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How we each only spend $4 a Month on Cell Phones

July 7, 2013 by Brad 12 Comments  Richmond Savers has partnered with CardRatings for our coverage of credit card products. Richmond Savers and CardRatings may receive a commission from card issuers.

Opinions, reviews, analyses & recommendations are the author’s alone, and have not been reviewed, endorsed or approved by any of these entities. Disclosures.

Laura and I each spend approximately $4 a month on our cell phones for a grand yearly total under $100 combined!  This means we’re paying at least $1,500 less per year than most similar couples who have the latest cutting-edge ‘smart’ phones (“poor phones”?) attached to their bodies at all times.

As you can probably guess, we never got caught up in the craze of texting or checking whatever it is people constantly check on these silly phones that allows them to somehow justify their $70+ per person per month contracts.

Laura stays at home with our daughters where she has a standard phone and a computer when she needs.  I drive to work 10 minutes each way, but otherwise I’m either at home with a phone and computer or at home with a phone and computer at all times.  To imagine that we’d find any value in $1,500 per year cell phones is somewhat laughable.

How Do We Pull it Off?

Even still, how can we each get away with only spending $4 a month on the cell phones that we do have?

After a lot of research, I found the T-Mobile prepaid “Pay as You Go” phone plans have a quirk that enable people like us to benefit greatly.  When you initially sign up, if you put $100 in minutes on the phone you instantly become a “Gold” member for life.  What this means is you get extra value for the minutes you purchase, but most importantly it extends the expiration of those minutes out an entire calendar year from the last purchase.  Here’s what the chart looks like on their site:

1 Year Expiration for Gold Minutes

1 Year Expiration for Gold Minutes

And then every subsequent purchase of minutes, no matter how small, extends all the remaining minutes out an additional year from the last purchase date.

Most people buying these prepaid phones don’t have the money or the know-how to understand the value in just putting $100 on the phone one single time, but if you do grasp it, it can save you lots of money!

So what this means in practical terms is that you sign up on let’s say January 1, 2014 and buy 1,000 minutes for $100; these minutes would normally expire on January 1, 2015.  So anytime before then if you still have additional minutes, you can buy their smallest refill pack for $10 and that extends all the remaining minutes (plus those bought with your $10) out another full year.

So if you spent $10 on December 31, 2014 that would push all your remaining minutes out until December 31, 2015.

In that scenario you would have spent $110 on approximately 1,100 minutes over the course of two full years.  That gives you an average of 46 minutes on the phone each month for an average of $4.60 a month.

Most months we’re each well under that 46 minutes, so that’s where I came up with our $4 per month figure.

Let’s assume now that you know someone who needs a cell phone “for emergencies only.”  It isn’t hard to imagine them spending only $190 over a 10 year period for this phone ($100 initially plus nine renewals of $10 each).  This comes out to $1.58 a month!

We were able to purchase our actual phones at Wal-Mart for about $30 each, but you can certainly buy them on T-Mobile’s website when buying your first $100 of minutes.

Other ways to save on Cell Phones

Important Update: We are now huge fans of Republic Wireless and we highly recommend them! You purchase a smartphone from them for as little as $129 and then it only costs $10 per month for unlimited talk + text + wifi data. You can buy cell data for $7.50 for 500 mb and they REFUND you the amount you don’t use, which is really impressive. Click here to check them out.

FreedomPop and iPod Touch

Though we try to save money where we can, sometimes life intervenes and a new “need” arises where one previously didn’t exist.  Laura recently determined that she really would like to get some type of mobile internet-capable device if the price was right.  After reading this article at Mr. Money Mustache’s site, we looked into buying an iPod Touch and the additional FreedomPop sleeve.

We did wind up pulling the trigger on this, so it cost us just less than $300 total out of pocket as a one-time cost.  This gets us 500mb of data completely free each month; since this is more than we’ll likely ever need we don’t expect to spend one additional dollar on this service.

So for all practical purposes we just bought a fully capable iPhone for a one-time $300 fee.  Even if we say it’ll only last 5 years total, that’s $5 a month for the 60-month period.

With our goal of being frugal but not cheap we determined that this was something Laura placed value on and we didn’t hesitate to buy it.  And in all honesty, it’s been a really useful little device.

So we joined the modern world and saved a ton of money in the long-run, which is comforting!

Republic Wireless:

We are hardly experts on cutting-edge cell phones, but after reading this article on MMM’s site, we can certainly see the value in this $19 a month unlimited plan from Republic Wireless if you use your phone a good bit.  My brother recently purchased this and he’s really pleased with the service so far.

It’s easy for us to get away with our $4 a month cell phones since we largely have no need for them, but for someone who legitimately uses their phones every day, this plan is well worth looking into.

You do need to purchase the phone itself, so that adds to the effective monthly rate, but it’s still a complete bargain as compared with traditional cell phone plans that run upwards of $70 a month.

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Comments

  1. Insourcelife says

    September 16, 2013 at 1:52 pm

    You can get extra 500 mb on FreedomPop through FreedomFriends. Google it and you will find a page on fatwallet.com that explains it step by step. It’s very easy and I now have 1GB of free data per month added to the $10 Airvoice wireless plan on a smartphone I bought used for $50. Also, you use very little minutes so I guess you guys have a landline? If so, that’s an added expense and can be eliminated by getting an ObiTalk VOIP box together with free calls via GoogleTalk. This is the set up that I use and my total monthly expenses are $10 for cell service plus internet. Works great!

    Reply
    • Brad says

      September 17, 2013 at 9:02 pm

      Great suggestions — thank you! I’ll be looking into adding that 500mb through FreedomFriends quite soon; if it’s as easy as you suggest, then that sounds like a can’t-miss upgrade. Our landline is through our Comcast internet and television bundle, so the cost is minimal to zero when factoring in the price of the TV and internet. My wife works from home, so the internet is essential and we haven’t found anything we trust enough to replace Comcast. The day Google Fiber comes to Richmond is the day we cut out our TV, internet and phone bill once and for all. I am constantly looking for ways to do this and thought Aereo might work, but they aren’t in Richmond yet either.

      Reply
  2. scott says

    September 16, 2013 at 8:32 pm

    Republic Wireless is a great alternative for people who want to minimize their phone bill, while also having almost all of the advantages of a “smart” phone. I recently switched from Verizon wireless (my bill was roughly $70 / month for an android device), and now pay only $22 /month for my android Motorola Defy XT device on RW. I decreased my bill by roughly 70%, while only losing a few of the bells and whistles (the biggest being picture messaging, and call quality) that I had with Verizon. I highly suggest RW for anyone who enjoys checking email, listening to pandora, reading the NYtimes, etc., while also saving a boatload of cash per year, as I will save roughly $600 each year.

    Reply
    • Brad says

      September 18, 2013 at 7:47 pm

      I’m glad you’ve had such a positive experience with it! I think my $4 plan works well for people who just don’t use the phone at all, but if you do need it a good bit, it’s almost impossible to beat the Republic Wireless deal…

      Reply
  3. Sandy says

    November 7, 2013 at 7:21 pm

    We were paying around $90/month on two basic phones with a mainstream company. I was working a minimal part time job where my boss required texting but both of our phones just had sliding keyboards. Husband had an additional cell, iphone 5 given to him at work which he can use data for free on the off time and texting is free for him, too. So we switched to Ting. No contracts and I pay for what I use. I did purchase a low level android, touch screen that I own and my monthly fees are around $15 including all fees/taxes. I have talk, text and data in the amounts that I need. I do more texting than anything and I don’t think I’ve used any of the data but I like knowing I have it if the need arises. However, our son is 14 and we’ve held off getting a phone as long as we can…..I’m going to have to look into the freedom pop. I wonder….during the times he near wifi, if the phone will not pull from the freedompop sleeve and switch to the wifi, saving on the data usage.

    Reply
    • Brad says

      November 7, 2013 at 10:39 pm

      That all sounds very reasonable and great that you’ve cut your expenses down so much! I know our method won’t work for many people who need more out of their phones than we do, but for a lot of people who use their phones minimally, the T-Mobile pay as you go method can be a real money saver! Thanks for stopping by and posting such an in-depth comment

      Reply
  4. scott says

    December 31, 2013 at 11:21 am

    In case anyone is interested, here is a link to republic wireless (currently, i’m paying only $25 / month for unlimited text, calls, AND data)!!!

    I just bought a Moto X and it is fantastic!!!

    http://referrals.republicwireless.com/a/clk/1zdn0H

    Reply
    • scott says

      December 31, 2013 at 11:24 am

      If you buy a phone/ plan by using the above link, you will save $19 (not a ton of money, but a penny saved, is a penny earned!)

      Reply
    • Travis says

      April 25, 2016 at 11:26 pm

      Going to try out the republic wireless. Thank you for the suggestions, I am trying to cut expenses as much as possible and cell phone bill is definitely a big one. If I can get it for $25/m that’s saving me over 50 a month.

      Reply
  5. Christina says

    February 8, 2017 at 4:14 pm

    A phone bill that small appeals to many people. It would be interesting to see if it was possible for the average person.

    Reply
  6. Bruce says

    February 12, 2017 at 12:37 am

    We always want to cut off our phone bills. With all the bills that we need to pay at home, being wise enough to choose a better provider for our mobile usage is a must. Thank you so much for sharing this post. This blog really help us out in deciding what service we need to cut of our expenses. Kudos to republic wireless. I just want to know if you also happen to have any idea of other services that can limit home expenses?

    Reply
  7. Heather says

    May 24, 2017 at 4:27 pm

    You can really save a lot by going from contract to prepaid, and it’s such an easy switch! Thanks for sharing!

    Reply

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