T+L’s personal finance columnist, Jean Chatzky, answers your questions.
Stephen Campbell Money 6/07
| Credit: Stephen Campbell

Q: I will be traveling abroad in the next few months and am wondering how I can avoid an expensive hotel phone bill. What are my options?—Lisa Jordan, Seattle, Wash.

A: It’s no secret that hotels charge you an arm and a leg—a 100 percent markup is not unusual—to use their phones. Prices vary widely, but a call to the United States can run as much as $2.09 for one minute (at the Grand Hyatt Tokyo) or a whopping $5 per minute (at the Ritz-Carlton Istanbul). And local calls can cost upwards of 61 cents. Here, a few alternatives to ensure that your bill doesn’t have extra charges that could have been avoided.

Buy a calling card

You can get an international calling card from your long distance carrier (charges appear on your regular phone bill) or another U.S. carrier (billed to your credit card), or you can purchase a prepaid card. Rates are usually a fraction of the fees at hotels. For example, AT&T charges 13 cents per minute from the United Kingdom (it’s $1.69 at the London Marriott Hotel Grosvenor Square). However, note that even if you use a calling card, hotels may charge a fee just to use their phones to reach a toll-free or local access number.

Make your calls over the Internet

Internet phone services—also called VoIP (Voice over Internet Protocol)—such as Vonage and Skype allow you to download software and use your computer to make phone calls. With a microphone headset, you can speak through your laptop; Vonage also includes a slim, portable adapter that lets you plug directly into the phone in your hotel room. Downloading Skype is free, as are calls to (and from) other Skype users. Calling non-Skype users costs pennies per minute and is billed to your credit card or PayPal account. Vonage is $25 per month for unlimited calls. For both, you will need to have broadband Internet access. Sometimes that’s free in your hotel, as at the Grand Hyatt Tokyo, and sometimes not (it’s $40 for 24 hours at the London Marriott Hotel Grosvenor Square). Both Skype and Vonage allow you to sign up for "virtual" phone numbers, which allow incoming calls. That’s a boon to friends and family, who can call you at local rates.

Use a cell phone

To avoid steep roaming charges, you’ll need an unlocked GSM mobile phone that works on 900 and 1800 GSM frequencies, and a SIM card to connect with a wireless carrier in your destination. Outgoing calls are billed at local rates, which vary based on where you are calling and time of day; incoming calls are free. You can buy a SIM card before you go (about $25) or purchase one through a local provider, like Vodafone in the U.K. ($5). SIM cards can save you money if you will be making a lot of local calls; as for the occasional dinner reservation, leave that to the concierge.

Additional reporting by Arielle McGowen


Internet Phone Services

Calling Card and Sim Card Providers

Telestial (www.telestial.com)
Planet Omni (www.planetomni.com)
Cellular Abroad (www.cellularabroad.com)