We received an inquiry today from someone who just got a bill from his phone company iPrimus for $102. Most of the calls were local calls, with a few to interstate landlines. There were virtually no mobile calls as he has a good capped mobile plan to make calls to other mobile phones. He also pays $49 for an internet connection with AAPT.

So what could Naked DSL do for him? I checked his phone number and he is connected to the Epping exchange in the suburbs of Sydney. Among the providers available in the Epping exchange are TPG, iinet, Netspace, Exetel, Optus and Dodo.

This customer was not too familiar with Naked DSL, so I explained a few things….

The Naked DSL Solution

1. You no longer pay line rental. The particular plan he was on with Primus was $36 line rental per month. Say adios to having to pay that with Naked DSL.

2. Because he was mainly making local calls, I instantly thought that iinet Naked DSL would be a great option. You get a free VoIP service with unlimited local and national calls to landlines within Australia. With the line rental gone, there goes most of that $102 phone bill each month.

3. iinet would also be a really good option because they allow you keep your existing home phone number with your iiTalk VoIP service.

4. Naked DSL is an ADSL2+ broadband connection. So it’s as fast as you can get with an ADSL service. So this customer was happy to know that he would get faster internet than what he had with his current AAPT ADSL1 plan.

5. This customer was not a big user of data. So he was looking at the $49.95 plan for 2GB peak data + 2GB off peak data or the $59.95 plan with 8GB + 8GB.

The $49.95 plan only has the option for no contract with a $195 set up fee, whereas the $59.95 plan has the option for a 24 month contract with a $79 set up fee. The customer liked the idea of a lower set up fee on a 24 month plan. So he chose the $59.95 plan with 8GB peak data + 8GB off peak data. He only has he and his wife and small children at home and they don’t download much, so this plan will provider ample data for him.

6. He was also very happy to know that there are no excess fees if he goes over the data limit. We were also looking at Optus plans and were concerned that if for some reason he exceeded his data allowance with Optus he would have to pay 15 cents per MB in excess fees for up to 2GB extra. That is a total of $300 in excess fees -what a rip off!

7. He had an old modem from AAPT which needed upgraded, so I recommended he get the iinet BoB modem which comes pre-configured or any ADSL2+ VoIP modem if he is able to set it up himself.

8. Lastly I mentioned that there is an internet outage period of 1 to 2 weeks with many Naked DSL connections while they are being set up. He was fine with that and decided to proceed with the application.

Total Saving: $90 per month or $1,080 per year!

Last Month:

$150 for phone rental, phone calls and broadband internet

Next Month:

$59.95 for iinet Naked DSL + unlimited calls to landlines in Australia

Investment:

This customer chose to go for a 24 month plan and so his set up fee was reduced to $79. He also needed to invest in a new ADSL2+, VoIP modem. I recommended modems that were going to cost between $130 and $209. So the total investment for getting Naked DSL was going to be about $200 to $300. This investment will be paid off within 2 to 3 months of switching to Naked DSL. From there our case study will be saving $90 every single month!

Most people like to keep their household expenses as low as is practically possible. If you can save $50 a week, then by the end of the year you will have saved over $2,500 in post-tax dollars. I’d rather have that money in my pocket or spending it on a holiday than paying it in bills!

Is saving that much money actually possible? Definitely. There will be lots of ways you can do it. Take lunch to work instead of buying it, don’t get suckered into buying food and snacks from a petrol station, do a meal plan and eat at home rather than getting fast food, quit smoking, cut down your phone and internet bills, stick to a budget and the list goes on. And on. And on. There are lots of ways you can save money. But I don’t have expertise in most of these matters, but I can help you on reducing you phone and broadband costs.

Here’s my guide on how to save money by significantly cutting your phone and broadband bills.

1. Know What You Are Using and Spending

Do you actually know what you are using each month? And what it is costing you? Surprisingly, many people don’t. They just pay the bill without paying much attention or it is set up on direct debit and they never think of it (until their bank account is empty or the credit card is maxed out). If you know what you are using and how much you are spending, then you have a chance of reducing the cost and maximising the usage.

2. Write It Down

Depending on how technically inclined you are, you may want to use a spreadsheet to do this or get out a pen and a piece of paper. When you write down your usage and costs, break them down into home phone, internet and mobile phones. There is little point in looking at all three together as a total cost. By itemising your usage and costs, you can best see where savings or enhancements can be made. You may already be on a good mobile plan, but need to cut down on home phone and internet expense – only by itemising can you accurately see this. You may be only using 5GB of a 20GB download allowance on your broadband plan and could drop to a lower monthly plan.

The act of writing it down or entering the details into a spreadsheet will also give you greater commitment to doing something about it.

3. Start Comparing and Looking For Something Better

There are all sorts of ways you can compare and work out how to get a better deal. I’d suggest starting online. Compare a couple of the major competitiors to your provider and see how the deals stack up. You could also call your existing provider and ask them if you are on the best deal for your usage – I’d only suggest doing this after you have scoped the market. Otherwise you lose the power of negotiating a sweeter deal if better things are available. If you aren’t confident you’re making the best choice then look at finding a website or a broker who you can trust. They will get paid by a provider for helping you, so in most cases it won’t be money out of your pocket.

I’ll write a follow up article to this with an article on saving money with Naked DSL. It will look at some case studies and if the sums really stack up.