Recently, a friend of mine asked me how he could save more money on cable TV. I realize that he was just asking a general question about saving money. However, the first thought that ran through my head wasn’t which service provider he should switch to. Instead, I thought to ask him, “How much does cable cost in missed opportunities?”
Is Watching Cable Worth Thousands of Dollars?
The last time I can remember paying for cable TV was back in 2011. I was still serving in the US Army and was stationed at Fort Lewis, Washington. My justification for having cable TV was to help my wife cope with being away from her parents in South Korea for the first time in our marriage. I had hoped that by bringing some familiar channels into our home, she wouldn’t be so lonely when I deployed overseas. DirecTV had the best Korean channels, so I paid at least $100 a month for the international package.
In 2016, the average reported monthly spending on pay-TV service was approximately $103 based on a telephone survey conducted of 1,206 households throughout the United States. I realize that 1200 households are a small sample size of the entire US population. Frankly, for the middle-class, I’ll bet the actual dollar cost is even higher than $100 per month. How much are sports, movies, international, and other premium channels?
So … on average, people spend $1200 per year watching cable TV.
How Much Does Cable TV Cost in Missed Opportunities?
The problem with paying for and watching cable TV isn’t the cost in terms of actual dollars
There’s an even higher cost: missed opportunities.
According to the US Bureau of Labor Statistics, people age 15 or older watched 2.73 hours of TV per day on average in 2016.
- 2.73 hrs/day x 7 days/wk = 19 hrs/wk
- 2.73 hrs/day x 30 days/mo = 83 hrs/mo
- 19 hrs/wk x 52 wks/yr = 1000 hrs/yr
If watching TV truly brings you joy, then, by all means, continue. Some people watch a lot of TV as a family. It’s great if you’re watching an occasional movie or sporting event.
However, if you know deep down inside that you’re wasting your time, here are some ways you could be spending your time more productively:
- Learn. Take classes in person or online. Take online courses through Coursera, Udemy, or Linkedin. Read some books. Read some great blogs, like this one! ;).
A lifetime spent learning will likely result in better employment, relationships, and life in general.
- Exercise. If you don’t exercise much, could you spare 30 minutes out of your 2.73 hours a day to improve your fitness?
Get fit and stay fit and live a longer, healthier life.
- Cook. There are so many great recipes online that are easy to follow. You’ll be a chef in no time. YouTube is probably my favorite instructor.
Eating well goes hand-in-hand with health, fitness, and life. When you become successful, you might as well live as long as possible.
Do you have a 401K, IRA, or some other retirement account? How much is in it? If you are putting away at least $100 per month into a retirement account, good for you. However, you should be contributing the maximum every month.
Note: If you’re new to investing, read How to Invest in Stocks for Beginners – Part One.
If you don’t have much of anything in a retirement account, yet, but you’re spending $1200 per year on Cable TV…
Is watching cable TV really worth $1200 to you?
I don’t mean to beat a dead horse. I hope by putting things into perspective, you’ll see how simple it would be to secure a more comfortable future during retirement.
In the last 30 years, the S&P 500 has provided approximately an 8.6% annual return on investment (ROI). If you had invested the same $100 per month in the S&P 500 (like Warren Buffett recommends) in your 401K or IRA for the last 30 years, you could have built a retirement nest of nearly $159,000!
If you had invested $100 per month but increased it to keep up with the rate of inflation, you could have built a retirement nest of nearly $231,000 over the past 30 years!
“Past performance does not guarantee future results,” but I’ll take my chances on the S&P 500. We’re talking about $100 a month, folks!
3. Quality of Life
You may argue that watching cable TV is relaxing. I agree. But so is reading or spending time with friends and family (unless you have little kids who bring you both joy and misery due to their antics). If this is an area of life that brings you more misery than joy, I’m sorry.
If you absolutely must have some TV in your life, there are many great alternatives like Amazon Prime Video, Amazon Fire TV | Streaming Media Player, Apple TV, Netflix, and Roku that cost significantly less in terms of dollars spent. However, it’s still very easy to spend the same amount of time if not more consuming more content online.
Watching TV regularly might be relaxing and entertaining, but is it worth it? The opportunity cost is far greater than the actual cost of your bill. Over a lifetime, watching TV could cost you millions of dollars. I can do the math for you if you’d like. 😉
How much does cable TV cost you?
Please share with others and comment below. I’d love to hear your thoughts.