Inopportune mobile, internet plans cripple Soldiers' cash flow
September 9, 2011
BAMBERG, Germany -- The proverb "if you don't know, you better ask somebody," emphasizes the need for a person to educate their self about something, but asking just anybody about mobile phone and internet plans in Germany could be a costly mistake.
"It can cost you a lot of money to make an uninformed decision," said Jose Piedade, a volunteer for Bamberg's Army Community Service Financial Readiness Program.
Newcomers often trust counsel they are given about services by a salesperson or by somebody who responds to their questions on social media, but Piedade said that listening to people's advice without having the facts can lead to financial hardship.
"Most of the times people will trust the information without any validation," he said. "You should always check your sources."
To help Soldiers, family members and civilians new to Bamberg make a financially wise decision on choosing a service plan, Piedade built a database full of service providers' plans to help consumers better understand mobile phone and internet service contract costs.
Before newcomers sign a phone service contract, they should stop by ACS and view the database Piedade assembled, said Eugene Woods, Bamberg's Financial Readiness Program manager.
The database provides users with a cost estimate on mobile phone plans offered by Vodafone, Telepost Kabel-Service, O2 and T-Mobile. Mobile phone contracts in Germany are 24 months and it is almost impossible to get out of the contract.
"Awareness, education, and preventive measures are key components to the Financial Readiness Program," Woods said. "Please understand that the telephone communication information changes rapidly. The information that Piedade is providing should help Soldier(s) and family members to make an informed decision about the telephone and internet services while living in Europe."
Newcomers started receiving briefings on the database Aug. 16 at Inprocessing Training. Newcomers can put in estimates for categories like local and international calls, text messaging and data use. The database then recommends a plan that best suits the needs of the consumer.
Piedade also has a hard copy of the plans, so that people can view the plans' details and see for themselves what is in the fine print, Piedade said. Reading the fine print on a plan is always one of the most important things to consider. This is where one can find additional charges, restrictions and stipulations.
"Some companies will sell a plan that the infrastructure can't support," Piedade said.
An example would be a company selling an internet plan where people will pay a premium to get data speeds that exceed 10 megabits per second, but the infrastructure only supports five mbps.
"You're never going to get that speed," Piedade said. "It's fast but you won't get those speeds here in Bamberg."
Besides selling a plan that the service providers can't support, providers also have additional charges that can be a financial burden on Soldiers, family members and civilians, he said.
"It is very common to have people here paying between , 60 and , 100 at month," Piedade said.
Some people have had to pay as much as , 1,400 a month, which equates to more than $2,000 with the exchange rate, Woods said, Bamberg's Financial Readiness Program manager.
"There is a lot of confusion out there about plans," Woods said. "Anyone coming here to Europe needs to understand that the phone system is different than in the states. They need to be aware of what is available. Just a little research can save hundreds and hundreds of dollars."
As Piedade likes to point out, the research is already done for community members; they just need to visit ACS to get the information.
While Piedade believes it's important to get all the facts about a plan and use a prepaid phone before signing a contract, there is one other thing people should understand before signing a contract.
Many people make impulsive decisions on plans based on a phone, Piedade said. Making a decision on a plan based on the kind of phone one wants can also lead to expensive bills.
"Although more expensive, the smart phones sales shows us a trend of consistent growth and progressive penetration in the cell phone market," Piedade wrote in his analysis report one mobile phones in Europe.
According to some of Piedade's research from www.umtsspeedtest.de, 45 percent of new sales come from smart phones and plans for a smartphone can be more expensive.
Piedade said Soldiers, family members and civilians who would like to learn more about service provider plans in Germany should contact the Financial Readiness Program.