How Much Should You Pay for Internet?

April 11, 2020

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

Like water and electricity, Wi-Fi is one of your fundamental amenities, which means that it’s important to budget internet prices into your overall bills. But how much does internet cost? In this guide, we’ll highlight factors that influence internet cost per month, and 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, your internet package, and which type of internet you choose. You should shop around and see which company has the best available rates before signing a contract. Below are some of the steps you can follow to avoid overpaying for internet. 

Determine your internet needs

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 Wi-Fi 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.

  • Smartphone usage

  • Most apps require internet connection. If you and your family members are constantly scrolling on social media or sending messages, your internet usage will go up.

  • Transferring files

  • You’ll need internet access to transfer files to the cloud or share documents via AirDrop.

  • Video calling

  • Skype, Facetime, or Google Chat can all use up a lot of data. Video calling in HD requires about 1.5 Mbps.

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. 

What types of internet connections are available? 

Internet can be accessed from a variety of connections, and those connection types will influence your Wi-Fi 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. Speeds often don’t 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, and upload speeds typically match download speeds. The downside of fiber internet is that it is not always 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

What’s included in an internet package? 

When looking at how much internet costs, the internet package matters. An internet package includes several features, and each feature will influence the internet costs. Features that could be in the package include:

Internet speed

Internet speed is a measurement of how fast data travels from the World Wide Web to your device. The type of internet connection you use and the device you are using can impact your internet speed. 

Faster internet speeds cost more. If you choose a plan with a maximum internet speed of 40 Mbps rather than a 1,000 Mbps plan, you will pay more. It takes internet providers more resources to provide faster speeds. 

Wi-Fi availability

Wi-Fi technology uses radio waves to connect users to the internet. A wireless adapter (or router) allows anyone to connect to the network and easily access internet services. In order for Wi-Fi to be activated though, its router must be connected to the internet. 

Some internet providers charge extra for Wi-Fi routers, and even more for Wi-Fi availability throughout the home. If you have a larger home and you want Wi-Fi to be available in every room, then you will have to pay for Wi-Fi extenders. Wi-Fi routers and extenders will increase your internet costs. 

Data caps/allowances

Some internet providers have data caps, which limit the access users have to internet data each month. Plan holders that exceed the data caps are typically charged overage fees. Plans with high data allowances generally cost more than those with lower allowances. 

Internet providers will occasionally pair high data caps with faster internet speeds, so you should keep that in mind when determining how much to pay for internet. It costs more to have unlimited data with no caps.  

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. Those fees could include: 

Set-up

There may be a small fee to open an account with your new internet provider. The set-up 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 houses’ 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. 

How do I choose an internet provider with the best value? 

Now that you know what factors go into pricing internet, you’re probably wondering which one is the best for you. Here are the most popular internet providers, their general pricing, and other features to have some context as you compare the value of comparable packages. 

Xfinity

Xfinity

Starting at $60 /mo for 12 months

Plans Include

  • Speeds up to 100 Mbps
  • Includes 125+ channels

AT&T

AT&T

Starting at $40 /mo for 12 months

Plans Include

  • Speeds up to 100 Mbps
  • Data cap at 1TB

CenturyLink

CenturyLink

Starting at $49 /mo for 12 months

Plans Include

  • Speeds up to 100 Mbps
  • May require modem fees

Verizon Fios

Verizon Fios

Starting at $40 /mo for 12 months

Plans Include

  • Speeds up to 100 Mbps
  • Router fees may apply

Frontier

Frontier

Starting at $50 /mo for 12 months

Plans Include

  • Speeds up to 45 Mbps
  • No data cap

How can I lower 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.

  • Switch providers

  • If you take a look at other internet providers, you might find cheaper plans available. Ask the other providers if they have any incentives for switching, such as contract buyouts.

  • 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

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 monthly. Internet packages with faster speeds and other features can cost you upwards of $100 a month. 

How do I determine my internet needs?

Your internet needs depend on how many people are expected to regularly use your internet, 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. Satellite internet, and its consistently interrupted service, is best avoided. It’s better to pay more for your internet to get consistent, reliable internet that you can trust will always work. 

The bottom line 

Paying for in-home internet for your home need not drain the bank. It is an essential part of everyday life, whether you want to check emails at home, or stream your favorite show on Netflix or Hulu. When figuring out how much to pay for your internet, you need to consider how many people will be using the internet, and which activities you plan to do using the internet. 

Internet prices fluctuate depending on your internet needs and the type of internet you choose, such as DSL, cable, or fiber-optic. By bundling internet with other services, you can decrease the overall cost of your internet. The cheapest plans are usually around $30 a month, and the most expensive ones around $100. Ask your local internet providers what packages they have available, and then choose the one that best fits your needs.