You’ve probably noticed a lot of new cell phone companies popping up recently. Most of these are known as MVNOs, or Mobile Virtual Network Operators. What the heck?

Basically, MVNOs are retailers that buy voice and data coverage from the giant companies we all know. AT&T, Verizon, Sprint, T-Mobile and others own the cell phone towers and something known as spectrum, or airwaves through which our communications flow. Most of this spectrum is reserved for their own customers, but some is made available to the MVNOs, who buy it at wholesale rates. It’s then sold to you at a deep discount.

What’s so great about these new players? Lots of things. They’ve turned the traditional contract-oriented business model on its head, and eliminated most of the drawbacks we associate with major cell phone providers.

Let’s talk about cost. You typically pay about half as much per month as you would with one of the Big 4. Virgin Mobile USA, which runs on Sprint’s network, offers plans starting at $35 a month. This plan includes unlimited data and texts and 300 voice minutes a month.

If you talk more than that, the industry standard for unlimited everything is $45 a month. That’s what Straight Talk, the best-known MVNO, charges for their plan. Depending on which phone you get with Straight Talk, you could be on any of the four major networks.

MVNOs operate on a prepaid business model, where you pay for service up front. They offer non-contract service, which means they darn well better provide good service and treat you well. If they don’t you’re free to kick them to the curb at any time.

Compare that with the Big 4, whose business model depends on slapping you with two-year handcuffs. You think they’re very motivated to provide service once you’re a prisoner?

The downside for MVNOs is that the phones aren’t subsidized. You have to pay real money for a new one – often $200 or $300 – depending on how fancy you want to get. The tab goes up to $500 or more if you want the newest iPhone.

For most consumers, that big upfront cost is downright scary. We’re used to getting a new phone every 18 to 24 months and paying no more than $200. Some can even be free, depending on promotions at the time. But that initial savings is easily eaten up with the higher monthly rates.

Let’s look at an example. At Verizon, you get one smartphone with 2GB of data for $100 a month ($110 after taxes and fees). You choose the Samsung Galaxy S III, which sets you back another $200. Total cost over two years: $2,840

Compare that with Straight Talk. You get unlimited talk, text and data for $45 a month. The closest phone they offer is the Samsung Galaxy S II for $350. Total cost over two years: $1,430

You’ll have to settle for the previous generation phone, but it’s always best to avoid state-of-the-art anyways. Even with the higher upfront cost you’ll pay exactly half with Straight Talk. The same is true with any of the other MVNOs.

My contract with AT&T expires later this year. I’m excited to explore the non-contract options over the coming months and see what’s out there.

It’s never been easier to escape the clutches of a two-year contract. The savings are real. What would you do with $1,400?

[Note: If you're curious, Wikipedia has an excellent list of MVNOs and which major network they're on.]

See also: Low-Cost Options for Cell Phone Service

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How many times have you seen someone lay their credit card on a checkout counter while waiting to sign the receipt?

Maybe you’ve done it yourself recently. I want to alert you to a growing scam taking place in retail stores across America.

Using the camera on a smartphone, criminals are taking pictures of your credit card as it lies there face up on the counter. All it takes is five seconds.

Cameras in smartphones have improved drastically in recent years. It’s now possible to zoom in from six, eight or ten feet away and take a crystal clear picture of something as small as a credit card. And that’s exactly what they’re doing.

In all the commotion of the cash register you probably won’t notice anything suspicious. The cashier, who attempts to save you 10% on your purchase by offering a store card, doesn’t help. That’s why you have to make it a point ahead of time to protect yourself when you’re out shopping.

Some credit card companies are becoming wise to this tactic and are completely leaving the card number off the front of the card, opting instead to print it on the back.

The simplest tip I can give you is to never leave your credit card lying around. Even just for a second. If you’re not physically using it to make a transaction it needs to be in your wallet.

Don’t leave your wallet or purse unattended either. So often people get caught up in the shopping experience or with the kids and leave their wallets sitting somewhere. To make it easy on yourself, only carry the forms of payment you plan to use that day.

Criminals are betting and hoping you’ll let your guard down just for a second. Don’t fall into that trap.

Photo by mybanktracker.com

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Fast forward to 2013. It’s now common to see students in their 30s and 40s going back to school in the middle of their working lives as part of a career change.

Maybe you’ve thought about going back to school yourself, either to advance in your current field or to study a new one. But a lot has changed since you first set foot in a college classroom all those years ago. The most relevant for you: Tuition has skyrocketed during the past two decades, much faster than the overall rate of inflation.

The effect of excessive student loans has been so severe on recent grads that some are even putting off their dreams of having kids or buying a house so they can service their loans.

Going back to school is a worthy goal, but doing so shouldn’t cause you financial hardship. There are a few things you can do as part of your college search that will help you avoid extreme debt.

1. Visit Fastweb.com. This site is a treasure trove of information for everything you ever wanted to know about applying to college. You can learn about early applications, filling out the FAFSA, and how best to prepare for tests or interviews. Best of all, they match you with scholarships from their database that best fit your situation. You have to fill out your profile with information like your major and colleges of interest, which they then use to find the most relevant scholarships.

2. If you plan to keep your job, check to see if you’re eligible for tuition assistance. Many employers offer at least a partial tuition benefit to encourage loyalty. This is especially relevant for those who want to stay on the same career track.

3. Look at any professional organizations you’re a member of. Do they offer scholarships to people going back to school? How about your church?

4. For graduate students, meet with your dean or department head to see if there are any research or teaching assistant jobs available. This is probably the most overlooked source of money for graduate education. It may involve some ongoing work on your part, but you’ll likely gain valuable experience and contacts in your field along with the dough.

Remember, a college education is an investment. Consider all the costs involved and how much more your new degree will likely earn you in the workplace. My hope is that these tips will help you offset part of your expenses along the way.

Have you found money from these or other sources for returning to school?

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In a previous post about inertia and why staying the course can hurt you, I said that those who remain with their insurance provider year after year are probably paying too much. Most people never shop their insurance rates, so they have no idea what kind of deal they’re getting.

But this assumes all insurance companies are equal. According to Consumer Reports and J.D. Power, some insurers are better than others. In surveys they conduct, two insurers stand above the rest in customer service year after year: USAA (for military service members and their families) and Amica Mutual. What if you’re already with one of these two – do you still need to shop quotes?

This blog is normally all about helping you handle money better and save as much as possible. In this case I have to make an exception. With insurance, you can’t base your decision on cost alone.

Instead, the focus needs to be on how you’re treated when you make a claim. Surveys have shown that when the chips are down, these two companies stand head and shoulders above the others in resolving your claim.

Think about it this way. You buy insurance hoping you’ll never need it, but expecting that if you do the company will be there for you. In my opinion it’s worth paying a little more for a company with a proven record of great customer service.

We’ve all heard stories about cars being totaled or trees falling on houses and what a pain it was to deal with the insurance company. Switching to one of these two companies will greatly reduce your chances of going through something like this.

But if price is a big deal to you, shopping around can make a big difference in your premiums. Get quotes from at least three companies so you know what kind of deal you’re getting.

If you want to be with one of the two best but the premiums are too high, try raising the deductible.

Take this from a cheap guy: Cheapest is not always best in the insurance industry. Focus instead on how you’ll be treated during the claims process and you’ll be happier in the end.

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But even if you do talk a lot, cell phones aren’t always the cheapest way to make those calls. Sure, there are times when only a cell phone will work. But if you do a lot of your calling from home, switch to one of these alternatives to save big each month.

I’ll start with the cheapest option and work up to the most expensive (but still cheaper than buying minutes from the cell phone company.)

Google has a service creatively known as “Call phones from Gmail” that lets you call any phone in the US and Canada from within Gmail. They recently announced it will be free for all of 2013. I tried this out the other day after getting fed up with AT&T’s poor cell phone reception in my apartment, and the calls were crystal clear. The caller on the other end said it sounded like I was in the other room talking.

All you have to do to start making calls is install a plugin and log into Gmail. They also offer free video chats, which I didn’t test.

Another option is magicJack Plus. While the original magicJack required a computer to use, this one works with or without a computer. And that’s a game-changer, because who wants to wait for a computer to boot up before making a call? Just plug the device into your modem, and after a brief registration you’re up and running. You can even transfer your current number.

They’re doing a free 30-day trial right now, so check it out. After that it’s $20 a year.

Finally, there’s Ooma. Don’t ask me how they came up with a name like that, but according to Consumer Reports, Ooma is tops in call quality bar none. That includes land lines from AT&T, Verizon and others.

The most expensive of the three, it’s also pretty darn convenient. You don’t need a computer up and running to use Ooma. Yes, it works through the internet, but it plugs straight into your modem. Just like MagicJack, you plug your home phone into the Ooma device and start talking.

Ooma costs anywhere from $130-$150 for the device, although I saw it on sale at Costco for $100 recently. The only other costs after that are about $45 a year in government taxes and fees. You may be able to save that in one month by reducing your cell phone minutes.

My take: If you don’t mind using a headset and sitting at your computer, the first option is best. But if you like using an actual phone and enjoy the flexibility to move around the house, the other two are better options.

All three of these services offer unlimited calls over the internet for basically zero dollars. If you’re on the fence about reducing your cell phone minutes, take the leap and give one of these a try. Talking over the internet is a heck of a lot more cost efficient that busting your budget with the cell phone company.

The call quality is much better, too.

Related posts:

Low-Cost Options for Cell Phone Service

Ways to Save on your Cell Phone Bill

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I would if I could. The truth is, I can’t claim that any one card is absolutely best for everyone.

I love rewards credit cards. Getting paid hundreds of dollars a year to use a credit card to buy things I would buy anyway is, well, rewarding.

I use three different cards as part of my strategy. One of those is the Discover More card, which has traditionally been a solid choice for an all-around great rewards card. I recently learned that Discover is shifting its strategy and will now market only one card, known as Discover it. Don’t ask me why “it” is lowercase.

This new card is much more customer-friendly than their previous cards. In the past, there was an initial tier that only gave you 0.25% cash back on the first $3,000 in purchases, and 1% after that. You now get 1% from the start. There’s also no fee for going over your limit or your first late payment. Other benefits include US-based customer service and the ability to choose your due date.

Discover cardholders have the option of converting to the new card or remaining with their old one (I chose to convert).

With these improved terms from Discover, how can you compare their card with the multitude of others out there?

Take a look at your spending patterns. Do you travel a lot? Are you a college student? Maybe the bulk of your spending is groceries and gas. For each of these situations, there are several cards that could potentially work for you.

Before I discuss how to find the best rewards cards, I should mention that if you carry a balance — no matter how large or small — rewards cards aren’t for you. They typically charge higher-than-average interest rates, so any rewards you might get are negated by fees and interest charges. In this case go with a low-interest card, perhaps from a credit union.

My favorite site for comparing rewards cards is CreditCardTuneUp.com. This site lets you input your average monthly spending in 15 categories such as restaurants, department stores and hotels. To get your monthly spending figures, I recommend looking at your credit card statements from the last 12 months.

Based on the information you provide, you get a list of the cards that best match your spending pattern. It’ll tell you what your first year rewards total would be, minus any annual fee.

Another great resource is NerdWallet.com. The idea is the same, but this site also lets you input your credit score and preferred network (Visa, MasterCard, etc.) You have a choice of either a customized list of your best matches or their list of the best credit cards of 2013. On this list they divide cards by category (rewards, no interest, college, etc.) and tell you why they love the card.

More credit card companies are offering a cash or gift card bonus to entice new members. I’ve seen offers worth as much as $625, but more typical offers range from $100-$200. These sign-up bonuses are definitely worth a look as you search for your best card.

There are other things to consider as well. If you frequently travel outside the country, look for cards with no foreign transaction fee such as Capital One and the Discover it. If you fly a lot, be aware of blackout dates and mileage redemption rates. If the card has an annual fee, make sure you’ll spend at least enough to offset the fee.

The key to finding the best rewards card is to look at your spending patterns. Then, use one or both of these websites to compare offers and find the best card for your lifestyle.

Photo by blog.chargesmart.com

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Our baby, Elaina

Our first child was born this past November. As other first-time parents know, babies come with a multitude of expenses.

I’m not sure how many Walmart runs I made that first week, but by the end I knew I didn’t want to see that place again for a while.

During that first week I also found myself in another big box store in search of a specific baby item. This store happened to have a generous price-matching policy through Christmas, which I saw advertised all over the store.

I found the item and noticed the price was a little high compared with prices I’d seen online. I weighed whether it was really worth paying an extra $29 to have it immediately.

In this case, because the comfort of my wife and baby was at stake, there was no question in the end that I was walking out of the store with that item in hand.

As I was standing in the aisle though, I got an idea: Let’s see what other stores around me are charging! I whipped out my phone, opened the ShopSavvy app and scanned the bar code. (Long-time YLL readers will recognize this concept as showrooming.)

There on my screen appeared the lower internet price I’d found earlier.

Then I remembered the price-matching signs I’d seen just minutes before. Would they match the online price? I had nothing to lose.

At checkout, the cashier wanted a few more details about the lower price I’d found. After answering his questions and showing him the results on my phone he let me know that yes, he would give me the lower price!

Then my mother-in-law handed me a coupon she found in their ad at the entrance for $10 off. I ended up getting the item for $10 less than the lowest online price I found!

So what are the lessons here? First, download and use a price comparison app on your phone. ShopSavvy and RedLaser are both excellent choices. Now that comparing prices is so effortless, you have no excuse for not doing the research.

Second, always ask about the store’s price-matching policy. Even when you don’t see one advertised. Bricks and mortar retailers are wary of losing business to online sellers. They’ll often give you a break, but only if you ask.

Now why didn’t I tell you which store I was in or what the item was? Because that’s not important. What is important is that you use the tools available to you to get the best price. Use these two tips to do just that.

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And that doesn’t include the time you’ll save by not parking yourself in front of the TV so much.

“This is great!”, you may be thinking. “Who knew I could save so much money from my paid TV service alone!”

Just because you may be thrilled to save all this money, you can’t assume the cable or satellite company will be equally excited to see you go.

When cutting the cord, most people call the company and cancel over the phone. They assume that after hanging up they don’t have to take any more steps.

That could end up being a costly assumption.

Some providers are so sad to see you leave that when you call to cancel they suspend your service for a few months rather than cancel it outright. How nice of them to assume that we’ll miss them so much six months from now that they’ll just start the service back up without our knowledge or permission!

You may even receive a confirmation email of your phone conversation, but you won’t notice this little gotcha until you read the fine print on page 34.

This is exactly what the desperate cable and satellite TV operators are doing. They’re bleeding subscribers and can’t afford to lose you too.

After canceling service, you typically have 14 days to return their equipment. Some providers send you a postage-paid box to send it back in, while others require you to bring it to their local office. Those who don’t take this extra step may notice a charge of several hundred dollars for a cable box and remote on their final statement.

Even when you do send the equipment back on time, the records at the cable or satellite company may become inaccurate over time. If they incorrectly show you as never having returned their stuff, they’ll send your account to collections and you may find yourself getting calls from a collection agency years down the road.

So how do you protect yourself against rogue providers in the cable and satellite industry?

There are two things you must do each time you cancel cable or satellite service. First, get an email confirmation of your permanent cancellation after you talk with customer service over the phone. Look through the email to make sure they didn’t simply suspend your account for six months. You may have to call back a time or two until you get someone who is competent enough to complete your transaction.

Second, before you release the package containing their equipment to FedEx or UPS, get a receipt showing when you sent it. Hold on to the receipt. Then if a collector calls years later saying you owe them for the equipment you’ll have documentation to prove otherwise.

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Whether it’s restaurants denying entry to veterans who require the assistance of a service dog or CVS signing people up for prescription refills without their consent and billing them for it, many companies seem to have lost their focus on the customer.

There’s even a popular website devoted to exposing customer service horror stories.

In the old days, if you had a problem with a company you did one of two things. You either sent them a letter or you set aside a large block of time on Saturday morning to navigate the company’s phone tree in hopes of reaching someone who cared. Your chances of success with these methods were pretty slim.

Thanks to social media, there’s a new way to be heard. Companies are waking up to the fact that if gone untreated, customer complaints on Facebook and Twitter can spread like wildfire.

Many of the biggest ones are spending heavily on their social media presence. I read in the WSJ that two years ago, GM had no strategy for monitoring complaints on social media. Today they have 30 people doing just that.

The power of social media is that anybody can be heard. Sure, some people use this power frivolously, like to complain that their parking spot was stolen or to let us know what they had for dinner. But Facebook, Twitter and other sites also provide an outlet that lets us voice our complaints and frustrations about products and services.

It doesn’t matter whether you have one follower or a thousand – social media levels the playing field. In true David vs. Goliath form, you’re able to bring even the biggest companies to their knees.

If you have a beef with a company and they don’t seem to listen, you now have another way to be heard. Look to social media.

It doesn’t matter how large or small the company. Sure, larger companies are more likely to monitor social media for complaints, but no company wants to tarnish its image by allowing complaints about them to linger. Use their fear to your advantage.

Have you engaged a company through social media to solve a problem?

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We know the library can save us money. But could it make us rich?

I came across a post by Mr. Money Mustache I thought was both entertaining and informative in its description of how libraries can make us rich. In his tongue-in-cheek style, MMM starts off:

A few years ago, I learned the most shocking fact about public libraries:

Not everybody uses them!

“No!”, you may say, “That’s impossible – how else do people get their books?”

The scary answer that I discovered is that some people have developed a habit of regularly buying books which cost them $10 – $30 each, reading them, and then collecting them on an ever-growing series of bookshelves.

The post talks about the excuses people give for collecting books, and the author admits to feeling great when walking past a large collection of books. His collection is large too. But the difference, in his words:

…I have several hundred thousand of them, and a paid staff who roams through my modern curved-glass 20,000 square foot book storage facility, automatically maintaining them and buying more for me constantly. I have so many books that I share them with everyone in my entire city, and we’ve even come to an agreement where we ALL pay just a few dollars per year each for the facility, and yet any one of us can borrow any of the books.

If you haven’t figured it out, they call the facility the “Public Library”. It wasn’t until recently that I started thinking of the library in this way. Instead of each of us maintaining an individual collection of books, why not pool our money to create and maintain something far larger than any of us could achieve alone?

The post ends with a description of all the awesome things his family does in the library. Each family member can indulge his or her interests without taking on extra debt or expense. His family has 30 books checked out at any given time, which is ambitious. But that’s the thing – it doesn’t matter if you don’t finish everything. You didn’t pay for the book, so nothing is lost.

Now that we’re aware of what the library has to offer, think about your current buying habits. How many times a month do you walk into a bookstore just to take a peek, only to walk out with a new title or two? Do you enjoy adding to your DVD collection that never seems to be complete? These things cost real money. Money you’re earning from that dead-end desk job or retail job you hate, day after day, week after week with no end in sight. Have you considered that maybe the reason you’re chained to that job is you’re not visiting the library often enough?

Let’s say each month you buy 4 books at $20 a pop, 2 DVDs at $15 each, and 4 magazines at $4 each. In one year you’ve spent $1,512 and have that much less space in your home. After a decade, that’s over $26,920 compounded at 8%.

Even after 10 years, your collection will be no match for the library. So why compete?

Mr. Money Mustache sums up well the library’s role in our lives:

It romances all of us and sucks us in by catering to every one of our interests.

Be romanced by the library and watch your riches grow.

Photo by www.gomdl.com

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