How to save money on phone bills in USA

With the following setup you can save up to 80% of your yearly cellphone bill (the average American has a $40 per month contract). If you are a bit careful with your phone calls, you would only need to pay $110 per year (which is equal to 33 hours of phone-talk per year). It is not as convenient, but if you are in need of better management of your financials, it is a good alternative. It is a mix of prepaid cellphone account (”pay as you go”) and VoIP usage. Here’s how to do it:

1. Create a GizmoProject VoIP account and install its software on your computer(s) or PDA. Either get a $5 headphones[+microphone] headset, or if your Windows Bluetooth stack supports it, get a Bluetooth headset for about $25. Gizmo will give you an IP-only phone number, looking like 1-747-xxx-xxxx.
2. Buy a $10 call-out with a credit card from your Gizmo page. This will give you 1000 minutes per year (you can buy another 1000 minutes for just an extra $10) and really low cost international calls. And if some of your friends and family are connected on the Gizmo network too, both parties won’t have to pay at all to talk with each other.
3. Get an IPKall call-in number for free, as explained yesterday from my blog post. Attach your Gizmo number to this new call-in number and give this new number to your friends and family. IPKall’s number can be called by any kind of phone. IPKall does not work with Skype (because Skype is proprietary with a closed protocol), you will need a SIP-based provider to attach that number to (like Gizmo is).
4. Get a prepaid cellphone GSM account with either Cingular or T-Mobile. T-Mobile gets you “1000 whenever minutes” with their $100 credit purchase (expires within 1 year), but they have really high international rates ($1.50 per minute) and they don’t offer GPRS, while it’s not clear if you can use their prepaid SIM with any GSM phone. Cingular doesn’t have these limitations, but it doesn’t have free minutes. Instead, they offer two prepaid plans, one that it’s free cingular-to-cingular but you have to pay $1 per day for each day you use the phone and a second plan that it doesn’t have the $1 tax, but it is not free from cingular-to-cingular. Whatever of the three plans you decide to go with, just make sure you research them first and the chosen plan does what you want it to do. If you go with Cingular, make sure you use a quad-band cellphone so you get the best possible coverage.
5. Use your Gizmo call-out plan when you have your laptop/pda connected to the Internet & Gizmo, and use your prepaid cellphone when you are outside of a wifi’s vicinity. Ask your friends to call you on your prepaid cellphone number only if you don’t pick up on your IPKall and/or Gizmo number.

The whole thing is of course not as convenient as a full cellphone usage (you effectively have 3 phone numbers that you use depending on the situation), but it will save 80% of your cellphone bill which can be very useful to poor college students. If this idea works well for you (especially if you spend most of your time at work, home or university where there is always a WiFi network), you can even ditch any landlines that you may still have connected.

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