Cable is an unnecessary expense that feels necessary. At the end of a hard day, it is comforting to flip on the TV and watch a mindless hour of entertainment. As salaries drop and jobs becomes scarce, however, many people are feeling the pinch and need to save money every month. Completely getting rid of cable seems drastic; lowering to a basic plan seems like a waste of money. What is the best route for saving money every month: cancelling cable, or strategically altering your plan?
Doing the Math
Let’s assume your cable bill is $75, which was the 2010 average for digital cable and satellite users. $75 times 12 months is $900 a year. Completely eliminating cable, however, would usually be replaced with DVD purchases. Assuming you rent 1 DVD a week at $4 each, that comes out t0 $16 a month, or $192. This might seem like a good deal until you realize that you don’t get to keep those DVDs – so you don’t have constant entertainment. To build up a DVD library, let’s assume you purchase a used DVD for $8 each week. That comes out to $32 a month, which is about $10 more a month than basic cable. With basic cable, you get to watch a variety of shows; with the DVD, you only get to watch the same shows over and over again.
It would seem, at first, like keeping basic cable makes more financial sense unless you want to completely cut out video entertainment.
There is an alternative, however. You can cancel cable and use the money you save to purchase a low-end desktop for approx. $400. This computer can then be connected to the TV and the Internet. Many network stations have put their shows online for free, such as NBC, CBS, ABC, Nickelodeon, etc. In addition, you can get a Netflix account for $6.99. This Netflix account will give you access to their ‘Watch Now’ video library, which includes thousands of TV shows and movies. If you find a used laptop, the total cost could be less than $300.