The other day, I announced on Twitter that I was cutting the data plan on my phone and that it would save me $40/month.
I followed my Tweet up with a post about exactly why I decided to cut my data plan, and lo and behold, it has nothing to do with money. I do love money, though, and there is no better financial feeling than having more of it in your pocket, so I thought it would be fun to examine the financial benefit that I’ll experience from this choice.
My cell phone plan has reverted back to the basic text and talk plan, so that will save me a cool $40/month. For those of you who don’t have a calculator handy, that’s $480 per year.
$480 per year is no small number. Instead of inflating our lifestyle by $480/year, we plan on using that money for something more worthy than dinners out or useless trinkets. Here are a few things that we could do with that chunk of change:
Pay For a Month’s Accommodation in Bali
We could extend our honeymoon by a month, or go again sometime and pay for an entire month’s stay in Bali using AirBNB, based on the accommodation cost of our honeymoon.
Since I would save $480 for every single year that I go without data, I could do this once a year. Not bad!
Fly to Cancun
$480 would buy me a round trip flight to Cancun, according to Kayak’s Explore tool. It would score both J and I flights to Los Angeles, with the deal I got in June. With all of the travelling I’ll be doing in the next year, I won’t even need a data plan.
Turn it Into $3,379
Invested for 40 years at a modest rate of return of 5%, that $480 could end up being worth more than seven times it’s original value. That’s the beauty of compound interest.
If I invested it in an RRSP every year I went without a data plan, this number would be far larger. In fact, I’d be able to retire a year earlier if I went without a data plan for a number of years.
Save us $5,948
If we chose to put the $40/month toward the mortgage principle for each month left, could save us $5,948 in interest over the life of our mortgage, and shave about another year off of the payback time.
That almost $6,000 could buy us a pretty awesome trip to Europe or Asia, or a new (to us) vehicle.
Buy a Kayak
If we saved the $40 per month, in two years time we could buy a kayak. We’ve wanted a kayak for some time now, since we live close to the ocean and some lakes. How much fun would it be to have a kayak?
We could buy a used kayak in about a year of the savings if we found one on Craigslist.
Score a Canon Eos Rebel TSi
I’ve been lusting after this camera for awhile now. My iPhone camera does the trick for the most part but who doesn’t want a new toy to play with every once in awhile? Especially considering the amount of travel I’ll be doing in the next couple of years.
If I bought this in the states, I’d have enough after two years.
Snag an Apple Watch
Apple recently announced it’s new product: a watch. It’s not just any watch, it’s a smart watch, and it will be on the market in early 2015 for around $350. I could snag an Apple Watch in just under the average human gestation period, if I were so inclined (which I’m not).
Apparently, $40/month can go quite far! How’s that for an argument for picking up an extra couple of hours at work or starting a side business?