It also helps that the average income of my town is much less than mine. If I lived closer to work, where the average income is much higher, my salary wouldn’t go nearly as far.

Health costs: Health costs, like education costs, are becoming a bigger problem with every passing year. One thing you can do to limit some of the bite is make use of your employers Flexible Spending Account (FSA). FSAs allow you to have a set amount deducted from your paycheck each pay period before taxes, just like a 401(k). Instead of investing the money though, it goes into an account. When you have a co pay for a Dr’s visit, or just about any other out of pocket health related cost, you can use that tax-free money to pay for it. If your employer doesn’t offer it, pester them until they do.

Income tax: This is one of those areas where a single income by itself actually helps. The more dependents you have, the less you pay. Plus, if those dependents are children , you get a tax credit as well. But one of the biggest moves you can make to lower your income tax bill is to enroll in a 401(k), 403(b), IRA or SEP IRA plan. The contributions you make today are tax free and are removed from your paycheck before state and federal taxes are applied, thus lessening your taxable income. It’s the only way to truly pay yourself first. But the result is twofold: 1) Save for retirement, 2) lowers your tax bill today.

Living on a single income takes determination and planning. It means setting priorities. You need to eliminate as much debt as you can to free up as much of your monthly cash flow as possible. You need to have a clear plan for when and how you can afford to buy the things you consider necessary. In the end though, these are just smart financial moves regardless of your income.