Is Protecting Your Home Worth the Cost of a Security System?

May 11, 2016

Photo credit: maxkabakov/iStock/Thinkstock

My two dogs, Fluffy and Fifi (names have been changed to protect the vicious), spend all day, every day, guarding my house. If an unsuspecting bunny or a well-intentioned Lassie out for a walk comes within 500 miles of my yard, Fluffy and Fifi bark so ferociously that the ears of the astronauts on the International Space Station probably perk up.

While a barking dog is a proven crime deterrent, I wondered if we would be better served by another system. It might take some of the pressure off my dogs so they could focus on what’s really important, like covering every inch of the house with hair and searching for microscopic crumbs on the high chair.

I like the idea of knowing that my home is always protected, but is that protection worth the cost of an alarm system?  I took a look at some options.

Monitored Alarm System

This type of system includes central monitoring that connects to emergency services. If an alarm is triggered, the alarm company will contact you. If they are unable to contact you, or your designee, the company will contact the police or fire department.

A quality alarm system will provide two-way communication between you and the company and will combine audible and silent alarms triggered by sensors placed throughout the home—not just on windows and doors. Modern systems may also send an alert if smoke, carbon monoxide, or water is detected.

A major benefit of a monitored alarm system is that it may afford you a discount on your homeowners insurance—anywhere between 5 and 25 percent of your premium, depending on the system. The discount offsets a fraction of the cost of the system. For example, if your homeowner’s insurance discount is a modest 10 percent of $650, the average annual cost of insurance, you’ll save $65 each year. However the average annual monitoring cost is $360, meaning you’ll spend $295 more than you’ll save on insurance.

On the other hand, the FBI reports that the average dollar loss per burglary is $2,185. Assuming average installation and monitoring costs, if your monitoring system thwarts a burglary, it just paid for itself for 4½ years.

Keep in mind the alarm company likely has a limited liability if you’re burglarized, even if it’s through the company’s negligence or an equipment failure. They won’t reimburse you beyond a specific amount, included in the contract. The contract may also limit your right to sue for additional money.

Potential Costs

  • Equipment installation costs can vary anywhere between $100 to well over $1,000, depending on the size of your house. It would not be unusual to pay $1 to $2 per square foot of your home. You’ll have to cover that cost up front. However, some systems offer a free self-install alternative.
  • Monthly monitoring will run you anywhere between $15 and $100, with the average being around $30. You may be required to sign a long-term contract.
  • An early termination clause could leave you liable for a significant portion of the contracted amount—even if you terminate the contract because you’re moving.
  • Some law enforcement offices charge a fee for responding to a false alarm. I found fees ranging from $50 to $100 for the first few false alarms and increasing with subsequent alarms. Ask the alarm company about their false alarm frequency and policies.
  • Some cities or counties charge an annual registration/permit fee. If you don’t pay the fee, usually $25 to $50, emergency personnel may not show up if the alarm is triggered.

Self-Monitored System

By comparison, the cost savings of using a self-monitored system makes it pretty appealing. You’ll buy and install all the cameras and sensors, which could be pricy, but it’s a one-time expense and you’ll save by not having an ongoing monthly monitoring payment.

A self-monitored system begins with a camera that will capture video. You’ll receive a notification, like a text, when the camera is triggered by motion or an abrupt change in light, for example. You’ll be responsible for checking the camera from your smart phone and taking any necessary action, like contacting authorities.

Systems can be very basic—a single camera with two-way communication—or multifaceted enough to rival a monitored system. Complex set-ups could include sensors for fire and flood, options to automate small appliances and lights, keychain remotes, and sirens.

Potential Costs

  • A single basic camera starts at $200. That might be enough if you live somewhere with a single point of entry. Popular systems by Piper and iSmartAlarm offer bundles starting at $350-$400 that include additional equipment, like door/window sensors.
  • You may be able to enhance your system with a variety of add-ons. For example, a switch that will allow you to turn on a lamp from your phone will cost you $40-45.
  • In general, cameras plug into an outlet (some include a back-up battery). If you want to add an outlet, it will cost you a couple of hundred dollars.
  • Depending on your system, there may be a cost for storing video. Some systems include free cloud storage plans that save video for a few days. If you want it kept longer, you’ll pay an annual fee.

Basic Home Improvements

A problem with either type of monitoring system is they can be vulnerable to hackers or thieves. A cost-effective alternative may be to make your home less appealing to intruders. Consider these basic improvements:

  • Install motion-activated lighting. You can replace an existing outdoor light with a motion-activated fixture for less than $50.
  • Make sure windows and doors are always locked. External doors should have a grade 1 or grade 2 dead-bolt lock that penetrates the door frame and a heavy-duty strike plate. You can buy a single dead-bolt for around $30. You can also find window-break alarms or aftermarket locks for as little as $5 each.
  • Install timers to turn lights on and off, making your house look occupied. A simple timer will cost less than $10.
  • Trim shrubbery so it does not provide an easy hiding spot for intruders.

These home improvements, just like any other system are not infallible. Choosing a security method is a matter of balancing your peace of mind with money out of pocket. Or, I’d be happy to let your borrow Fluffy and Fifi. And some ear plugs.


This post was written by Lisa Fedak, Creative Services Manager at Colorado PERA. If you’d like to submit a guest post, please email us at