An Emergency Only Cell Phone: Pros and Cons of Petro-Canada Mobility

I understand that most of the world now has a fully-featured cell phone capable of accessing the internet, providing GPS coordinates, making phone calls, sending text messages and probably initiating the count-down launch sequence for an asteroid-blasting rocket capable of protecting Earth from another dinosaur-exterminating-scale impact. That didn’t stop me from wanting a cell phone
(a) from which I could call CAA and 911;
(b) that I wouldn’t care (much) if I lost it, destroyed it, or had it stolen; and
(c) that doesn’t cost much to have activated and ready to use.
The US (and most other countries) are full of these types of ‘disposable’ phones with appropriately-priced (read cheap) plans. Canada only offers a few. This is a review of some of the pros and cons of our Petro-Canada Mobility emergency only cell phone.

Why Do We have a PC Mobility Phone?

I’d love to say I did a detailed analysis of every cost, feature and fact about emergency cell phones and selected this one.

I didn’t.

We have a Petro-Canada phone because of a work situation for a family member which resulted in an incredibly huge number of Petro-Points being accumulated. Enough that it was simple to buy a Nokia and a year’s worth of activation plus some air time for “free” by using only a fraction of the points. Add to that an unexpected winter trip and the need for a way to call for help if even new snow tires couldn’t keep a grip and the decision was made.

What’s the Service Been Like with Our Petro-Canada Phone?

We’ve almost always been able to get a signal. Apparently, the carrier is Rogers based on the maps of available range.

We were unable to get a signal in some spots in the Cape Breton Highlands this summer but in other spots we could get through.

For southern Ontario highways and bi-ways we’ve had no trouble connecting to the network.

What Does the Airtime Cost?

Because this is an emergency phone we don’t get a monthly plan for it, although one is offered. Instead we buy blocks of airtime and activation.

For $100 we get 365 days of activation and $100 dollars of airtime. The calls are billed against this amount. As of December 2013, the calls are billed at $0.25 per minute for local and $0.50 per minute for long distance within Canada and the US. There is also a monthly charge for 911 service. In December 2013, that charge is $1.25 per month.

As of December 2013, outgoing text messages are

  • 10 ¢ to destinations within Canada
  • 15 ¢ to the US and
  • 35 ¢ to anywhere else in the world.

Incoming text messages are free.

If you buy a small block of minutes remember you will be paying the 911 fee even when you don’t use the phone so keep an eye on your balance. (Or an ear: they will send you a message when you’re getting low.)

Isn’t That a Lot of Money for an Emergency Phone?

Possibly. Frankly I think it’s insurance I am more likely to use than my regular auto insurance.

I consider the annual cost to be another type of insurance premium where I am betting I will need it and the insurer is betting I won’t. From that point of view, it seems a reasonable cost to me.

Does Airtime Rollover or Expire?

If you renew your phone before it expires, any balance of airtime dollars will carry forward into the new renewal time. If you forget to renew before the expiry date you will lose any dollars you still have.

I understand there’s a class action lawsuit brewing against one of the major Telecoms about this loss of air time. For now, though, there’s no law that says they can’t do this.

What Kind of Phones are Offered?

The cell phones are actually sold separately.

Remember that I wanted a phone that I could speak into and hear a reply? And that I could lose, destroy or have stolen without serious regrets?

I bought a bottom of the line Nokia with no keypad. I paid with Petro-Points but it cost about $40 to buy with cash a couple of years ago. It’s been working fine for years now and it keeps a charge for months.

I won’t list the available phones. There’s only a couple and they change from time to time. You can look at them on the http://mobility.petro-canada.ca/default.aspx site.

If you are also looking for this type of emergency phone I’d suggest looking at the phones offered with the lowest cost on the PC Mobility website. Then hop over to a review site like amazon.com and see what real people have said about that particular model.

Can I Just Buy a SIM Card from PC Mobility for my Old Phone?

Some people may have an older GSM phone they want to keep in the car as an emergency phone.

Yes you can buy a SIM card if your phone is unlocked. It has to be a GSM phone (850/1900 MHz.)

Usually you can get a SIM card for $5 at a Petro-Canada gas station. It usually costs more (about $15) to order one online.

There are no refunds on SIM cards, even if you find you don’t have the correct-type of phone after you buy it. If in doubt, talk to customer service *before* you buy the card.

PROs of the Petro-Canada Mobility Phone

  • No credit check is necessary.
  • No bills are sent. If you use up your dollar balance you can’t make a non-911 phone call and you can’t send a text message.
  • No roaming charges. OK, this one is a bit of a cheat. There are no charges because there’s no support for roaming.
  • Free incoming text messages.
  • Free voice mail.
  • Free caller id.
  • Free call waiting.
  • No system access fees. (There is an automatic non-deniable $1.25 fee per month for 911.)
  • No contract.
  • You can buy more minutes at Petro-Canada gas stations, but you will need to call a toll-free number to activate the minutes. Be sure your receipt is easy to read before leaving the gas station!
  • You can buy more minutes online if you register your phone.

CON: Very Limited Coverage in Low Population Areas

Because the phone uses the Rogers network, the range is definitely biased towards areas of high population like the corridor from London Ontario to Quebec City.

If you live, even along the TransCanada, in northern Ontario, there may not be any coverage. Check the map at
http://mobility.petro-canada.ca/images/general/coverage_national.pdf
if you don’t expect to use the phone mostly in highly populated areas.

(For comparison, here’s the Rogers GSM network map:
http://www.rogers.com/business/on/en/enterprise/rogers/coverage/ )
and the Bell map:
http://www.bell.ca/Mobility/Coverage_map

To be fair, it’s not really a Petro-Canada Mobility drawback. It seems both of the major carriers in Canada don’t care to offer decent coverage to areas with low population density.

CON: You Can’t Use the Phone in the USA

Unless you are close enough to the border to pick up the Rogers carrier signal, you can’t use this phone in the US. It has no roaming abilities.

CON: Local Call Rates Are High

I suppose it’s good that there isn’t much difference in the cost between a local call and a (US and Canada only) long distance call. Unfortunately, it doesn’t mean the long distance rate is low, it means the local call rate is high.

If you’re planning to make a call that’s longer than 2 minutes locally, it’s much cheaper to use a payphone for 50 cents, than pay the 25 cents per minute to use your cell phone.

Other Options to Consider

There are other providers to consider.

  • 7-11 stores are the physical location selling SpeakOut network phone services.
  • The regular Telecomm suspects all offer a prepaid phone service, including Bell and Telus.

Related Reading

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Do you have a ‘disposable’ cell phone instead of or in addition to your multi-purpose ‘real’ cell? Which provider do you use? Please share any cautions or concerns from your experience with a comment.

Should You Save For Your First Home in your TFSA or your RRSP?

As my faithful reader (Hi, Dad!) knows, I’ve been working my way through Gordon Pape’s How TFSAs Can Make You Rich. In it, he tries to deal with many of the most common questions about Tax Free Savings Plans, one of which is whether it’s better to save your down payment for your first home in your TFSA or in your RRSP.

Forget Where You Need to Save: Where Do You Need to Buy your First Home?

A close relative lives in a small town in northern Ontario where you can buy a house for about $17,500. The paper mill has closed. The mines closed long ago. There are not a lot of new people coming to town looking to buy.

Another relative, though, lives in the Vancouver area. I believe the monthly payment on her condo mortgage and fees is close to $1,750 given that most single family homes in her area cost about $750,000 now. So she’s spending about $17,500 each year for her home.

Obviously where you have to buy is going to affect how much you have to save.

Let’s Get Realistic: You Need to Save for your First Home in BOTH your TFSA and your RRSP

If you live in one of the real estate war zones you will need a fortune to buy a home. You can try to buy with less but if you do, you will probably end up very stressed and money will be tight. The Globe and Mail wrote about this recently in The rise of the miserable Canadian homeowner.

The most you can take out of your RRSP under the Home Buyer’s Plan is $25,000. If the home you want to buy costs $400,000, that’s only 6.25% of the price.

If you’re 23 or older, then the most you could have saved in your TFSA to the end of 2013 before growth is $25,500. That’s another 6.375%.

Don’t forget on a $400,000 home you may be expected to pay about $10,000 in closing costs. That’s another 2.5% you need to find somewhere.

Closing costs include provincial land transfer taxes, and if you’re in Toronto: municipal land transfer taxes. They also include lawyer’s fees, bank and mortgage fees, title fees, paying back any pre-paid property taxes, paying to start new accounts with utilities, etc.

You do know that you are probably going to have to pay $4000 a year or so each and every year in property taxes, right? Will you have the money for next year’s taxes sitting in the bank after you’ve paid for your home?

I think you need to save for your first home in both your TFSA and your RRSP.

A Purely Numerical Reason to Save for your Home in your RRSP

In his book, Gordon Pape runs some numbers to see if there is a simple financial advantage to saving for your first home in your RRSP or your TFSA. Based on contributing $3500 a year in before-tax income, it works out that you can save the $25,000 for your home in 6 years using a RRSP and in 8 years using a TFSA. (The actual math is a bit complex: check the book if you want the details. And remember he’s assuming you take advantage of the higher rate of contribution to the RRSP because you can use “before tax” money. )

So if your goal is to get a down payment accumulated faster, using the RRSP is the winner.

And if you have to buy in a ghost town in northern Ontario, your RRSP is the perfect place to save the entire purchase price.

For many of the rest of us, though, as I’ve said at least twice before: I think you’ll need to save in both.

Did We Save in Our TFSA or Our RRSP?

We’re ancient. There were no TFSAs when we were saving for our first home. We did, however, save both in our RRSPs and in our regular bank accounts.

Related Reading

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Are you saving for your first home? What strategies are you using to try to get there sooner? Please share your views with a comment.