Money Traps
Mobile phones are probably the most marketed product in existence today.
Their advertisements are everywhere, hammering you from every angle
and enticing you with constantly upgraded products and features. And
to make the product even more enticing, they practically give them away
as long as you sign up for a one, two or even three year term. It wasn’t
that long ago that the whole of mankind was able to get by without the
need to be constantly connected to the world, or the need to send a
quick SMS. The power of marketing has us believe that we need to be
connected and to be so, we need the latest in mobile technology.
Millions upon millions of dollars are thrown at you to convince you
that mobile phones are more than just a phone, they are a indispensable
fashion item also. Particularly at risk are the younger generation,
for whom many of the marketing pitches are aimed at and for whom the
newer services offered by mobile phone companies, such as e-mail, games,
internet access, photo messaging and even music and video downloads
are particularly attractive. The obvious problem with all of these services
is that they come at a cost, and it’s all too easy to rack up
some pretty serious mobile phone debts.
The main advantage to mobile phones is the convenience, no matter what
service you’re using – be it a phone call, a SMS, or downloading
your e-mail, and this is where the problem, financially speaking, lies.
The ‘use now, pay later’ mentality is firmly entrenched
in our modern day psyche, so it’s really only in exceptional circumstances
that we’re likely to seriously adjust our habits if we receive
a mobile phone bill that knocks the wind out of us.
If you absolutely must have a mobile phone, there are, as always, ways
to minimise the impact it will have on your finances.
Use a prepaid phone. These are generally cheaper to buy and you are
not locked in to a long term phone contract. This ensures that you only
pay for what you use, and it’s much easier to keep track of your
expenditure. Naturally though your mobile phone charges will only come
down if you actually only use your phone for calls that you really need
to make.
If you must go for a calling plan phone, make sure you choose the right
calling plan for your calling habits and know the rules about when high
peak and low peak calling come into effect. Mobile phone tariffs can
be extremely confusing to decipher, so before signing up for any contract,
carefully consider how many calls you make, what time of day they normally
are, and any other services that you may or may not require. Do not
let yourself get carried away at a salesman’s enthusiasm. If you
are already signed up for a specific contract spend some time to check
whether or not it meets your needs and whether or not you are paying
too much. If you are paying too much, talk to your supplier to see if
you can downgrade your calling plan to something a little more suitable.
With many services where customers are paying more than they need to
for a service, suppliers hope that customer lethargy or ignorance will
keep them paying the higher rate. Make sure you constantly check your
calling plan every few months and see if your carrier has any better
deals available.
Texting, or SMS, is one of the biggest money traps as there is little
concept of spending as money. Simply press the send button and the message
is gone. Get into a conversation with someone like this, and the money
soon starts to add up. Particularly of concern are the amount of television
and radio competitions that invite people to SMS in. The stations receive
a percentage of the revenue the phone company makes, so everybody wins
except the person sending the text.
At the end of the day, a phone is a phone is a phone and if all you
need to do is to make and receive calls, there are some pretty cheap
options available to you. It’s pretty obvious that future generations
of phones will amalgamate many more items into one small handheld package,
and ‘mobile phones’ will be more of a mobile personal computer/entertainment
centre. For now however, mobile phones can be dressed up with cameras,
games, neat software, internet access and the like, but apart from showing
these features off to your peers, the question you need to ask is ‘do
I really need this?’. Financially speaking, if you are having
debt problems and have a mobile phone contract, then this is one of
the first places, if not the first, that you should seriously look at.
Talk may be cheap, but not when using a mobile phone.
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