Business owners can save quite a bit of money if they are willing to go over their monthly internet and telephone bills, and do a little online comparison shopping. Some businesses overspend on phone service when they don’t need to, and if their phone and internet service are paid automatically via debit, credit card or automatic check withdrawal, they may never even look at their bills. There’s a reason that phone and internet companies want you to pay via automatic debit, credit or ACH, and that is because as long as you don’t see the bill, you don’t know what you’re spending. And spending like that can end up costing you your business.

The first bill that you should look at is your local telephone service provider’s bill. Do you use all of the lines coming into your office, and if so, how much are they costing you each month? Once you’ve counted your local lines, look at the bill and see which features each phone line has, and then decide if the features are worth what you are paying for them. Business phone lines, with local telephone service only, can cost up to $40 per line each month with some carriers, and if you’ve got lots of local business lines, they can really start adding up.

Once you’ve figured out the local phone service bill, look at your long distance bill and see if your long distance provider is providing you with a good deal on long distance service, or whether they are an expensive long distance provider . Also, check the long distance bill to see if there are any calls outside the US or Canada. Different long distance companies charge different fees for domestic and international calls, so a $1.99 per minute call to Afghanistan with AT&T may only cost $0.39 per minute with a discount company like Pioneer Telephone or Powernet Global.

Now that you can see what you are paying for the local landlines and for the long distance calls, look at the rest of the taxes and fees that are applied to your phone bill. In most US cities and towns, the taxes and fees on landline phone service are %25 to %30 of the total bill. So, if your phone bill was $100 for 2 or 3 local business lines, and $50 for domestic and international long distance calls, there might be an additional $40 to $50 in taxes and fees, for a total bill of around $200. Now, if I’ve got your attention, let’s take a look at internet phone service and see if maybe we can reduce that bill a bit.

Voice Over IP phone service needs high speed internet service, so there is going to be an additional charge for having high speed internet service coming into your office. If you don’t have high speed internet service, you can get 8 to 16 MB of internet service for around $60 per month or less. That much bandwidth can run a lot of phones and a lot of computer apps, especially when you consider a T1 line has 23 channels, and that’s only 1.5MB of bandwidth. In my office, I run 2 internet phones and 3 computers, plus pipe in Pandora for office music, all with an 8MB plan from Charter. (It’s in my house, so I only pay $29.95 per month.)

Voice Over IP phone calling plans themselves are cheap, coming in at between $19.95 and $79.95 per month, depending on which carrier you sign up with. Two of the digital phone companies offering cheap VoIP calling plans are Lingo and Phonepower. Lingo has unlimited calling to the US, Canada, and 45 other countries for $21.95 per month, while Phonepower has unlimited calling on 2 lines in the US and Canada for $19.95 per month. Both VoIP calling plans come with a ton of free features like conference calling, fax catcher and others, that would cost you extra from a landline phone company. And best of all, the taxes and fees on one of these plans is only around $3.00 per month.

If you check the price differences between landline phone service and VoIP phone service, VoIP phone service wins in most cases. You can get 3-4 VoIP phone lines from Phonepower for around $45 per month, including tax. Add to that the $60 for high speed internet service, and the whole bill comes to around $105 instead of the $200 that landline service would cost you. And, if you figure in the fact that most businesses already have high speed internet service, the savings increase to around $155, instead of $95, per month. Any way that you look at it, VoIP phone service in this case is going to save you $1100 to $1900 per year over what you would pay for 2 or 3 landlines plus long distance service, plus taxes and fees.

For more information on saving your business money, visit calling-plans.com and use their landline, VoIP phone service, and cellular phone rate calculators to compare cheap home phone service. I know that my small business can’t afford to give away $1500+ per year to the phone companies; Can Yours?