12 Jul 2005

Is Your Cell Phone Plan Meeting Your Needs?

Can't make heads or tails of your monthly cell phone bill? Chances are you haven't thought about the details of your cell phone plan since you first signed up. If your cellular calling needs have changed since then, it makes sense to reconsider your service plan. If you are happy with the quality of your service and don't want to switch carriers, you might even be able to upgrade your cell phone plan with your existing carrier without penalty in the middle of your contract.

If you're routinely going over your minutes, it makes less sense to curtail the time you spend on the phone than it would simply to switch to a more cost-effective cell phone plan with more minutes. Understanding how and why you're being billed additional charges will help you determine if it's time to upgrade to a new plan. And with number portability in effect, switching to a new carrier with a new plan and more minutes is easier than ever.

On the other hand, if the time you spend on your cell phone consistently falls way below your monthly plan minutes, perhaps it makes sense to opt for a cheaper cell phone plan. (Be aware, however, that if your cell phone plan is new, downgrading during the first year of your contract can lead to penalties both from the carrier and the authorized agent where you bought your discounted cell phone.)

Finally, it might be worth noting that cell phone plans have continued to get better each year. The ideal cell phone plan of 2 or 3 years ago might be an inferior value when compared to the new plans being offered with today's cell phones. It's worth doing a checkup to compare your old plan to the newest plans; and don't forget to calculate into the equation things like free long distance, free mobile-to-mobile, rollover minutes, and text and picture messaging, other freebies that might not have been included in your old cell phone plan. Odds are you'll save money or get additional freebies if you switch carriers.

Here are explanations of the most common terms used in distinguishing cell phone plans:

Peak Time

This refers either to the period of heaviest traffic on the network or to calls made during this period. A cell phone company's various cell phone plans are usually distinguished by how many peak minutes are included with the flat monthly rate before additional per-minute charges apply. Peak calling time is usually defined as Monday through Friday, early morning until around 8:00 or 9:00 p.m. The actual window varies not only from carrier to carrier, but also plan by plan and city by city. Check other carriers' cell phone plan options to see if an extra couple hours of off-peak talk time a week could help you save money.

Off-Peak Time

Off-peak time is the periods of time during which carriers offer discounted airtime charges. Most cell phone plans include an unlimited or very generous amount of off-peak talk time. Each carrier designates its own off-peak hours, usually after normal business hours during the week, and weekends. Some cell phone plans allow you to add "extended off-peak time" for a small fee. This decreases the window during which higher per-minute (peak) rates apply.

Mobile-to-Mobile (or In-Network)

Most cell phone plans allow for unlimited mobile-to-mobile calling, which are calls made to other customers of the same cell phone company. These calls don't count against your cell phone plan's talk time limit. Since most people spend the majority of their time talking to a limited group of people, unlimited mobile-to-mobile is a great deal when the majority of your friends and family use the same service provider. All things being equal, it would be worth switching to the cell phone company used by the majority of your contacts if you could get a plan where you paid for fewer minutes.

Long Distance

How your cell phone company defines "long distance" might depend on whether you have a local plan, a regional plan, or a nationwide cell phone plan. Most cell phone plans nowadays include free long distance. That means that you don't pay extra per minute to call across the country, the way you would with a traditional land-based phone; however, the minutes still count against your monthly limit. Any long-distance calls you make beyond your cell phone plan's allotted time will incur overage charges.

Roaming

Roaming is when you use your cellular phone outside your usual service area, when traveling outside of the "home" service area defined by a service provider. It is also considered roaming when your cell phone company does not have service in a particular location and your phone call is handed off to another carrier. Cell phone companies have roaming agreements with other companies so you are not stuck without service in spots where one company's reception might be weak.

Many nationwide cell phone plans include free roaming. If they don't, then higher per-minute rates are usually charged for calls made or received while roaming. Long distance rates and other fees may also apply while roaming, even if calls are made during off-peak hours or within the company's network.

Your cell phone's display will usually indicate when you are roaming so that you know if your call may be incurring additional charges due to roaming. If your current plan doesn't include free roaming, see if you can find one for the same price that does include this feature.

Shared Minutes

Under a shared cell phone plan, sometimes called a family plan, two or more individuals share a common pool of minutes under a single phone bill. This simply means that the cell phone plan's allotment of talk time can be used by members of the plan in any proportion, as long as the group collectively doesn't go over the limit of pooled minutes. Shared cell phone plans are a good way to make use of infrequent callers' unused minutes.

If two members of your household are on two different cell phone plans, combining your accounts into a shared plan can be very cost effective because you keep your two phones but are only paying for one plan. You can add a second line onto an existing plan for as little as $10 a month, a fourth of the cost of an individual plan. Family plans are explained in more detailed in the Point.com article: "Cell Phone Family Plans".

The combined savings of switching to a family plan are one of the most popular reasons given for switching cell phone plans. Whether your family was previously all with one carrier on different accounts, or you were using different service, you should consider the benefits of sharing your minutes on a new shared cell phone plan.

Data Services

For newer, data-capable cell phones, you will need to purchase additional services to access the Web and/or send text or picture messages. Depending on your cell phone plan, you may purchase messaging bundles that allow you a set number of data transfers (just like your cell phone plan lets you buy bundles of talk time minutes), or you may pay for text and multimedia messages on a per-message basis. Time spent online while transferring data may or may not count against your allotment of talk time. In any case, today's plans will most likely have more generous provisions for data charges.

Switching Cell Phone Plans

When it comes to picking a cell phone plan, there are two important things to keep in mind. One is that the definition and details of your charges vary based on your carrier and your particular cell phone plan. That means you might be comparing apples and oranges when you make don't pay attention to when your peak time starts and ends. The second is that cell phone providers often introduce new plans. So while your current plan might have been perfect a couple of years ago, it may no longer be the best cell phone service plan available to you today.

Not reassessing your cell phone plan when your usage changes could lead to bills that are triple, quadruple or even more than what you thought you signed up for. On the other hand, switching to a new cell phone plan could result in substantial savings. It's worth looking into.

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