COMPARE TELEPHONE COSTS THE RIGHT WAY

By Dr. George Molteni*

Lots of articles, consultants, and books will tell you that it is possible to save money on your telephone bills. But how many of them actually tell you how to do it?

Ignorance is expensive

One of the simplest and most important things for you to do is to determine your current telephone charge, or Cost Per Minute (CPM). This is basically like miles per gallon of gasoline. First, take the total amount of minutes used to equal the dollar amount. Then divide the money by the minutes to get your average CPM.

In our example: Say you were charged $200 for a total of 800 minutes. That equals a CPM of 25 cents.

Now that you know your CPM, you can shop around for the best rate. Don't expect to get discounted rates by dealing directly with the major carriers, though. Once they find out what you're shopping for, they'll quote you rates for their basic plans. So, you might as well shop with vendors that are more locally based. Your service calls and questions will end up costing you less money that way. And don't be fooled by plans that you pay for by the month. We discourage pre-paid plans, since you'll never be able to determine if you're really getting your money's worth. You need to convert everything into a CPM figure in order to get accurate comparisons.

You also need to remember that all calls go over AT&T lines, so don't buy those arguments that one company offers quieter, cleaner calls. All you end up paying for if you buy those pitches is the ad!

Rates do vary

Line quality doesn't vary, but rates do. A recent survey found basic rates varying from 12 cents per minute to 22 cents per minute. A nice calculation to remember is that every .01 cent reduction in your CPM will save you approximately five percent. Now that you know what to do, go do it!

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