If you want to save money on your household bills each month, you are going to want to cut the cord.
‘Cord-cutting’, is a phrase coined to refer to so-called ‘cord-cutters’ who have cancelled their costly subscriptions to cable or satellite television. These actions can result in some serious monthly savings.
As more and more people turn to the internet to get their TV fix, scrapping your satellite subscription doesn’t mean that you have to forego your favourite shows.
In this FIRE movement article, we take a look at the growing trend of cord-cutting and discover whether being a cord-cutter is really worth it.
What is cord-cutting?
The term ‘cord-cutting’ was originally used to refer to cancelling one’s subscription to, or to ‘cut the cord’ of cable TV. Although there are no real ‘cords’ connecting satellite TV to your house, the phrase now encompasses the cancelling of satellite subscriptions.
At one time, if you wanted more choice on your television, you would have had to sign up to cable or satellite companies like Virgin Media or Sky. Now, it’s possible to watch a wide range of shows on your TV without paying for a monthly subscription for satellite or cable television.
Why cut the cord?
Satellite TV packages in the UK typically start from around £25 per month. Depending on what you want to watch, this cost can rocket up to more than double that figure.
Are you paying for channels you don’t watch? Many of us only watch a select few channels on our costly subscription packages.
Watching television over the internet is not only a cheaper option, it’s also arguably better. By using streaming services like Netflix to get your small-screen fix, you have access to a variety of programmes and films you just wouldn’t be able to watch on ‘normal’ TV. They are also really easy to use. And, you can wave goodbye to costly, long-term contracts, too.
With all these benefits, it’s easy to see why so many people are switching from traditional Pay-TV, to the modern-day alternative.
Main reasons to cut the cord are:
- No long term contracts
- Save £100s a year on your household bills
- Watch TV shows at a convenient time for you…on any device
- Arguably more choice
Best way to cut the cord for TV
If you have any ‘must-watch’ TV shows/channels, check if they would still be available if you cancelled your satellite subscription. You can search where your programme of choice is available on JustWatch.
Make sure that the devices you want to watch television on are capable of streaming TV. Most modern televisions offer you access to the streaming providers’ apps. If yours doesn’t, you may be able to buy an add-on device (usually a set-top box or USB stick) that would enable you to stream on your TV. Otherwise, you could watch everything on your tablet or smartphone.
Now, you have a choice.
You can cut the cord and watch the free digital channels, either via aerial (Freeview) or satellite (FreeSat). And/or you can sign up to a streaming service for on-demand content.
Obviously, the savings are going to be bigger if you just opt to watch free broadcasts (remember, just like with your cable subscription, you have got your TV licence to pay for, too).
However, streaming is still cheaper than tying yourself to cable or satellite.
The basic Netflix plan, for example, costs £5.99 per month. That’s £71.88 per year. Compare this to a standard satellite TV package and you could be making savings of upwards of £228.12 per year.
Make sure your broadband package does not have a monthly cap. Otherwise, you could find that you are severely restricted as to how many shows you can stream.
Cutting the cord doesn’t mean you have to say goodbye to traditional TV channels
Even if you choose to switch to a streaming service to watch the television, as long as you have a TV and an aerial, you can still watch the standard channels, too.
If you have an older TV (pre-2010) that does not have a built-in tuner, you would need to purchase a Freeview box in order to do this.
Summary: save money by becoming a cord cutter
Do the calculations to find out how much you could save by cutting the cord. Whether you stick to the free-to-air digital channels or sign up for an on-demand streaming service, you could add £100s a year to your early retirement savings.