Are you having a hard time justifying in your budget the amount of money you spend to watch television? The cost of cable has been rising at an astonishing rate. Maybe you’ve been getting an “explanation letter” from the cable company the last few years stating that your bill is going to go up another $3-10 per month. If it seems like you are paying more, it’s not just your imagination. The rate of inflation for cable/internet access has risen much faster than the national overall rate of inflation.
What makes reducing this one line item in the family budget so frustrating are the limited options available to consumers. You can’t reduce the amount you pay for cable by purchasing just the channels you actually watch. Your options are pretty much a form of basic, premium, or a “super” premium that includes HDTV and pay-per-view. That’s like going to a restaurant that serves only three items: peanut butter and jelly sandwich, prime rib, or lobster. Other utility bills such as electric, water, and gas are based on usage. We can’t eliminate them totally, but we can control how much of them we use.
To what degree is the telecommunication/entertainment line item affecting your household budget? Let’s take a look. Using $130 per month as an average example of a “bundled” plan for internet, phone, and cable; total cost per year to the cable company runs a little over $1500. That may not seem like a lot on the surface, but look at that same amount from the perspective of a longer time period. Over a ten year time frame, $15,000 of your hard-earned money will be spent to watch TV and/or use the internet. WOW. That is a large sum of money that could be used to buy a car, as a down payment on a house, or to pay down the mortgage.
If you want to reduce the amount of money you spend to watch television, Kiplinger’s recommends the following options:
• Trim back the number of channels you’ve been subscribing to,
• Keep up with promotions (you may be able to access the same deals new customers are offered),
• Evaluate feature usage (are you paying for bells and whistles you don’t use?),
• Buy an antenna (you will get free access to local channels, even in HDTV),
• Threaten to leave, and/or
• Switch to satellite.
A majority of Americans watch TV through local cable providers. If you are satisfied with the cost of the entertainment line item in your budget, then carry on. However, if cuts need to be made, then 2014 might be the year you give serious consideration to less expensive options.
Written by:
Donna Green, Family & Consumer Sciences Educator, Ohio State University Extension, Erie County
Reviewed by:
Betsy De Matteo, Family & Consumer Sciences Educator, Ohio State University Extension, NEFE Rep, Ohio Saves Coordinator
Sources:
http://www.annenberg.northwestern.edu/pubs/cable/cable04.htm
http://www.muninetworks.org/content/looming-cable-monopoly
Click to access Cable_mergers.pdf
http://www.kiplinger.com/article/spending/T063-C011-S001-7-ways-to-cut-the-cost-of-cable-tv.html
