9 Hidden Costs of a Smart Home

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Having a smart home comes with some great benefits such as improved security, potentially saving money on your energy bill and even just a more convenient lifestyle for you and your family.

There are concerns around how much extra you will have to pay in electricity usage and whether there are any hidden subscription fees associated with certain products that you need to pay in order to get the most out of it.

These do exist, but are they really worth worrying about and should they stop you from setting up your own smart home?

Here are 9 hidden costs of having a smart home that you may not have considered but are still worth keeping in mind.

1. Electricity

Probably the biggest concern around the cost of having a smart home is the massive electricity bill you will find yourself running up each month.

This is a valid concern and one that made me think twice about using certain smart devices around my home, but it turned out I didn’t really need to worry at all.

In reality, most smart devices use very little electricity and won’t cost you much to run each month.

A good way of being able to work out how much electricity each of your devices use and how much this will ultimately cost you each month is to use a smart plug that also monitors energy usage.

Certain appliances like air conditioners, a refrigerator or a clothes dryer will cost quite a bit each month to run compared to a smart light bulb or a home security camera, but most homes will have these regardless of whether they are smart or not, so it isn’t really fair to include them in this assessment.

Something to consider if you are still worried about the electricity costs in running a smart home is that you could find yourself actually saving money in the long run.

A smart thermostat could automatically adjust the temperature to save you wasting money on heating when it isn’t needed, and smart bulbs use LEDs which are considerably more energy efficient than incandescent bulbs.

I would go as far as to say that you would save more money by having these devices and improving the energy efficiency in your home than you spend on the electricity to run them.

I did some research into a few different commonly used smart devices to find out how much electricity they use, and how much they would roughly cost you to run if they were used 24 hours per day for an entire year!

It might surprise you to not be as much as you would think.

DeviceDevice TypeElectricity UsageApproximate Cost Per Year
Amazon Echo DotVoice Assistant/Speaker1.7W – 3W$2.63
Philips Hue BulbSmart Bulb1.7W$1.79
TP-Link Kasa HS110 Smart PlugSmart Plug3W$3.16
Wyze CamCamera3W$3.16

2. Batteries

Most smart devices will use the mains electricity for power, but there are some that will rely on batteries.

Mainly smart sensors and smart door locks; smaller devices that don’t require as much power and would be inconvenient to run mains power to.

A typical smart door lock will require 4 AA batteries, but don’t forget this is doubled if you decide to have one on the both the front and back doors of your home.

CR2450 lithium coin batteries are used to power the sensors as these are relatively small and don’t require much juice to run.

The more sensors you have around your home, the more you will have to spend on batteries.

They do last quite a long time though given how the sensors aren’t doing a great deal of work in the grand scheme of things, so this shouldn’t be too much of a worry.

Just make sure you keep a spare pack of both AA and CR2450 batteries just in case. Having just one battery die and not having any replacements to hand could result in some of your automations not working, which would be very frustrating.

3. Wi-Fi and Data Usage

Before going ahead and buying a bunch of smart devices, consider the amount of data that your Internet plan allows you to use.

Most smart devices don’t use very much data but there are some that have the potential to chew threw your data allowance.

If you are on a limited data plan, you could find your smart devices contributing towards going over the limit which could result in an even larger bill to cover the over usage fee.

Also consider the apps on your smartphone that interact with your smart devices. Many of them will use lots of data to communicate with each if you are away from home and using your mobile data instead of Wi-Fi.

Thermostats, cameras and doorbells are those that will use considerably more data compared to other smart devices.

Another concern some people have is around whether too many smart home devices will slow down your Wi-Fi.

The short is yes; smart devices can slow down your Wi-Fi connection and the speed in which you can connect to your entire home network.

It’s not all doom and gloom though as it does depend on the type of devices you are connecting and how many you have connected at once.

The like of smart light plugs, switches and other similar device won’t impact your Wi-Fi speed unless you are using a ton of them, and I’m talking 20 or more running at exactly the same time.

Realistically, modern home networks can easily cope with as many as 200 devices connecting to it without affecting the Wi-Fi speed. It’s only when you have lots of devices consuming a large amount of bandwidth at the same time will you perhaps notice a slight drop in speeds.

My advice in regards to data usage would be to make sure that you are on a sufficient data plan on both your Internet package at home and your smartphone.

Many people will prefer to not have to worry about going over their usage at home and opt for an unlimited data package, but the data plan on your smartphone should be something to still consider as most people will have a limit.

4. Time

Setting up and maintaining a smart home will not only cost you in terms of having to spend money, but it will also require a bit of time investment.

Thankfully the likes of Alexa, Google Home and even to some extent, SmartThings, are relatively quick and easy to setup.

They don’t require much prior knowledge and the user interfaces are well laid out to make navigating them straight forward.

Even setting up several different automations themselves don’t take much time; some simple automations beginners may like to setup such as a light being switched on when motion is detected will only take a minute or two.

Depending on how many automations you plan to setup and how complicated they are will determine how much time you will need to invest. Even more may be needed if you go down the route of manual coding some automations, especially if you need to devote some time to learning it in the first place.

The biggest time investment will be in setting up the automations; maintaining them doesn’t really take much time.

I would estimate you only need to spend between 30 minutes and an hour a month tweaking your automations or perhaps improving them as you add more devices to your smart home.

setting alexa routine

5. Subscriptions

Several security camera and video doorbell manufacturers are notorious for not only charging you a pretty penny for the device itself, but also a subscription for storing of all the footage.

Don’t be surprised to purchase either a camera or video doorbell and also have to pay for cloud storage. In the grand scheme of things, it doesn’t cost a huge amount, but it is still an extra expense regardless.

Some manufacturers will charge you a monthly fee in which you either have a limited or unlimited amount of storage on their cloud-based servers, whereas others will charge you a fee per device.

Several of these around your home could result in you having to pay more in subscription fees than it cost you to buy the device itself!

There are some manufacturers like Wyze who don’t charge a subscription fee for you to store your recordings, but you will often have less time in which you can access them before they are deleted and they aren’t as easy to get a hold of.

I’m generally not a fan of monthly subscription fees and would rather pay for something outright and be done with it, but I can see how it would be worth it in the case of storing footage from a security device like a camera.

For as little as $3 per month, I would be happy to pay this knowing my recordings are kept safe and are easy to access.

DeviceDevice TypeSubscription Cost
Ring Video DoorbellVideo Doorbell$3 per month
Nest HelloVideo Doorbell$5 per month
Wyze CamCameraNone
Arlo ProCamera$3 per month

6. Family Dynamic

There is no denying that having a smart home with lots of different devices in every room has the chance to affect your family dynamic.

So much so that I consider it a cost associated with setting up a smart home that definitely needs to be kept in mind.

I speak from personal experience as my partner is often not a fan of some of my proposed automations, but thankfully she is often accepting and lets me carry about my business.

Here are a few tips when it comes setting up home automations whilst living with others.

Firstly, take it easy on the automations. Slow and steady will definitely pay off here.

Rather than shocking your spouse when they open the credit card bill to see you’ve spent a lot of money on different smart devices, take it easy and start off small.

Don’t go setting up a load of complicated automations straight away. Start off simple so your family can see the benefits that the automation brings and how easy it is for them to live alongside it.

Going with this approach will likely result in others being much more accepting in you wanting to setup the ultimate smart home and will be happy for you to add more automations in the future.

Also make sure to actually run past your ideas with the others in your household before implementing your automations. I can see why they would be pretty annoyed if they suddenly couldn’t do something as simple as switching on a light because you haven’t told them about your plan beforehand.

The take home message here is to start off slow with the automations and always check with the others before putting them in place.

The phrase “happy wife, happy life” sure does apply when it comes to setting up a smart home.

Trust me!

family dynamic

7. Router

Depending on the size of your smart home and how many devices you have setup, you could find that your router becomes the bottleneck in the entire setup and severely limits the operation of all your automations.

Many smart devices will operate over Wi-Fi, so each device you add will have a strain on your router, no matter how small.

This strain can add up over time and result in the router not being powerful enough to cope with everything being asked of it, not to mention all the non-smart home jobs it has to do.

Often the cheaper smart devices will also only operate on the 2.4 GHz band, which can get quite busy as you add more and more devices.

A tip if you have a dual band router would be to keep the 2.4 GHz band in reserve for all your smart devices wherever possible and use the 5 GHz band for your other devices like your PC or laptop wherever it is supported.

It might also come to a point where it is worth looking at upgrading your router.

Those supplied by your Internet Service Provider are generally not very good. They don’t support a huge number of connections and the Wi-Fi coverage they provide is pretty poor.

If you do decide to purchase a new router to better support your smart home, my advice would be to get one that is at least dual-band and can support a high number of connections. One that supports MU-MIMO technology can also be beneficial as they will allow multiple connections at the same time.

8. Trying Different Devices

With the huge number of different smart devices available these days, it can be tricky to know if the device you decide to purchase will actually do what you want it to without actually having it and trying it out.

There have been a number of times where I have bought a smart device only to find out it wasn’t quite what I was looking for, no matter how long I spent researching it and reading different reviews.

This is just something you need to accept as you build your smart home; you’re unlikely to get it right first time, every time.

There will be a cost in terms of time and money in researching and buying different products to test; it’s just part of the game unfortunately.

If you do purchase a device that isn’t what you were expecting, don’t despair and chuck it straight in the bin. Instead, try and sell it.  If it hasn’t really been used much you will be surprised in how much money you can recoup back and put towards trying an alternative device instead.

You are very unlikely to get all your money back through the sale, but even a small amount will help cushion the blow a bit.

9. Privacy

Although this is not something I am personally too concerned about when setting up a smart home, I completely understand that some can worry about the different devices affecting their privacy.

There are doubts around whether your voice assistant is always listening in on you, even when muted, and what is done with the voice recordings that are being logged.

Off-brand labels have been known to be relatively easy to hack, so there is also a worry that an entire home network could be hacked all because of one vulnerable device.

Also worth mentioning is the very valid concern of having certain devices around the home when kids are around.

Everyone has their own opinion when it comes to privacy in a smart home so my only advice is to thoroughly research each device you are looking to use if you have concerns over your privacy and make your own decision as to whether it is worth it.

Final Thoughts

As you can see, there aren’t that many hidden costs associated with having a smart home.

Other than the small cost of electricity, needing to purchase batteries every now and then, and possibly needing a subscription to store the footage from your security camera or video doorbell, you don’t really have to pay for anything extra on top of the device itself.

The other costs don’t necessarily have a monetary value associated with them, but they are worth keeping mind, nonetheless.