Save By 'Bundling'

Americans are spending more than ever to stay connected through phones, television and the Internet.

But if you're tired of shelling out big bucks for these services, Saturday Early Show financial adviser Ray Martin says it's possible to trim your bills by simply doing a little research for better prices.

As cell phones, digital cable and broadband Internet connections are becoming more commonplace, the monthly bill for all these services can really add up.

A recent survey found that the average household spent $141.60 a month on its "telecom budget" last year, and many households spent closer to $180 a month. These numbers are up 35 percent from five years ago.

According to the Consumer Price Index, the money we spend on telephone services as a percentage of all money spent on goods and services is also on the rise.

Why the increase? Martin says part of the cost stems from our desire to be connected all the time, and to have more than just basic services.

But the story doesn't end there. Long distance companies are raising prices because they say prices dropped to levels that simply couldn't be sustained in recent years.

Also, Martin says, customers don't want to hassle with researching new options and changing their services. He says when customers try to find discounts for their services, they find the process to be too confusing.

So what do you do? Martin says you should collect all of your bills in one place. Take a look at what you're spending by looking at three months' worth of bills to get a good idea of your average costs. Then, look for places to save. He says to ask yourself: "Do I really need all the services I buy? Are some of my expenditures redundant? Am I getting my money's worth?" You may be surprised at what you find!

Here are Ray Martin's tips:

Look for Unexpected Fees

Martin says it's important to scan each bill for services you may not have requested but are receiving anyway. For example, many people pay a "wire maintenance" fee on their phone bills. It's mixed in with other mandatory charges and, because they didn't sign up for it, customers don't realize they can drop the $3 or $3.50 fee, which basically acts as an insurance policy against faulty phone wiring. However, these wires rarely go bad. Canceling just this one service can save $42 a year.

Identify Price Increases

While examining your bills, you may also find price increases that you were not aware of. Martin says most of us assume that companies will alert us to price changes, but long-distance companies, for example, are not required to do so - and most don't. The law says they only need to post a notice of changes on their web site. Martin says sometimes the changes may be hard to find on the web site.

Examine Bills Every Six Months

It may take some time, but Martin recommends examining all bills every six months. How you use your services may change and what companies offer also changes. Chances are, you'll always be able to find a better deal.

How to Save a Bundle

Martin says you can save a lot by obtaining all your services through one company. The practice is called "bundling," and most major companies such as Verizon and MCI offer these deals. Martin says although cable companies will probably offer you a deal for all TV needs and broadband Internet access, telephone companies are really offering the most-inclusive bargains.

Martin says customers may be getting great deals from "bundling." For instance, he says, Verizon's Veriations packages claim to save you $240 a year. Martin says if you sign up for their most expensive bundle, you will still pay less than you would if you bought each service (unlimited local calling with features, unlimited long distance, DSL, and wireless) from the company separately.

Martin says companies use these promotions to keep and gain customers. For the first time, the telephone companies are seeing a decline in the number of local phone lines, which may be caused by the increasing use of wireless phones and Internet phones. Also, customers are quick to leave service providers when they spot a more attractive deal. The companies see bundling as protection against both problems.

Martin says not everyone is happy with these deals, such as AT&T Broadband subscribers in Richmond, Virginia, who were told their monthly cost would rise $15 more if they didn't choose to also subscribe to any of the company's television packages. Some customers complained that this felt like blackmail.

However, Martin says if you're willing to sign up with one company, you really can save a bundle.