With Tax Deadline Day officially behind us for another year, we accountants are rejoicing the end of (and surviving!) another busy season. The non-accountants of the world are rejoicing for another reason: The average American will receive a tax refund of $3,000 in 2012.
Before you go out and buy the latest and greatest electronic gadget with your refund, remember there are often additional costs associated with these. As a recent AICPA survey of over 1,000 U.S. adults noted, technology has made it easier to spend than save.
As a large part of accounting is examining cost/benefit relationships, I decided to review my different technology vices to see if the costs outweighed the benefits, and here’s what I found:
Cell Phone: I was spending $60 per month for just data on my cell phone. Upon review of my data usage, I found that I was using less than 20% of what I was paying for! Needless to say, I switched to a lower data plan that now costs me only $30 per month, and I still don’t use all the data available on my plan.
Cable TV and Internet: I took a closer look at what exactly I was paying the cable company for, and found that I was subscribing to a cable package that included premium movie channels, which I rarely watch, costing me an extra $25 per month. The cost of the movie channels far outweighed the return.
As for internet, compare the package to what you actually use the internet for. If you use it to check e-mail and Facebook, the most basic package would suit your needs. If you can’t get enough of playing Call of Duty online, you may well be able to justify the supersonic internet speed.
Subscription Services: Many technology companies now offer monthly subscriptions for their services. The two most well-known subscription services are Netflix, and satellite radio. As a long-time subscriber to both, I have found ways to save on both of them.
If you keep these tips in mind, you can assure yourself that you won’t be using next year’s tax refund to be paying off debt racked up by your electronics!
* Thank you to Mike Effler, Assurance Staff for his contributions to this post.