There are two main ways of owning a mobile phone: buying the phone on a contract, or operating a phone on a ‘pay as you go’ basis. Both plans have their pros and cons, so before you rush out and buy a new mobile handset, it is worth sitting down and considering what you intend on using your phone for and how much you have to spend.
What are Contract Mobile Phones
When you buy a mobile phone on a contract, you typically sign up to a mobile provider for a minimum term, normally between eighteen months or two years, although two years seems to be the standard these days. The cost of the phone is built into the monthly tariff, so unless you want a very expensive phone on a fairly cheap tariff, you can expect to pay nothing extra for the phone. Monthly tariffs vary considerably, depending on how many free minutes, texts and data allowance you want.
What are Pay as You Go Mobile Phones
A pay as you go mobile phone is exactly what it says on the tin – you only pay for what you use, so depending on your usage, the cost of ownership may fluctuate up and down a lot. If you want to have a PAYG mobile, you will have to purchase the phone up front, so the initial cost is higher. Thereafter you only pay for top-ups on your account and you can move the SIM card to another phone if you wish.
What Are the Advantages of a Contract Mobile Phone?
Buying a phone on a contract means you can enjoy owning a new mobile phone on a regular basis since most phone providers allow customers to upgrade their phones towards the end of the contract (if they agree to renew the contract). A mobile contract allows you to own a top of the range smartphone without having to pay for it up front. It also allows you to take advantage of free minutes, text messages and data allowances.
Reasons to Choose a Contract Mobile Phone
- You use your phone a great deal
- You like to own the latest phone
- Someone else is paying for the contract
Things to Beware of When Choosing a Contract Mobile
One of the biggest issues with contract mobile phones is that an awful lot of people end up on the wrong contract, so before you are talked into paying £30 per month for hundreds of free minutes and unlimited text messages, think about whether you are likely to use your allowance. It is far better to start off on a lower tariff and move up if necessary than the reverse.
What Are the Advantages of Pay as You Go Mobiles?
PAYG mobiles are perfect for people who don’t use their mobile phones much. Since you are only paying for what you use, you won’t be paying over the odds for your phone.
Reasons to Choose a PAYG Mobile
- You hardly ever use your mobile phone
- You have a poor credit rating
- You don’t care if your phone is older than the Ark.
About the Author:
Danny managed with his old mobile phone for many years, but when it died, he decided it was time to invest in a new one. He asked his mates which phone they recommended and they told him to buy a Samsung Galaxy S2 because it would do everything he wanted. So now he is now the happy owner of a new mobile phone.