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Introducing Coverage Critic: Time to Kill the $80 Mobile Phone Bill Forever

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A Quick Foreword: Although the world is still in Pandemic mode, we are shifting gears back to personal finance mode here at MMM. Partly because we could all use a distraction right now, and even more important because forced time off like this is the ideal time to re-invest in optimizing parts of your life such as your fitness, food and finances.

Canadian Readers – we have also collected some recommendations for you at a new Canadian Mobile Phone recommendations page.

Every now and then, I learn to my horror that some people are still paying preposterous amounts for mobile phone service, so I write another article about it.

If we are lucky, a solid number of people make the switch and enjoy increased prosperity, but everyone who didn’t happen to read that article goes on paying and paying, and I see it in the case studies that people email me when looking for advice. Lines like this in their budget:

  • mobile phone service (2 people): $160

“NO!!!!”
is all I can say, when I see such unnecessary expenditure. These days, a great nationwide phone service plan costs between and $10-40 per month, depending on how many frills you need.

Why is this a big deal? Just because of this simple fact:

  • Cutting $100 per month from your budget becomes a $17,000 boost to your wealth every ten years.

And today’s $10-40 phone plans are just great. Anything more than that is just a plain old ripoff, end of story. Just as any phone more expensive than $200* (yes, that includes all new iPhones), is probably a waste of money too.

So today, we are going to take the next step: assigning a permanent inner-circle Mustachian expert to monitor the ever-improving cell phone market, and dispense the latest advice as appropriate. And I happen to know just the guy:

Christian Smith, along with colleagues at GiveWell in San Francisco, circa 2016

My first contact with Chris was in 2016 when he was working with GiveWell, a super-efficient charitable organization that often tops the list for people looking to maximize the impact of their giving.

But much to my surprise, he showed up in my own HQ coworking space in 2018, and I noticed he was a bit of a mobile phone research addict. He had started an intriguing website called Coverage Critic, and started methodically reviewing every phone plan (and even many handsets) he could get his hands on, and I liked the thorough and open way in which he did it.

This was ideal for me, because frankly I don’t have time to keep pace with ongoing changes in the marketplace. I may be an expert on construction and energy consumption, but I defer to my friend Ben when I have questions about fixing cars, Brandon when I need advice on credit cards, HQ member Dr. D for insider perspectives on the life of a doctor and the medical industry, and now Chris can take on the mobile phone world.

So we decided to team up: Chris will maintain his own list of the best cheap mobile phone plans on a new Coverage Critic page here on MMM. He gets the benefit of more people enjoying his work, and I get the benefit of more useful information on my site. And if it goes well, it will generate savings for you and eventual referral income for us (more on that at the bottom of this article).

So to complete this introduction, I will hand the keyboard over to the man himself.

Meet The Coverage Critic

Chris, engaged in some recent Coverage Criticicism at MMM-HQ

I started my professional life working on cost-effectiveness models for the charity evaluator GiveWell. (The organization is awesome; see MMM’s earlier post.) When I was ready for a career change, I figured I’d like to combine my analytical nature with my knack for cutting through bullshit. That quickly led me to the cell phone industry.

So about a year ago, I created a site called Coverage Critic in the hopes of meeting a need that was being overlooked: detailed mobile phone service reviews, without the common problem of bias due to undisclosed financial arrangements between the phone company and the reviewer.

What’s the Problem with the Cell Phone Industry?

Somehow, every mobile phone network in the U.S. claims to offer the best service. And each network can back up its claims by referencing third-party evaluations. 

How is that possible? Bad financial incentives.

Each network wants to claim it is great. Network operators are willing to pay to license reviewers’ “awards”. Consequently, money-hungry reviewers give awards to undeserving, mediocre networks.

On top of this, many phone companies have whipped up combinations of confusing plans, convoluted prices, and misleading claims. Just a few examples:

  • Coverage maps continue to be wildly inaccurate.
  • Many carriers offer “unlimited” plans that have limits.
  • All of the major U.S. network operators are overhyping next-generation, 5G technologies. AT&T has even started tricking its subscribers by renaming some of its 4G service “5GE.”

However, with enough research and shoveling, I believe it becomes clear which phone companies and plans offer the best bang for the buck.  So going forward, MMM and I will be collaborating to share recommended phone plans right here on his website, and adding an automated plan finder tool soon afterwards. I think you’ll find that there are a lot of great, budget-friendly options on the market.

A Few Quick Examples:

Mint Mobile: unlimited minutes, unlimited texts, and 8GB of data for as low as $20 per month (runs over T-Mobile’s network).

T-Mobile Connect: unlimited minutes and texts with 2GB of data for $15 per month.

Xfinity Mobile: 5 lines with unlimited minutes, unlimited texts, and 10GB of shared data over Verizon’s network for about $12 per line each month (heads up: only Xfinity Internet customers are eligible, and the bring-your-own-device program is somewhat restrictive).

Total Wireless: 4 lines in a combined family plan with unlimited calling, texting, and 100GB of shared data(!) for $100 per month (runs on Verizon’s extensive network).

Ting: Limited use family plans for under $15 per line each month.

[MMM note – even as a frequent traveler, serious techie and a “professional blogger”, I rarely use more than 1GB each month on my own Google Fi plan ($20 base cost plus data, then $15 for each additional family member). So some of these are indeed generous plans]

Okay, What About Phones?

With the above carriers, you may be able to bring your existing phone. But if you need a new one, there are some damn good, low-cost options these days. The Moto G7 Play is only $200 and offers outstanding performance despite the low price point. I use it as my personal phone and love it.

If you really want something fancy, consider the Google Pixel 3a or the recently released, second-generation iPhone SE. Both of these are amazing phones and about half as expensive as an iPhone 11.

——————————————-

Mobile Phone Service 101

If you’re looking to save on cell phone service, it’s helpful to have a basic understanding of the industry. For the sake of brevity, I’m going to skip over a lot of nuances in the rest of this post. If you’re a nerd like me and want more technical details, check out my longer, drier article that goes into more depth.

The Wireless Market

There are only four nationwide networks in the U.S. (soon to be three thanks to a merger between T-Mobile and Sprint). They vary in the extent of their coverage:

  • Verizon (most coverage)
  • AT&T (2nd best coverage)
  • T-Mobile (3rd best coverage)
  • Sprint (worst coverage)

Not everyone needs the most  coverage. All four nationwide networks typically offer solid coverage in densely populated areas. Coverage should be a bigger concern for people who regularly find themselves deep in the mountains or cornfields.

While there are only four nationwide networks, there are dozens of carriers offering cell phone service to consumers – offering vastly different pricing and customer service experiences.

Expensive services running over a given network will tend to offer better customer service, more roaming coverage, and better priority during periods of congestion than low-cost carriers using the same network. That said, many people won’t even notice a difference between low-cost and high-cost carriers using the same network.

 For most people, the easiest way to figure out whether a low-cost carrier will provide a good experience is to just try one. You can typically sign up for these services without a long-term commitment. If you have a good initial experience with a budget-friendly carrier, you can stick with it and save substantially month after month.

With a good carrier, a budget-friendly phone, and a bit of effort to limit data use, most people can have a great cellular experience while saving a bunch of money.

MMM’s Conclusion

From now on, you can check in on the Coverage Critic’s recommendations at mrmoneymustache.com/coveragecritic, and he will also be issuing occasional clever or wry commentary on Twitter at @Coverage_Critic.

Thanks for joining the team, Chris!

*okay, special exception if you use it for work in video or photography. I paid $299 a year ago for my stupendously fancy Google Pixel 3a phone.. but only because I run this blog and the extra spending is justified by the better camera.

The Full Disclosure: whenever possible, we have signed this blog up for referral programs with any recommended companies that offer them, so we may receive a commission if you sign up for a plan using our research. We aim to avoid letting income (or lack thereof) affect our recommendations, but we still want to be upfront about everything so you can judge for yourself. Specific details about these referral programs is shared on the CC transparency page. MMM explains more about how he handles affiliate arrangements here.



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Finance

8 Best Budgeting and Personal Finance Tools

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Taking control of your personal finances is simple in theory. But if you’re struggling with budgeting, saving, or investing, trying a new tool may be the ticket to making better decisions and improving your success.

Here are eight of the best personal finance tools to make sense of your money, stay organized, and achieve your financial goals.

8 Best Budgeting and Personal Finance Tools

Keep reading to learn more about each of these budgeting and personal finance tools.

1. Quicken

Quicken has been around a long time and is considered the gold standard in personal finance software. They have a suite of products that connect to multiple types of accounts, such as banks, credit cards, lenders, and investments, to aggregate your transactions.

Like many companies, they’ve moved to a subscription model where you pay an annual fee and get automatic updates for new features and services.

The Starter version gives you a lot, including automatic expense categorization, limited budget tracking, and a bill dashboard, for $35 per year. Upgrading to Deluxe ($50) or Premier ($75) gives you the Starter features plus customizable budgeting, loan tracking, investment tracking and analysis, bill pay, and online backup.

Quicken has far more features than I’ll ever use, but it’s my favorite way to manage money.

You can use Quicken on your PC or Mac, but PC users can also get a Home & Business version for $100 per year. It helps you manage a small business or freelance work by separating personal and business expenses, emailing custom invoices with payment links, and tracking business tax deductions.

You can enter transactions manually into Quicken if you don’t want to connect to your financial accounts online. And there are Quicken mobile apps to sync up with your desktop version, although you can’t see all your data.

Quicken has far more features than I’ll ever use, but it’s my favorite way to manage money. Every week I import new transactions and make sure they’re categorized correctly, especially those related to taxes, so I can easily create reports at tax time.

2. Mint

Mint is one of the original web-based personal finance management programs. It’s free to sign up and connect your financial accounts, such as a bank, credit card, loans, and investments through an easy-to-use dashboard.  

The Mint mobile app has a lot of functionality, allowing you to check account balances and monthly budgets.

Once Mint…

Keep reading on Quick and Dirty Tips



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Future inheritance.. need help!

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Hey all, i’m a 22yr old living in the US. I’ll start off by saying that I have no current debt, credit score is 785, currently don’t have a job and don’t have much saved.

This might be long but i’ll try to make this as short as I can. I’ve lived with my mom, lil brother, and grandparents pretty much my whole life. Mom had a very bad drug addiction, decided to move out with my girlfriend when I was 18. The following year my mother happens to pass due to overdose, she didn’t have any money to her name so no assets were given. 3 months later my grandma passed away from lung cancer and all her assets were transferred to my grandpa. My grandpa had throat cancer 10 years ago and had to get his voice box removed, so now he breathes through his neck stoma. My girlfriend and I decided to move back home a few years ago to help support and take care of my grandpa (pretty much his care taker) and my little brother (his dad is barely in his life). As time has progressed, my grandpa is having breathing issues and can’t get around as easy anymore. I’m now worried that something will happen in the near future and i’m a little lost when it comes to the assets he has.

My grandpa has a will set up for me and my brother to split everything 50/50 and I’m the primary beneficiary, he said that I will have control of his part of the assets until he is 21 (he’s 14 now). Paperwork and everything is already signed. He will be passing on the house that we currently live in and all of his stocks.

The mortgage for the house is paid off, and there are two IRA accounts. The house is worth about $400,000. I believe the first is a traditional IRA with a little over $300,000 in it. The second is an IRA Roth with about $100,000. We have a “money manager” through JP Morgan who manages all of the stocks, and my grandpa has it set up so that he receives $1,000 a month from it.

Now I have multiple questions. I know the market is up and down everyday, but say that the current assets were to be passed on..

• Will I take over his current IRA accounts or will I have to create my own and transfer the funds to that?

• Do I have to withdraw the money by a certain time point or can I just let it sit?

• When filing taxes at the end of the year, will I owe anything since I would be coming into a lump some of money?

• How much would be taken out in taxes when it is distributed to us?

• When filing taxes at the end of the year, will I owe anything since I would be coming into a lump some of money? Also what tax bracket would I be in?

• Should I keep the money manager and keep the current ways that my grandpa has set up?

• My brother and I have agreed to keep the house but we would like to renovate it when the time comes. Say the renovation will cost $50,000. Would I take $64,000 out of the traditional IRA (withhold $14,000 for taxes) or take the money out of the IRA roth so it’s tax free?

I know this is quite a bit and I feel as if I have a huge weight on my shoulders, but i’m trying to have a better understanding of how this works..

Thanks to all in advance!

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Why Save Money Now? 9 Reasons That Will Help You Start Saving

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Learning to save money is one of the best things you can do for yourself. 

Saving money can help you prepare for emergencies, start a business, retire, and more.

Financial security is one of the best reasons for why you should save money, and being prepared financially is one of the best feelings in the world. You can travel more, pursue your passions, quit a job you don’t love, try new things, and more.

But, I hear over and over again from people that they don’t want to save money now because they think they have the rest of their life to do so.

However, that’s far from true, especially if you want to be prepared for emergencies or retire.

When you decide to start saving money now, you will be ready to live the rest of your life. 

You can take chances, try new things, and be ready in case something awful were to happen. Saving money gives you the freedom to worry less and live more.

Now, there are some situations when people do have a harder time saving money. Maybe you are living paycheck to paycheck, are working to eliminate high amounts of debt, etc. 

Even though learning to save money can be hard, small amounts of money add up over time, and this is very true when you start now. Plus, there are lots of great ways to make extra money to make saving now easier.

Saving money takes discipline and some people may need to take extreme measures, but starting to save money now is one of the best things you can do for yourself.

Related content:

Below is why you should save money even if you think you have the rest of your life to do so.

 

Learning a good savings routine now will help you later.

One of the top reasons for why many don’t start saving now and/or invest for retirement is because they claim that they don’t know how. Yes, it might feel overwhelming in the beginning – how to start investing, where to save your money, etc. But, these are things you can learn so it doesn’t have to be hard.

Once you get over the hump of getting started, you can create a routine where you regularly make contributions to a savings account or a retirement account. There are even investing and savings apps available to automate the process for you.

Acorns is a popular micro investing app that you can use to schedule deposits into your investment account – even just $5 at a time. You can also set up Acorns to round up transactions from a linked card to invest passively.

However you start to save and invest now and the sooner you do it, the more it becomes a habit and the easier it will become. By saving money as soon as you can, you will learn good financial habits that will help you well into the future.

Learn how to start investing at How To Start Investing With Little Money

 

You don’t need as much money as you think.

More and more people are choosing to live a minimalist lifestyle because they have realized that less is more. These people are living in smaller houses, not buying as much stuff, and being more thoughtful when they do make purchases.

These choices can lead to significantly spending less money on things, which makes it easier to save your money.

Now, leading a minimalist lifestyle isn’t for everyone. But, material items do not always equal happiness. Sometimes they just add stress, debt, and more. Think about it – the more stuff you have, the more likely that something will break, something will get lost or tossed to the side, and so on.

And if you think about the fact that the average household has 300,000 items (not a typo), that’s a lot of money spent on stuff.

However, do we actually need all of that stuff?

Probably not.

Spending money on a bunch of unnecessary stuff does not mean that you will have a higher level of happiness than someone else.

When you learn to live with less, you will find that you don’t need as much money as you thought.

Related: How A Minimalist Lifestyle Can Bring You Happiness 

 

An enjoyable life doesn’t have to be expensive.

One of the other things I hear about saving money is that it’s boring.

Yes, I have heard that if you are saving your money that you’re having no fun. In fact, here are a few myths I’ve heard about saving:

  • “I can’t save money because that means I’ll just be eating rice and beans and sitting on my couch all day long.”
  • “That person is only able to save money because they have a boring life.”
  • “I’d rather enjoy my life now and worry about saving money when I’m old.”

These are not true, at all. You know what they say when a person complains about being bored – that they are actually a boring person.

If you think spending money rather than saving money will lead to happiness, then you need to change your mindset.

Life is all about a comfortable balance. You can save money, spend money, and have an enjoyable life. It’s not one or the other. And, really, it’s all about knowing what you can actually afford and thinking about whether buying something will actually benefit your life.

There are plenty of ways to live an awesome life while saving money. Yes, you can still see your friends, have fun with your loved ones, go on vacations, and more, all while staying on a realistic budget.

Instead of going out to eat three to four times a week, you can prepare meals with friends or family or host a potluck.

Instead of taking an expensive vacation, you can do a roadtrip or plan a staycation.

Instead of spending lots of money on an expensive weekend out with your friends or significant other, you can go for a hike, bike ride, and more.

There are so many ways to have fun for free or cheap, and finding new ideas now can help you start to save money.

Related: 

 

Compound interest matters.

Learning how to save your money is a wonderful thing, especially if you start investing. When it comes to investing, time is on your side because of the powerful impact of compound interest.

Compound interest is one important reason for why you should start to save your money now instead of waiting until you are older.

To put it simply, compound interest is when your interest is earning interest. This can then turn the amount of money you have saved into a much larger amount years later.

This is important to note because of inflation – $100 today will not be worth $100 in the future if you just let it sit under a mattress or in a checking account. However, if you invest, you can actually turn your $100 into something more. Investing for the long term means your money is working for you, potentially earning you an income.

For example: If you put $1,000 into a retirement account that has an annual 8% return, 40 years later that would turn into $21,724. If you started with that same $1,000 and put an extra $1,000 in it for the next 40 years at an annual 8% return, that would then turn into $301,505. If you started with $10,000 and put an extra $10,000 in it for the next 40 years at that same percentage rate, that would then turn into $3,015,055.

Side note: I recommend you check out Personal Capital if you are interested in gaining control of your financial situation. Personal Capital is similar to Mint.com, but much better. Personal Capital is free and it allows you to aggregate your financial accounts so that you can easily see your whole financial situation, including investments.

Related content:

 

There’s no need to waste money just because you can.

There is no reason to spend all of your money just because you are able to. In my opinion, finding ways to save money will bring you greater security and peace of mind.

I’ve heard of people (even many who are close to me) say, “If I have money, I’ll spend all of it.”

If you decided to save your money rather than spend the last bits of it until your next paycheck, you will be on the road to saving more in the long run, meaning you can start to break free from a paycheck to paycheck lifestyle.

Even if you are only able to save a small amount, that is much better than not saving anything.

Like I said above, time and compound interest are both on your side, and this can turn the small amount of money you have saved into a much larger amount.

Related: 16 Alternatives To Cable TV That WILL Save You Money

 

Stop letting others dictate how you live your life.

One of the reasons that people spend more than they should (and save less now) is because it looks like that is what everyone else is doing.

We’ve all seen the pictures on Facebook or Instagram of a friend with their brand new car, someone on an amazing vacation, or in brand new clothes. But, just because other people have something, that doesn’t mean you need to as well.

You have no idea how someone paid for those things. Maybe they make more than you think, maybe it was a gift, or maybe they are going into debt to “afford” things.

You are the only one who gets to dictate how to spend your money. And you can choose to save instead of spending money on things to keep up with others.

In 10, 20, 30, or 40 years, you could be living a comfortable life without debt, not stuck in a job you hate, and be pursuing your passions. Doesn’t that sound so much better than a life of debt and comparison?

 

The less money you spend now, the less you need in the future.

By spending less money, you’ll decrease the amount of money you need in the future. This includes money for emergency funds, retirement, and more.

This will help you build your emergency fund quicker and reach retirement sooner.

Just think about it: If you are already living a frugal lifestyle, then you will be used to living on less in the future. This means your retirement savings doesn’t need to be as large, which means it may be easier to reach that savings goal.

Also, if you spend less money, you probably won’t need as much in your emergency fund, which can also help you fund that sooner!

When you spend less money now, you can save at a higher rate, and that means you can reach your goals that much faster!

For example, Mr. Money Mustache has a great graphic in his blog post The Shockingly Simple Math Behind Early Retirement that shows you how your savings rate can dramatically impact when you’ll retire. For example:

  • Saving at the average personal savings rate of 5%, it will take you 66 working years until you reach retirement.
  • A 25% savings rate means it will take you 32 working years to retire.
  • A 50% savings rate means it will take you 17 working years to retire.
  • A 75% savings rate means it will take you 7 working years to retire.

So, by saving more of your money, you are likely to retire sooner. Sounds amazing, right?

 

There’s no guarantee that you’ll always have that income stream.

Time and time again, I hear from people that say they don’t need to save money now because they have a job.

Yes, you may feel safe and secure in your job, but the truth is that you never really know how long you’ll be making money or how long that job will last.

Many other people think, “But, I enjoy my job!”

While it’s great that you enjoy your job, you should still learn to save your money. Too many people think they can work forever because they love their job.

However, what happens when you can no longer work? You don’t know what the future will bring – you may encounter a medical problem, a serious life event, you may hate your job 20 years from now, and so on.

Why do people save money? One reason is because nothing is guaranteed.

So, instead of spending every last penny that you have, you should find ways to save more money.

Related: 12 Passive Income Ideas That Will Let You Enjoy Life More

 

 

The best things in life are free.

Stop for a second and think about your life. Do you have a friend you can count on? A family member who cares for you? A significant other to share your life with? Did a stranger hold the door open or offer you a smile? None of those things cost a dime.

Even if you just have one of these, you are still experiencing the happiness in life that comes free of charge.

There are so many free things in life to enjoy!

There are libraries, parks, free concerts, music on the radio, and more.

All of these amazing free things mean that you can stop spending as much and start to save money now.

Living a frugal life means you are taking advantage of what’s already around you. For some, this can be a hard mindset to get into, but when you realize you already have the most important things in life, you will realize that money isn’t the be all and end all.

There are many reasons to save money, and it’s never too late to start.

 

Starting to save money now will change your life.

Saving money is a mindset that you have to put yourself into. You have to make routines, make sacrifices, and change the way you spend money.

I know all of that is hard to do, but there is no greater feeling than being prepared.

And please don’t think that it’s too late to start saving. It’s never too late!

By learning to save at any age or stage of your life, you are making one of the smartest decisions you can for your future, even just a month or five years down the line.

What do you think? Do you think you should save money now? Or enjoy life and save later?

The post Why Save Money Now? 9 Reasons That Will Help You Start Saving appeared first on Making Sense Of Cents.



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