How Much Should You Pay for Internet?

June 11, 2020

“What’s the WiFi password?” We’ve all asked that question when visiting a conference center, a hotel or a friend's home. Access to high-speed internet has become an essential part of everyday life, especially in your own home. 

Like water and electricity, WiFi is a fundamental amenity, which means it’s important to budget internet price into your overall bills. But how much does internet cost? In this guide, we’ll highlight factors that influence the price of internet per month, as well as how to select the ideal internet provider for your home. 

How Much Does Internet Cost? 

Internet prices are dependent on several different factors. The cost depends primarily on the speed of the internet service, your internet package and which type of internet you choose. According to Leichtman Research Group, the average internet cost per U.S. consumer is $60/mo.

We recommend comparing internet service providers to find out which one has the best available rate before signing a contract. 

PROVIDERDOWNLOAD SPEEDS (Mbps)PRICE
15 to 2,000$29.99-$79.99
200 – 940
$49.99 – $99.97
200 – 940$39.99 – $79.99
100 or 940$49.99

What other fees should I expect?

When you’re comparing the costs of different internet plans, you should remember that the advertised price tag does not always include the full picture. There are usually fees that are slipped into the fine print of your plan. Keep your eye out for additional fees that could include:

Setup

There may be a small fee to open an account with your new internet provider. The setup fee covers administration charges, and it may be looped in with the installation fees. These fees are occasionally waived by providers, so there’s no harm in asking for it to be waived. 

• Installation

The cost of installation will depend on your house's pre-existing wiring. A technician will come to your home to properly set up your modem/router. The more work technicians have to do, the higher your installation costs will be. If you install the equipment yourself, you save on installation costs. 

• Activation

The activation fee is similar to the installation fee. It is the cost you pay to start your service. It is usually a low amount, and it may be included in the installation fees. 

Equipment rentals

Most internet providers expect you to rent a modem and/or router, and there is a monthly fee associated with the rental. You can get around equipment fees by purchasing your own equipment. 

• Early termination

When you sign a contract with an internet provider, you usually commit to a certain amount of time. Breaking that contract can be expensive. Some plans require you to pay for the rest of the contract, while others impose hefty fees. If you want to avoid early termination fees, choose a provider that lets you cancel whenever you want. 

• Overage fees

Some internet plans allow only a certain amount of data to be used. Plan holders that surpass that allotment could be charged overage fees. 

Your internet needs are also dependent on how many devices are using the internet, as well as how many people are on the plan. The more devices, the higher the speed requirements and the more expensive your average internet bill will be. You can estimate the general usage based on how many people live in the home, and what the expected usage is for each person. 

How Much Should I Pay for Internet?

If you are looking for an internet plan for the first time, or you want to change your plan, you might be asking yourself, “How much does WiFi cost?” Answer that question by determining your minimum internet needs. You should know what internet speed you require to perform your typical internet activities.

Internet speed is often called bandwidth, or the maximum data transfer rate. A larger bandwidth means that you can move data at a faster speed. It is usually expressed in bits per second, and most commonly megabits per second, or Mbps. Internet activities that require more bandwidth therefore take up more data. 

To get the optimum setup, you need to have a good grasp of the activities you and your family engage in that require internet. Activities that need an internet connection include: 

  • HD streaming

  • If there are multiple people streaming at one time, you’ll need a faster internet connection. HD streaming takes place on Netflix, YouTube, Hulu, Amazon, Facebook and any other streaming service.

  • Internet gaming

  • Playing games all night long? Xbox, PlayStation and other gaming systems can suck up a lot of bandwidth. Popular games like Overwatch, Fortnite and DOTA 2 use around 100 MB per hour of play.

What Types of Internet Connections are Available? 

Internet can be accessed from a variety of connections, and those connection types will influence your WiFi costs. The most common internet types are: 

Cable

  • Average download speed: 20-100 Mbps
  • Average upload speed: 7-50 Mbps
  • Starting cost per month: $20-$50
  • Pros & cons: Cable internet is known for its reliability and for achieving advertised speeds. Cable internet has relatively fast download and upload speeds. But, this type of internet can be vulnerable to electrical surges and heat damage. It can also have slower speeds during peak usage.
  • Top providers: Xfinity, Cox, Mediacom, Optimum, Spectrum

DSL

  • Average download speed: 1-500 Mbps
  • Average upload speed: 384 Kbps to 8 Mbps
  • Starting cost per month: $20-$45
  • Pros & cons: DSL has fast download speeds, but not the best upload speeds. It is widely available and is a common type of internet service. Speeds may not quite reach what providers advertise.
  • Top providers: AT&T, Frontier, Verizon, CenturyLink, Windstream

Fiber-optic

  • Average download speed: 25 Mbps to 1 Gbps
  • Average upload speed: 5-880 Mbps
  • Starting cost per month: $30-$65
  • Pros & cons: Fiber-optic internet is the fastest of the internet options, with upload speeds typically matching download speeds. The downside of fiber internet is that it is not yet widely available. Fiber is a new technology, and it is only available in a limited geography around the U.S. If you live in a rural area, you likely won’t be able to get it.
  • Top providers: CenturyLink, Verizon, Frontier, AT&T, Google

Satellite

  • Average download speed: 1-100 Mbps
  • Average upload speed: 1-4 Mbps
  • Starting cost per month: $50-60
  • Pros & cons: Satellite is an accessible internet option, but it is also slower than most of the internet types. Data has to travel a long way to satellites orbiting the Earth, and it can be interrupted or slowed down by clouds or other obstacles.
  • Top providers: HughesNet, Viasat

How Can I Save on My Internet Bill? 

If you’re interested in lowering your internet bill, test these tips to decrease the cost.

  • Downgrade your plan

  • One of the easiest ways to decrease your internet bill is to choose a plan with a slower internet. You might have to sacrifice some online activities, but those savings add up.

  • Bundle with other services

  • Consider bundling your internet plan with your TV or phone services. You’ll pay more each month for internet, but your overall bills will decrease. Plus, some bundled plans exclude upfront installation and equipment fees.

  • Pay attention to overages

  • If you are charged extra because of excessive internet use, you might want to cut back the hours spent streaming Netflix. Pay attention to your monthly bills and be aware of additional overage fees. Then, do what you can to minimize them.

  • Negotiate with your provider

  • You can always call your internet provider and ask if they can lower your rates. They might not be able to, but they could provide some tips that will save you money. 

Frequently Asked Questions on the Price of Internet

Below are some commonly asked questions about internet prices.

How much does internet cost?

Although costs vary, a basic internet package will likely cost you around $60/mo. Internet packages with faster speeds and other features can cost you around $100/mo. 

How do I determine my internet needs?

Your internet needs depend on how many people are expected to regularly use your internet service and what type of internet activities you participate in. According to the Federal Communications Commission, families with multiple internet users can get by with an internet speed between 12-25 Mbps. 

One strategy to determine your internet needs is to use a speed tool to see which internet speed you are currently experiencing. That number will help you gauge which plan you need. Remember that some activities, such as streaming video and online gaming, have higher needs and require a 5-10 Mbps download speed. Netflix recommends that you have a consistent internet connection of 25 Mbps or higher for viewing.

You’ll want to factor in some buffer room in the desired Mbps to compensate for slow speed days. 

Should I choose a plan without data caps? 

Most internet providers cap data usage at about 1 TB, which is plenty for the majority of users. Your internet plan will cost less if you have a data cap on your plan, so getting a plan with a data cap might be worth it. With that being said, you should check the data cap amount, because some internet providers have low data caps. If you surpass the caps, you will most likely be charged an overage fee. 

What type of internet connection is right for me? 

If you want the fastest internet connection, fiber-optic is your best choice. Unfortunately, fiber-optic internet connections are not always available in your town. If that’s the case, cable is usually your best bet. DSL is another great option for reliability.

The Bottom Line 

“Why is internet so expensive?”

We have all most likely asked this question at some point. Internet costs depend on your geographical location as well as your unique needs. It is important to understand what options are available in your area by reviewing the top providers researching services available at your address. 

Also, consider your internet usage needs. If you are an avid online gamer, your download speed needs will be much different than if you are a basic web browser. While it is important to get the speeds you need, be mindful of not paying for a lot more than is needed. Be sure when comparing internet packages that you are aware of fees that are not included in the monthly plan cost. Ask about data caps, too. 

There are a variety of internet service providers, offering different types of internet and speeds at a range of costs. By following the approach we’ve covered here, you will find an internet plan that is affordable and works well for your needs.