Understanding Your Cell Phone Bill

A cell phone bill seems simple enough. However, there's a lot hidden in the depths of that bill. In fact, it is the most complicated bill you have.

Today, I am going walk you through your cell phone bill so you can understand each part, as well as see what fees you have and what fees are unnecessary. While those fees can add up to a lot of hidden costs, we may just find some potential hidden savings too.

Grab Your Bill

In order to better understand your cell phone bill, grab yours and let’s walk through it together. Typically, on page two of the cell phone bill you will find the breakdown, line-by-line, of each number on the account. What we want to find is the main line (primary phone number) on the plan. For an AT&T customer, your main line may be listed as “AT&T Unlimited Plus Multi Line.” Now, your plan may say 4GB, 10GB, 20GB, or even "unlimited." This is based on the type of plan you have. An unlimited plan can run you upwards of $115 a month as of this writing.

The main line is where you find the “pool” of minutes, texts and data.

There are different plans based on the “pool” you buy. You are basically paying for a pool of texts, minutes, and data; thus, that "pool" equates to your fee each month. Imagine you live in an apartment complex with a community pool. You pay $115 a month to belong. You are, therefore, paying to be part of that "pool" community.  However, more often than not, there is an additional charge per line (roughly $20 per smartphone or $10 per tablet) to have access to swim in that $115 pool community. So, every smartphone and tablet will have to pay that additional, individual fee to even access that pool. Basically, you can’t swim in those waters (even though you pay for them) without paying the additional access fee per month. That can really lead to an inflated bill! Now, let's break down the other details which are mostly fees...

What does Multi-Device Protection Pack Support mean?

This additional fee basically means that if you lose your device, they will help you find it. But, here’s the thing. If you have either an iPhone or Android phone, you can already do that for free! So, why pay for it?

What about insurance?

If you have a $1,000 emergency fund in place, stop paying for insurance now. Invest in a good case, like an OtterBox, to ensure protection of your device, and keep it away from liquids.  And, you can take that risk and absorb the cost of a replacement phone if, God forbid, something happens. Let's talk about that a little more...

Financing Your Device

More often than not, there is a another item on each line, the financing of your phone or tablet. Financing an Apple iPhone can cost $650 to $1000 over 2 years or longer by paying a monthly installment. Often times, the overall out of pocket over that time is more than if you had bought the phone outright. Not to mention, your bill gets inflated with more payments, and if you're a family device payments alone can easily double your overall bill.

Instead, budget for your next phone to ultimately break free of contracted phone payments.

Now, the first time it will cost you outright; however, if you begin to save those payments and budget for that phone, when it comes time to buy one, you will already have that budget in place. And, when it comes time to get that new phone, you can easily sell your old one for more than you would get by turning it in.

A Change In Plans

In the old days, you were locked into a cell phone plan based on the purchase of a plan for so many years. Well, things have changed since the days of plans.

The carrier now locks you in through the phone not the plan.

 To leave a plan, you used to pay a cancellation fee (usually $350) in order to break contract. However, now you are required to pay the remaining balance of your phone in order to end your contract, no matter how much it is.

Other Fees

Administrative fee, telecommunication relay service surcharge, federal universal service charge, regulatory cost recovery charge, 9-1-1 service fee, just to name a few. While you can’t get rid of any of these fees, you do need to be aware of them. The point is…go through your bill because there may be hidden fees in there that could end up saving you money if removed. I have had clients with text message subscriptions, charged by the subscription, up to an additional $15 a month. The texts were free, but the subscription to receive them is not. That's just plain ridiculous!

So, watch out for the little, hidden things in your bill.

In summary, you are paying for a base plan, a fee for each additional device, and a bunch of supplemental fees and services that you just may not need! Be sure to check out my free e-book, “The Money Finder,” to obtain additional tips in combating the unnecessary fees in your cell phone bill. Additionally, look through your cell phone bill and trim the excess fat to reduce your costs, which will inevitably keep your wallet heavy and your heart light.

Question: So, did you find any hidden fees? Any you could get rid of? In the comments below, be sure to share what you found and how much you saved by trimming the fat in your cell phone bill. 

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