This Week In Your Wallet: Verizon’s Move & The Real Value Of $100
Last Thursday, Verizon, the nation’s largest wireless company, eliminated two-year service contracts for all new customers. Oh, and scratched the practice of selling discounted phones. (That’s right, no more $299 latest gen iPhones.) It’s clearly the way of the future. T-Mobile was the first company to do this two years ago, and while AT&T still offers contracts, they’re also pushing a BYOD — that would be Bring Your Own Device — plan.
If you’re a current Verizon customer, you can choose to remain on your plan. Do nothing and you’ll keep paying what you’re paying now. The company will sell you another subsidized phone for your next go round. But if you decide at the end of your contract to switch to the new wireless plan (which is what I’ll be doing) you should know there’s no going back. And if you’re a new Verizon customer, you have no choice — you’ll automatically be enrolled in the pay-as-you-go plan. Under the new rules, there will be three things you need to buy: a phone, a data plan and an access line (or lines, depending on family and friends). Here’s what you need to know about each:
- Phone: You’ll either buy your phone outright or through monthly installments and pay the full price. Think $600 to $700 for a top of the line model — not the $200 (or less) that we’re used to paying at subsidized rates.
- Data plan: You’ll order from a menu that sounds like you’re buying a T-shirt: Small (up to 1 gigabyte of data) is $30 a month; medium (3GB) is $40; large (6GB) is $60 and extra large (12GB) is $80.
- Access line: Connecting a single phone on Verizon costs $20 once your contract is up, $40 before then (because you bought your phone at a subsidized price).
Will this move save you money? Generally yes. If you compare the cost of a 2GB two-year contract to the similar offering from the new menu (including a new phone) you’ll save about $3 a month ($70 over the two years) and get an extra gig of data each month. But the real savings comes for people who are willing to hold onto their phones longer. If you hold onto your phone after the end of your contract and switch to the new plan, the savings on the access charges alone put an annual $240 in your pocket. (Until, of course, you have to buy a new device. Then the amortization process starts all over again.) Check out my segment last week — and continue reading on Today.com — to see how.
Call Hotels For Cheaper Rates
For your future hotel bookings, I came across this piece on PureWow on how to score a cheaper room. My favorite tip? Call the hotel directly and negotiate over the phone. You see, booking sites (e.g. Orbitz and Expedia) often make a 30% commission, so it can actually save hotels money if you book directly with them. So, your best move is to call the front desk — not the toll-free reservations number — after 1:00 p.m. (9:00 a.m. — 1:00 p.m. is considered rush hour). Once you’re on the line with an actual human, go for a price that’s 20% lower than the going rate on the booking site. And if you need some extra guidance on how to negotiate (for anything, not just hotel rooms), DailyWorth has some helpful pointers.
August’s Deal Zone
Wallets rejoice! Airfare prices are predicted to drop (big time) starting this month. Industry researchers at Hopper.com predict the average roundtrip ticket will cost $248 this fall — a 3.6% drop from last year and a 8.1% drop from two years ago. We’re also approaching the August “Deal Zone” (August 20-25), when airlines often slash fares 15-20%. But since summer airfares have been cheaper than last year’s, Hopper thinks 2015’s Deal Zone is looking more promising than ever. In addition to these flash sales (that you can keep an eye on here and here), lower fuel prices, as well as the Department of Justice’s investigation into airline collusion, might also contribute to bigger price drops.
Best Neighbor: Two Buck Chuck
Do you live closer to Trader Joe’s or to Whole Foods? I ask, because your proximity to these stores could affect your home’s value. New research from RealtyTrac shows it pays to live closer to Trader Joe’s, where homeowners have seen an average 40% increase in home value since buying. Homeowners near Whole Foods have only experienced a 34% appreciation — the average for all zip codes nationwide. Homes near Joe’s also have higher values — an average of $592,339, compared with $561,840 for homes near Whole Foods. However, when it comes to property taxes, homeowners by Joe’s foot a bigger bill, paying 59% more at $8,536 versus $5,382 for WF neighbors.
The Real Value of $100
The Tax Foundation just released its updated map on the cost of living in all 50 states, looking at how much — or how little — $100 is worth in each one. If you live in Mississippi, you’ll feel greater than a hundred bucks knowing that your $100 buys you $115.62 worth of good, clean (or not so clean) living. Live in Washington D.C., however, and kiss roughly $15 goodbye: $100 is only worth $84.96. See how your state stacks up here.
Have a great week,
Jean
