The following is a guest post from long-time reader and commenter, Michelle. Please feel free to send any guest posts my way even if you aren’t a blogger yet. Thanks Michelle!
Quite often, the frugal thing to do is to shop around to get the best deal, and to do that every year or so, but there are still some times where not shopping around can reap you major benefits in the long run. Here is one example:
My History with Verizon
I have been with Verizon for my cell phone service since before Verizon Wireless even existed… I was an AirTouch customer before they merged with Bell Atlantic in 1999. I currently have a 4G LTE smartphone and pay about $68/month after a 20% employee discount and, of course, the usual taxes and fees.
My current plan: – Basic nationwide voice plan (450 anytime minutes plus unlimited nights/weekends and unlimited Verizon mobile-to-mobile calling): $39.99 – 20% = $31.99 – Unlimited text/picture/video messaging to other Verizon customers plus 50 text/picture/video messages to other mobile customers (added in 2005, no longer available): $5.00 – Unlimited 3G/4G data for smartphones (added in 2008, no longer available): $29.99 – 20% = $23.99
Price if I Shopped Around
If I were a new Verizon customer and wanted to try to build a similar plan to what I have now, I would be paying a lot more. With Verizon’s current plans, the basic nationwide voice plan is still $39.99/month, but unlimited text/picture/video messaging is now $20/month, and the closest I could come to unlimited data is 10 GB for $80/month. On average, I use about 15 GB of data per month, so I would have to begin monitoring my usage to avoid paying overage fees of $10 per 1 GB. I would be paying almost $130/month (assuming I kept myself under 10 GB), including my discount, taxes, and fees. With the introduction of Verizon’s new “Share Everything” plans this month, I could get unlimited voice minutes, unlimited text/picture/video messaging, and 10 GB of data, but I would still be paying about $135/month, including my discount, taxes and fees.
What I am trying to say is that if I would have company-hopped or plan-hopped every time someone offered me a new, “better” plan, I would be paying well over $100/month for my phone service, and I wouldn’t have unlimited data. By sticking with my old plans, I am saving about $60/month!
Keeping My Plan
Every time I go into the Verizon store to get a new phone (and, of course, renew my contract for another two years), they always look at my account and say, “Oh my, your bill is so cheap!” In the past, they have always tried to sell me on the messaging plans. The sales rep would always say something like, “Well, I see here that you went over your allowance of 50 messages by 10 last month, which is an extra $1. Would you like to switch to unlimited messaging for $20/month instead of the $5/month you are currently paying?” Those are the times you want to call their math teachers and/or take their diplomas away.
The deal with Verizon has always been that near (or after) the end of your current contract, you could upgrade your phone at the promotional/subsidized price if you renewed your contract for another two years, and you could keep all aspects of your current plans and pricing, even if they were no longer being offered to new customers. This is how I have managed to pay around $70/month for the past five years. It looks like these days are over, unfortunately. The new “Share Everything” plans are voluntary changes for current customers – I can opt to keep my current voice+messaging+data plan structure – even if I want to upgrade my phone at a reduced price (and renew my contract) when the time comes.
The problem, though, is that if I go this route, I will lose my unlimited data plan, because Verizon is no longer grandfathering the unlimited data plans onto contract renewals. My plan is to not renew my contract when it expires next year, and when I need a new phone, I will just buy one at retail price (or find one on Amazon, etc.). I am not willing to have my monthly bill double and lose my unlimited data just to save a couple hundred dollars on a new phone. If I continue to save $60/month by keeping my old plans, then I am saving almost $1500 over the course of a two-year contract… that’s more than enough to recover the cost difference between a discounted/subsidized phone and one at retail price!
In my case, not shopping around and not chasing the “new, better” plans has saved me thousands of dollars over the years, and I hope that it will continue to do so.
Crystal’s Comments: I think that switching definitely would be a bad deal for you. But I am glad you are keeping your eye out for what else is available so you still know that you have the best deal for you. 
I shop around sort of…every year or so, I go through my bills and see if there are cheaper rates elsewhere, but so far my main bills are cheapest if I stay put. So I have been a long-term customer of Sprint, Gexa Energy, and Geico…
Have you ever saved money by NOT shopping around?
I think in this case it did work out well for you, but what if you shopped around a few years ago and got a similar plan cheaper with AT&T (saving money) and they kept you grandfathered in even with unlimited data. Just because you shop around doesn’t mean you have to switch but I always think it is best to at least know your options.
Although I do not have a smartphone, I am with Verizon forever! First the service is great. I have a family plan (750 min.)and receive an 18% discount. I only pay $70 per month.
I had a similar experience with my cell phone plan (Bell, in Canada). When I last upgraded my phone, I was paying a price I was happy with and getting decent features, although not everything I wanted. Speaking to their “customer retention” office I got everything I wanted at the same price I was already paying …. and half the price I’d be paying with any other company.
I have my cellphone plan for almost 5 years now. I also have my internet service for the same span and I do not think I have to switch plan or company because I am (so far) satisfied with the service I am getting from them. However, since I am not looking for other options, I am not really sure whether or not I am saving from my current plans, but as long as I am satisfied with what I am getting, I will stick with what I currently have, regardless of the cost.
I agree, sometimes when you’ve been a loyal customer for the long it pays just to stick with the brand.
I’ve had T-Mobile for over 10 years and my pricing is pretty good. The CS has always been good and they’ve waived fees (number change, upgrade fee) since I’ve been with them so long. And I’m very happy that ATT couldn’t buy them!
I can’t believe what a racket it is in the US. I live in Europe and it’s so cheap (internet access). It’s the same internet – anywhere in the world but because there’s so little competition in the US, people end up paying ridiculous prices for their internet service. Competition leads to lower prices. People will have to stand up to the monopolies in the US (see:Verizon) and that’s your only insurance that things may change in the future.
I have had a similar experience with AT&T. We have a couple of features which are grandfathered in (unlimited data usage, for example), so as long as we don’t change anything in our plan, we’re getting a fantastic deal. It is worth noting that many companies really do reward loyalty. Our car insurance, for example. We could have switched to a different company over the years, but we didn’t, and now our rates stay nice and low.
You’re right. Sometimes this does pay. However, it’s never a bad idea to look around at your other options, especially when it comes to a fast-changing market like the world of cell phones. There are unlimited data plans available today on nationwide top-tier networks starting at $30…. Straight Talk has unlimited everything on AT&T or Verizon for $45 a month… time to shop around for most people.
If you are interested, check out our money tools for some ways to compare prices on these no-contract plans.