Recession Buster 4 - Telecommunication Savings

Reporter: Helen Wellings

Could Alexander Graham Bell ever have imagined how his invention of the home telephone would change the world of telecommunications? There are now more mobile phones than people in Australia. 300,000 of us are now disconnecting our home landlines each year and we're heading en masse to wireless.

But according the Telecommunications Ombudsman, theres a record number of complaints about mobiles and broadband. We're becoming more and more baffled by the rapid changes in phone and internet technology, along with poor service offered by providers and the rising costs.

Helen Wellings shows you how to stay in front and save hundreds of dollars a year on your telecommunications costs.

George Luchesic and his family are like most of us, love their phones - 2 blackberries, one mobile, an iphone, the internet and a brand new addition that's the big saver - slashing their call costs by more than half.

"Here is our old Telstra bill for about $90 and this is our current Voip bill for about $40."

You can say goodbye to home telephone bills. VOIP stands for voice over internet protocol. It enables you to make and receive phone calls using your old telephone handset - but without having your phone connected. It's done via the internet, with this a little connector.

"This is the little Voip box that you need. It costs between $60 - $100" shows George.

Money you'll soon recoup with the $360 a year you save on line rental. With Voip, George pays just 10 cents for calls anywhere in Australia unlimited, untimed. Calls to mobiles 24 cents per minute, no flag-fees. International calls ... 2 cents a minute.

For now though, it's our mobiles that can slug us the most but there are ways to curb the costs.

"85% of the people are paying 30% too much on their mobile phone bills" says Doug Purdie of One2one Marketing. He runs Phonechoice, a free comparison website to help you find the best deal for your home phone, mobile or broadband. Especially with mobile phones, we just pay up each month, not realising the yearly cost.

"The average person is spending $20 a month too much on their mobile phone bill. That $240 a year they could be saving" says Doug.

So how can you save $240 or lots more? First, don't fall for the hype.

"There are a lot of misleading terms out there such as "Free", "unlimited" and the truth is that there is nothing free or unlimited, there is always an exclusion. There is a little asterisk, that means there is something written somewhere else that you really need to be careful of" says Teresa.

Teresa Corbin of Consumers Telecommunications Network urges selecting a plan with a clearly defined cap or opt for prepaid, but prepaid's not for you if you're a high user.

"You're actually paying a higher charge per call if you're a high volume user, you need to be on a plan, you need to be on a plan that actually gives you some benefits from the fact that you use it a lot. And the other thing to do is make sure you are actually using a network that is the same network as your family and friends, people that you call alot, maybe work colleagues, and that way you can actually make some savings" says Teresa.

"It pays to shop around with pre-paid or with any other plan. Some of the pre-paid providers, some of the smaller guys offer you twelve month unlimited expiry on your credits so you don't lose them at the end of the month" adds Doug.

You won't make much headway with savings until you sit down and assess how you and your family use your phones. Have a look at your bills - how many calls you make, how long are they, where are you ringing - local, interstate and overseas. Then you can determine the best and cheapest plan for you, but beware locking into long contracts.

"Many of the plans now are 24 month plans. That's a long time. I don't know what I am doing in 24 months time and most people don't. You might be out of a job in 12 months… You have to be careful with the plans. Because it says, for example, $49 a month gives you $300 worth of calls. What they do is they can change the call rates so that you use up that $300 worth of calls very, very quickly and before you know it you are over your cap and you get a big bill" explains Doug.

More sure ways to save. Message bank fees can easily be 50% of your bill.

"Voicemail is a waste of money for most people. You can either increase the time it takes before the diversion takes place or increase the rings... or turn voicemail off completely" says Doug.

"Another thing to be careful of is 13 and 18 numbers on you mobile. People forget they are not actually free on the mobile they are still a timed call" says Teresa.

So use a landline to call 13 and freecall 1800 numbers to save.

"Another tip with a mobile, if you're near a landline use it. Because calling rates on a landline are often cheaper" says Doug.

Texting - you're charged the same amount no matter how short your text is. And long messages are expensive as they're broken up and charged as multiple texts. Beware one of the biggest money spinners - unsolicited premium SMSs that you sign up for without realising, then find hard to cancel. And don't get stung with new technology.

The main trap - exceeding your limit downloading songs or movies to your mobile - it's already cost people tens of thousands of dollars.

Saving internet costs. For a start beware of lengthy contracts with huge exit fees - you want to be able to take advantage of broadband deals that are getting cheaper and better.

"With broadband you need to have a look and make sure you go for a plan that includes "throttling" which means over your megabite usage or gigabite usage in the month they slow the speed down rather than charging you extra" says Doug.

Bundling all your telecommunications with the one company plan might seem convenient but may not be value for money.

The best way of saving money - get all the family to study their bills.

If you want to compare telecommunications costs between different companies and plans visit