Telstra’s Taking Advantage Of Increased Prices vs Yearly Inflation

Let’s look at a real example of companies’ charging more for something. In 1999, every person in Australia with Telstra was charged $9.95 for their line rental for a home phone. Then they were charged for phone calls on top of the $9.95.

Now in 2010 Telstra has many different plans. However their most popular plan according to their website is the Homeline Plus plan. The line rental is $29.95, and of course your phone calls are on top of this.

It is quite simple to work out, that over the last 11 ½ years since Jan 1st 1999 to June 1st 2010. This line rental cost has gone up on average 10.5% each year! This is despite inflation only going up on average 3.2% over this time (Reserve Bank of Australia figures).

This means if you were earning $35,000 in 1999 and you paid $119.40, 0.34 percent of your wage would be used to pay the Telstra line rental.

If you got a 3.2% pay rise each year from 1999 to 2010 you would now be earning $49,493 and pay $359.40 for Telstra line rental or 0.72 percent of your total wage. This is up over double compared to 11 years ago.

Can you see how you have to watch your bills? By saving your bills and receipts, putting them into a spreadsheet, it is quite easy to go back to your costs for last year and see how much certain bills have increased. If you notice bills going up and up by more than inflation, you need to be on top of this.

Talk to the companies. Tell them you want a discount. Find out how to reduce your bills. Change plans to one that will save you money. Or if you can’t save money with the company you are with look for a new one. Go to someone that will appreciate your business more. Plus only raise your prices with inflation or just above inflation.

My insurance company is on its last warning. If my bill comes in above inflation next year, we are going to part ways. And as for Telstra we got rid of them long ago!