Paying to much for your Android or iPhone? Here’s how to save hundreds of dollars on your new phone. It’s actually very easy.
Don’t buy a subsidized with a two-year contract with AT&T or Verizon or Sprint or T-Mobile. Instead, buy a completely “unlocked” phone and go find a cellular provider on your own.
When buying a phone with a contract it creates the illusion that you’re saving and you are not.
Lets do the math. Examples below…
A 16 gigabyte iPhone 6 with a two-year contract costs $199 at the Apple store.
A monthly contract with unlimited voice and texting and 1 GB of data costs $65 to $80 a month, depending on the network, according to Apple’s store. Getting 2 GB a month will cost $80 a month or more.
Total cost over two years: at least $1,759 (assuming a low-priced one-gig data plan, and not counting taxes, activation fees and so forth).
Now try it the other way.
Get a 16 GB iPhone 6 unlocked from the Apple store for $649. Then sign up for monthly service from a bargain network like Cricket or H20 or GoSmart.
Price for unlimited voice and text and 1 GB of data a month: $35.
Cost over two years: $1489, or nearly $300 less.
The savings actually get bigger as you use more data. Power users who want multiple gigabytes of data per month will pay $100 or more on the brand-name networks, but around half that on less expensive networks.
For example, 3 gigabytes a month on Verizon Wireless is $100 a month. With Cricket, it’s $45.
When you add it all up you may save $700 or more over two years.
Lest you worry that these bargain networks somehow aren’t as good, they typically sell airtime on the same network. Cricket is actually a division of AT&T and uses the same network.
Bargain networks exist so that major networks can sell off their spare capacity cheaply without undercutting their own brand. (They know that most people will pay extra for a comforting brand.)
There are potentially other savings as well. If your iPhone is on a contract, when you travel abroad you’ll typically have to pay hefty roaming fees to use it. If your iPhone is unlocked, you can just pick up a local SIM card and pay next to nothing.
And if you’re not on a contract you are free to move to another, even cheaper plan at any time. The price deflation in cellular contracts is a wonder to behold. Every month someone comes out with something cheaper. Pity the poor suckers locked into a two-year deal. Mwah-hah-hah-haaaaah!
The other way to save money on a new iPhone is to wait for the latest model to come out and then buy last year’s model cheaper. Comedian Bill Maher once called the price premium for brand-new technology “the nerd tax,” and he’s half right. Actually, it’s the fashionista tax. “Oh, I want the latest iPhone. It absolutely must be the latest model, whatever that is” said one flibbertigibbet, with a voice like Lady Mary from Downton Abbey, when I was in a Carphone Warehouse cellular store in London last year. Oh dear. Presumably Mummy and Papa are paying.
Not only are last year’s iPhones cheaper than this year’s model, but they are available on a wider array of bargain networks as well.
Consider: An iPhone 5 costs $399 through FreedomPop, a network which resells Sprint network airtime. And the monthly cost runs as little as… er… free. Yes, really. Two hundred voice minutes, 500 text messages and 500 megabytes of high-speed, 4G data will cost you nothing at all. Trade up to unlimited voice, texts and data (with 1 gigabyte at 4G speeds) and you’re still only paying $20 a month. That’s less than $500 over two years in network fees, compared to $1,500 or so through a major network.
Do the math.
Via MSN Money
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