Broadband packages are cheaper than ever before, but that doesn’t mean those sneaky marketers have stopped trying to pull a fast one on you.
You’ve all seen the adverts promising lightning fast broadband for next to nothing, only to find the actual price far higher when you get round to signing up.
Here are the four most common fine print nasties to look out for.
Gimmick #1: The set-up fee
Also known as a connection or installation fee, certain broadband providers will charge you to activate your service.
This fee can be quite hefty – Talk Talk, Virgin and Sky charge £30 on a number of their packages – and what makes it more annoying is the actual "set-up" entails minimal effort or cost to the provider.
Often it’s just a way of beefing up their profits without increasing the headline monthly price. The good news is that ever-increasing competition in the broadband space means providers are increasingly forsaking this charge.
Gimmick #2: The rising monthly fee
Many broadband deals start off dirt cheap only for the monthly fee to rise dramatically a short time thereafter (usually three months).
A prime example of this is AOL’s Wireless Flexi package which offers an 8Mb line with a 10GB cap for £4.99 a month, which then triples to £14.99 after the third month. Tiscali’s basic broadband package has a similar gimmick, doubling from £6.49 to £12.99.
This is a fairly common practice among the larger players, so make sure you factor in this price rise when comparing packages.
Gimmick #3: The cancellation fee
Broadband contracts are getting increasingly lengthy, with 18 month deals becoming commonplace. A few providers are even locking customers in for two whole years.
Being tied down to one provider for so long means it’s quite likely that customers will need to cancel their contract at some point, but the fees are exorbitant – Talk Talk charges £70 and O2 £50.
Worst of all are the providers that force you to pay off the entire contract, such as Orange and Tiscali. This can prove unbelievably expensive – an Orange Home Max contract costs £24 a month and lasts for 18 months, so cancel early on and you could be out well over £300.
If you aren’t keen on a contract, AOL’s wireless flexi package may prove ideal. As we mentioned before, you’ll have to stump up £30 as a set-up fee and the price will rise to £15 after three months, but you are free to cancel at any time without penalty. Considering the size of fines elsewhere, this could prove a far cheaper alternative.
Gimmick #4: The nothing-for-free fee
If you purchased a car but the dealership expected you to pay extra to get the engine with it, you’d be understandably miffed.
Similarly, you purchase a broadband package because you want to surf the internet, but some providers don’t include all the necessary components in their “package” to do so, forcing you to pay extra. The wireless router is the most common omission, and can cost up to £50 if you have to buy it yourself.
Check if everything is included in the package before signing up, and factor in the cost of any parts you may have to purchase when comparing broadband deals. Note: It may also be worthwhile checking whether you get free anti virus software. It can prove quite expensive to purchase separately, but most providers now include this as standard.
Calculate the total, divide by months
There are a number of fees involved with broadband deals, and it’s unlikely you’ll be able to avoid all of them - no matter how much you shop around.
Your best bet is to read the fine print carefully, work out the total cost over the entire contract and then divide it by the number of months. This will give you an accurate indication.
If you’d like to read more about the specific broadband packages out there, click here.
http://www.everyinvestor.co.uk/personal-finance/utility-bills/how-to-find-the-best-broadband-deals
