Cutting the cable cord is a popular money saving tip offered by experts nowadays.
However, I don't agree with this ‘money saving' move. In fact, I'm willing to bet if my wife and I canceled cable, we'd end up spending more. Here's why.
My wife and I only pay $55 per month for cable with a national company as part of a cable and internet bundle. This includes an HD DVR with access to a ton of free on-demand shows and movies. We even have free HBO for two years. Honestly, $55 for all this entertainment is a steal.
Save on Your Bills and Manage Unwanted Subscriptions — Sign Up Here >>
Before you complain that you could never get cable for that cheap, try to get a better rate yourself. If your cable bill is outrageous, first… negotiate. You can normally ask for a lower price.
If not, threaten to cancel and see if their retention department offers you some perks to keep your loyalty.
If they don't, switch to another provider that offers a more competitive rate.
Cable As A Money Saver
So how on earth could cable save us money? In my opinion, cable is one of the cheapest entertainment options on an hourly basis. If we watched just five hours of cable per week, cable would cost us $2.75 an hour. Five hours a week is a very conservative estimate. Adults aged 18 and older spent anywhere from 18 to 50 hours a week watching TV, according to Nielsen.
If we didn't have cable, my wife and I would look elsewhere for entertainment. Here are some likely replacements and how they'd hit our wallet.
Bowling for us consists of three games per person ($24), shoe rental for each person ($7) and some food from the snack bar ($10). Many people buy a drink or two from the bar ($16). In just one trip to the bowling alley, we'd spend $57 for a total of two or three hours of entertainment. If we take just one less bowling trip per month and watched cable instead, we'd save money.
This App Makes Managing Your Weekly Purchases Easy — Start Budgeting Today >>
Going to the Movies
Right now, we only go to the theater for must-see movies, but without cable we'd probably drop by more often to stay entertained. When we went to see Star Wars the movie costs us $42 after adding in a shared popcorn and drink. This is just a few hours of one movie versus one month of cable for close to the same price.
Aimless shopping is by far the most dangerous alternative to cable. If we make just one impulse purchase, such as a $99 purse or a $79 pair of shoes, we'll easily spend more than the monthly cable bill.
As you can see, our go to alternatives to cable aren't anywhere nearly as cheap as cable itself.
The Streaming Alternative to Cable
Cable isn't the only option. If you find shows and movies you like on streaming services like Netflix (as low as $7.99/mo), Hulu (as low as $7.99/mo) and Amazon Prime ($99/year), you can replace cable with a cheaper option.
Sadly, after trying out these services, my wife and I couldn't find enough shows and movies we wanted to watch on a regular basis. Additionally, my wife and I stick with cable because we like keeping up with the newest shows which are rarely offered on streaming services. However, if these options are plenty to keep you entertained, by all means, go for it.
Cutting cable TV isn't a bad thing if you won't spend more money elsewhere. However, you really should consider how cutting the cord will impact your budget. If you head out on the town to cure boredom when cable would sufficiently entertain you, you may end up spending much more than you expect.
Start Managing Your Finances — Download This Personal Finance App >>