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9 questions to ask before buying a phone card

Want to come out the winner on a prepaid phone card deal? Here are some questions you need to ask:

Is there a connection fee? Some cards charge a low per-minute rate, but zing you with a fee every time you make a call. "It can be as high as $3 overseas," says Linda Sherry, spokeswoman for Consumer Action, a national nonprofit organization. But the typical card charges anywhere from 75 cents to $1.

Instead, "Look for a card with no [connection] fee," she advises.

What's the pay phone surcharge? Expect to pay it. It's still more convenient than pumping quarters into a phone, but keep it reasonable. Less than 50 cents is the optimum, according to Sherry.

Is there a minimum calling time? You may get an answering machine or just want to say "Hi-I'm-alive-bye." No matter how great the rate, the card is no buy if you make a one-minute call and get zinged for the price of five minutes.

Does the card use "rounding"? Similar to minimums, a company could round calling times to the nearest minute ... or the nearest three minutes. Find out ahead just how fast your carrier's stopwatch really is.

And the clock should not start until the party on the other end, or the voice mail, answers, says Howard Segermark, executive director of the International Prepaid Communications Association, an industry trade group.

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Are there daily, weekly or monthly fees? Some cards will deduct fees on a regular basis. This lets the company drain your card, whether you use it or not. Many states require that companies disclose these fees, and the legitimate ones will, says Sherry.

What's the card's expiration date? Just like milk and eggs, cards only last so long. Then your minutes, and your money, could evaporate. "It's not technically a fee, but it can really hit you," says Sherry.

And the shelf life on cards varies widely. Some last a scant two weeks, while others are good for two years. Look for one that is valid for at least six months, advises Sherry.

Are there options for "recharging" or paying for additional minutes? If so, how can you do it, are there any costs and will you still use the same fee schedule?

Is there a toll-free number to connect to the network or use customer service? And is it staffed? With phone cards, the name of the game is convenience -- and that means easy access to help for questions or concerns. Too many cheap cards either offer no customer service number or provide a number to a phone that just rings and rings, says Sherry.

Is the program user friendly? Face it, with some products you tear off the wrapper and you're ready to go. Others force you to jump through hoops -- wasting your time and money.

One thirty-something professional bought a card that required scraping off paint to reveal the secret pin code. The problem: once the paint was gone, the pin code was indecipherable. Remember, for a product to qualify as a good buy, it has to be easy to use.

-- Posted: June 23, 2003
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See Also
Getting a deal on a prepaid phone card
Getting a good deal on a cell phone
Frugal U. definitions
More Frugal U. stories

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