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Money-Saving Tips on Phone Services

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If you're not already using a VoIP (Voice over Internet Protocol) service for your local and long distance calls, you should be. Internet-based phone services, such as those provided by Vonage and Packet8, can cut your monthly phone bill by as much as 50%. You'll need a broadband Internet connection before signing up, but in exchange you'll get a variety of free features like unlimited nationwide calling, call forwarding, and caller ID — features that Ma Bell would otherwise gouge you for. Below we'll take a look at some of today's best money-saving VoIP plans.

Vonage: With plans starting at $14.99/month, Vonage has become the poster child for VoIP. The 7-year-old company provides a good amount of features, including support for e911 calls (a technology that locates the origin of your 911 call), call forwarding, and unlimited international calling plans. The latter, however, requires that you sign up for Vonage's $24.99/month Unlimited Residential plan, and adds between $6/month to $10/month depending on which "World Plan" you choose. To save extra money, we recommend calling Vonage Customer Care at 800-706-9830 and inquiring about their unlimited annual plan, which sells for $239.99 ($19.99/month). This plan is not advertised on their website, but would save you about $60 a year.

Packet8: They may lack Vonage's popularity, but Packet8 offers similar rates to Vonage with a $24.99/month unlimited plan and $14.99/month 500-minute plan. However, opt for Packet8's annual unlimited plan at $199/year and you'll save $40 when compared to Vonage's yearly plan. Need to lower your cellphone bill? Packet8 also offers MobileTalk, a free app for your smartphone which routes international calls made on your smartphone to Packet8's network, so you save money when calling countries outside the United States. (You can browse through Packet8's international calling rates here and find a list of supported smartphones here). Sign up for this service is currently free, i.e. no activation fee, though you'll still have to pay Packet8's international rates per call.

ViaTalk: Bargain hunters looking to get the most from their money can sign up for ViaTalk's VT Unlimited Calling Plan for $199/year and receive a second year for free. This includes two lines of service, which would otherwise require an additional charge. You'll need to pay a $30 activation fee, along with a $10 fee for the required Linksys VoIP adapter, but to date this is the best VoIP plan we've seen. Feature-wise, the plan includes e911, caller ID, call waiting, call forwarding, and more.

Skype: Have a lot of tech-savvy friends? Don a headset, sign up for a free Skype account, and you'll never pay for a call again. This PC and Mac-friendly app lets you make free computer-to-computer-based calls using your broadband Internet connection. You'll be tethered to your PC (unless you splurge for a wireless headset or cordless Skype phone at the Skype Shop), but call quality is, for the most part, reliable and you can even make conference calls (although conference calls can sometimes break up depending on how many people are included). For $2.95/month, you can upgrade to Skype Unlimited, which lets you make unlimited, nationwide calls from your PC. To receive calls, you'll need to sign up for a Skype number for $60/year.

magicJack: At $39.95/year, magicJack is one of the lowest-priced VoIP services we've seen. The company offers a free 30-day trial and you can currently purchase an additional year of service for just $19.95, which is what some VoIP providers charge per month. The only catch is that you'll have to keep your PC or Mac on all the time, as the service relies on a small USB dongle (included in price) that connects to your computer and phone simultaneously.

As you can see from the list above, there are no reasons to stick with a calling plan from Ma Bell. There are enough VoIP options for every type of user, whether you're constantly on the phone or not. To save the most money, purchase a yearly plan from ViaTalk. Not only is it less expensive than Vonage and Packet8, but the company also throws in an free bonus year. If your computer is on 24/7, you can save even more money by choosing a provider like Skype or magicJack, both of which offer plans lower than the average VoIP provider. No matter what provider you choose, there's a good amount of money to be saved once you switch over to an Internet-based calling plan.

Louis Ramirez is dealnews' Features editor.

Please note that, although prices sometimes fluctuate or expire unexpectedly, all products and deals mentioned in this feature were available at the lowest total price we could find at the time of publication (unless otherwise specified).
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