'Senior' cellphone plans a good deal?

This post comes from Catey Hill at partner site MarketWatch.

At a time when many older consumers are rebuilding battered nest eggs and wrestling with health care costs, the relatively low sticker price of a "senior" cellphone plan can be alluring. But many of those plans reflect a pretty old-fashioned view of how people use their phones. They charge extra for email and other kinds of data -- and that means many customers could wind up with much bigger bills than they expected.

Cellphone use among older adults is rising steadily -- nearly seven in 10 people over 65 now own a cellphone, up from 57% just two years ago, according to a study released last month by the Pew Research Center. And the percentage of older users who access the Internet or their email on their cellphone has increased from 7% in 2009 to 16% this year.

For that fast-growing group, the typical senior deal can be problematic. Both Verizon (via its Nationwide 65 Plus Plan) and AT&T (via its Senior Plan) offer people over age 65 a plan that costs $29.99 a month and gives users 200 "anytime" minutes (which can be used at any time of the day, free of charge). Both plans also include unlimited mobile-to-mobile calling.

Compared with the average wireless bill -- currently $47.21 a month, according to the International Association for the Wireless Telecommunications Industry -- that can look like a substantial savings. But Matt Mirandi of BillShrink.com, a site that lets consumers compare cellphone plans, points out that many seniors could find themselves on the hook for much bigger bills. Talk-time overage charges add up quickly -- typically, they cost 45 cents a minute.

More important, these plans generally don't include any data, and the extra costs for that can add up fast, Mirandi explains. With Verizon's plan, for example, a basic two-gigabyte plan -- the minimum required for a smartphone for occasional emailing or Web browsing -- costs an extra $30, and five gigs, an additional $50. Someone who likes to stream music and the occasional video is likely to need more than two gigs -- and suddenly, that senior plan costs almost three times as much.

Verizon and AT&T didn't respond to questions about limits on their senior plans. But they and other phone carriers do offer plans that can represent better deals. In general, Mirandi recommends that families consider incorporating their over-65 relatives into a group plan like Verizon's Share Everything plan or AT&T's Family Plan, which can cost as little as $30 a month for each phone. Groups of unrelated friends -- think neighbors in a winter condo community -- can also share such plans.

"Just be sure everyone's on the same page about when the bill is due and what should happen when overages occur," says Andrea Woroch, a money-savings expert for consumer-app maker Kinoli.

Here are three other ways a retirement-age consumer can slash a cellphone bill:

Negotiate a temporary increase in minutes or data. The life of a retiree can be pretty varied. One month you're relaxing at home; the next, you're driving cross-country in your RV. But if there's one month you think you'll be calling or texting more or using more data, you don't have to permanently increase the minutes and data and the cost on your current plan. Consumers can call ahead of time and ask the phone carrier to add a set of extra minutes or data to their plan just for the month for a small fee. "This can mean big savings in the long term," Mirandi says.

Don't overpay for data. A lot of people overestimate how much data they'll use checking email or surfing the Web on their phone, and thus pay too much just "to be safe," says John Marick, the CEO and co-founder of Consumer Cellular, a national cellular-service provider. Sites like BillShrink.com help consumers analyze their data usage. To keep their cellular data usage down, users should make sure that when at home, they surf on their personal Wi-Fi network rather than on the phone company's network.

Consider a prepaid phone. Customers who seldom use their phones should consider using a prepaid model rather than being locked into a contract. "Wal-Mart has some great deals on these," says Michael Bremmer, the CEO of TelecomQuotes.com, a company that helps businesses find cellular service options. For some phones, you can pay a flat $30 a month, taxes and fees included, and you won't get hit with overage charges -- since you can't use more than the minutes you've paid for.

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