Mellody Hobson: Getting a Grip on Cell-Phone Bills

Aug. 18, 2005 — -- As you get ready to send your children off to college or back to school, it's an excellent time to take a hard look at their cell phone bills and plans.

According to the Cellular Telecommunication Industry Association, the average monthly cell phone bill is now $50.94. But this number is much higher for families with teens, who are often going above and beyond their plans and text messaging with friends via their cell phones at a frenzied rate. According to NOP World Technology, 44 percent of 10- to 18-year-olds in the United States now own a cell phone.

Text messaging via cell phone has become a teenage craze. Recently, a student in New Jersey rang up a $1,058 bill in a month and a half thanks to the more than 12,000 text messages she sent to her friends throughout the school day.
According to Forrester Research, Americans sent 2.5 billion text messages a month in 2004 -- more than three times a many as in 2002. And these text messages are not cheap. Many plans charge between 5 cents and 10 cents for each message a user sends and receives. A typical teen sends about 21 messages a week -- at 10 cents a message, that adds up to more than $109 a year in fees!

In addition to text messaging, teenagers are increasingly accessorizing their cell phones by purchasing ring tones of popular songs and buying mobile games. In 2003, the ring tone industry reached $300 million in the United States, with people under the age of 25 representing the largest segment of buyers. While some ring tones are free, others can cost $2.99. Teenagers often download games to their cell phones at a cost of $3.99 to $5.99 -- another significant extra that can add up quickly.

According to an ABC Consumer News report, more than 16 million cell phone users in this country go over their minutes each month, mostly because they are not aware of how many minutes they have left. This additional talk time can cost anywhere from 30 cents to 45 cents a minute. Extra minutes can quickly add up, and depending on the wireless carrier and service plan you purchase for your teen, your bill could easily double.