With the rising price of food, gas and electricity, we have no choice but to spend more. But we have more control over how much we allocate to one of our most important items: personal technology.
Compared to the cost of gasoline, which jumped 48% from March 2021 to March this year, the prices of technology products like smartphones, computers and applications are only increasing – 1.3% during of the same period, according to US Bureau of Labor Statistics.
Still, any increase matters because tech products like TVs and phones, which range from a few hundred to thousands of dollars, are so expensive to start with. Plus, some luxury appliances depreciate as quickly as cars, said personal finance expert Jully-Alma Taveras.
“Technology is changing so quickly,” said Ms. Taveras, a YouTuber known as Invest Latina which offers workshops on investing and saving. “If we spend that much on a computer, in three years there will be another chip, another upgrade, another thing.”
Beyond hardware, we tend to lose sight of spending on other types of technology, like online streaming services, cloud subscriptions, and cellular bills.
Here are some tips on how to plug some of the biggest drains on our budgets.
Take control of online subscriptions
A few dollars a month to watch your favorite shows on Disney+ and a few extra dollars a month to manage your data with online services like Dropbox might sound like a bargain. But those costs add up quickly.
On average, people spent $640 in 2019 on digital subscriptions, including streaming services, cloud storage, dating apps and productivity tools, according to analysis by Mint, the online budgeting tool belonging to Intuit. It’s the equivalent of buying a fancy smartphone every year.
Here are ways to reduce these expenses:
Create reminders to cancel. Many of us subscribe to streaming services like Apple TV+ and Hulu to watch specific shows, but we forget to cancel once the programs are over. We would save precious dollars if we looked up the show’s airing schedule and created a schedule reminder to cancel the service the month the show aired its finale.
Set goals throughout the year. Yes to create a reminder sounds too tedious, there’s a broader approach: Set savings goals periodically, like every six months. Removing a few subscriptions would save hundreds of dollars over the rest of the year, Ms. Taveras said.
For cloud storage services, try to pick just one. For most people, there’s no practical reason to back up data to multiple cloud services, like Dropbox, Box, iCloud, and Google One. Try to choose the one that best suits your devices and the type of software you use. A good rule of thumb is to select a cloud service that works well with many types of phones and computers, like Google One, in case you switch to another hardware product in the future.
Reduce your wireless bills
Cell phone bills can easily overshadow the cost of the cell phone itself if we are not careful about the plans we choose. Last year, Americans who subscribed to a Verizon Wireless plan spent $1,342 and those who subscribed to T-Mobile paid $891, according to a New York Times analysis by Mint.
But the plans offered by the major carriers aren’t the cheapest options. There are other brands that offer budget phone plans. WalletHub, a personal finance website with a phone plan calculator, found that Visible, which operates on Verizon’s network, offers the best deal for individuals with a plan that includes unlimited minutes and data for $40 per month. On the other hand, Verizon’s basic 5G plan costs $70 per month.
What’s the catch? You won’t get customer support from an established carrier. Also, off-brand carriers usually only support a limited list of cell phones. The good news is that more of them now generally include the most popular devices from Apple and Samsung, so the trade-off is minor.
“You will essentially receive the same coverage for a much lower price,” said Jill Gonzalez, analyst for WalletHub.
Pay attention to hardware upgrades
The costs of smartphones are constantly increasing, even if their improvements are more and more gradual. (This year’s entry-level iPhone SE, for example, costs $429, $30 more than the 2020 model.) So it pays to think about when is the best time to invest in new gear and how much you’re spending. , rather than upgrading automatically.
The lifespan of our tech devices can be extended many years with a little maintenance – just be sure to replace the battery every two years and purge unnecessary apps and photos that are clogging your device’s storage.
When it comes time to upgrade, what’s the newest and fanciest isn’t always the best for your budget. Ms Taveras said it was common for her students, some of whom are in debt, to spend $5,000 on a new computer. That might make sense to some, but many could live without the excessive frills and big net savings, she said.
It’s worth bearing in mind that when something new comes along, it’s also an opportunity to buy last year’s model – which is usually very capable – for less.
“I’m fine to get the penultimate phone because the technology is still great,” Ms. Taveras said. “These small financial gains are really important.”