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Did you buy your iPhone outright, or pay monthly?
- Thread starter geoff5093
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I did the math for a 2-year contract vs installment/pay cash.We have been with the same carrier for over 10 years. I preferred the old plans where you would get a free or discounted phone by signing a 2 year contract. Now they want you to make installments for your phone for a 30 month period but they will discount your monthly phone plan to cover your monthly phone payments?????? Anyway, our car is paid for and we pay the balance on our credit cards each month, but making installment payments on our phone, which is reimbursed by the carrier, sounded like the better way to go since we don't plan on changing carriers anyway. It's all just a big mystery anymore.
We save more money with the new plans since you stop paying subsidy the longer you keep your phone. Also, monthly subsidy cost was $25/mo or $500/20 months or $600/24 months on top of the $200 or so upfront cost. The 2-year contract only works if you upgrade your phone every two years on the dot.
Canada....the one country that makes American telcoms look modern and cheap.
My current plan is $60/month for 5 gig data, 250 minutes talk. On a 2 year contract. And that's a fantastic bargain I get as a government employee. The regular price for that plan is over $90. But hey, if I get 2 for $120 at least it's a shared 10 gig data pool
Oh, the $15 was just line access fee. That's on top of a base rate of $100/20GB for the shared data pool. It was supposed to be just 10GB base but they had a double data promotion at one point. Given the new unlimited plans have higher base rate and per line access fees, I'm holding onto my current plan which serves us quite well.Canada....the one country that makes American telcoms look modern and cheap.
My current plan is $60/month for 5 gig data, 250 minutes talk. On a 2 year contract. And that's a fantastic bargain I get as a government employee. The regular price for that plan is over $90. But hey, if I get 2 for $120 at least it's a shared 10 gig data pool
Got 4 phones on the account so it averages to ~$40/phone for service. Device cost is on top although I got the iPhone 7 for practically just tax after the $650 iPhone 6 trade-in credit. No iPhone upgrade for me this year. Got no complaints with the 7 and I plan to receive every last cent of that trade-in credit.
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And, for those reasons, it makes sense to pay upfront.
BUT - for those that are convinced they are
** avoiding financing something
** avoiding paying some extra charges
** avoiding being tied to a carrier
** avoiding a lease
They are totally WRONG.
I bought mine outright. My money. My choice. (FICO > 820)
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Like I mentioned previously, Apple iPhone Upgrade Program requires mandatory AppleCare+ so that's an extra charge if you weren't planning on getting AC+ to begin with.
Valid point. But, if you do the same program with the carrier, you do not have to do that. And, of course, you can buy yourself out of it at anytime you want. Or do the upgrade at 12 months.
Yup. At 0% APR, financially, EIP via carrier and paying cash costs the same assuming you're sticking with the same carrier and plan. For those who upgrade every year, it also gives you an option with known trade-in value right from the get go.
Mind, for 1-2 users, postpaid plans are usually a bad deal so paying cash for your device means you can go prepaid right away.
Some people are being bashed for buying outright. You gotta keep in mind that not everyone even has the option to finance. Yes, financing you pay retail over 24 months. Swappa, I end up saving around $200 vs retail. Plus, I’m with Verizon prepaid. I have so much data to work with, it’s unlimited to me. I pay $47.... vs almost $90 with postpaid unlimited. Comes out to over $500 per year saved. Use some of that along with the sale of my current iPhone to buy my next iPhone.
Financing a phone is equivalent to the two year contract concept. If you want to switch carriers and can’t afford to pay off the balance, you’re stuck. Same with contracts... can’t afford the ETF? Sucks for you, bro.
Financing a phone is equivalent to the two year contract concept. If you want to switch carriers and can’t afford to pay off the balance, you’re stuck. Same with contracts... can’t afford the ETF? Sucks for you, bro.
I bought my iPhone 6s without a contract for the full price and installed the SIM of a MVNO contract. There is no minimal contract duration but the notice period is two months.
Usually in Switzerland it is cheaper to buy the phone without a contract and install a cheaper SIM only plan than buying it for 1 buck and you pay around 100 swiss francs per month for at least 24 months.
Usually in Switzerland it is cheaper to buy the phone without a contract and install a cheaper SIM only plan than buying it for 1 buck and you pay around 100 swiss francs per month for at least 24 months.
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My iPhone 7 is the first phone I have ever bought outright. I usually do the plan thing every carrier sells you on. I do like the feeling of not being tied down to a carrier. However If you love the service you get from your current carrier and know you won't switch, financing isn't a bad deal at all.
Since the max score is 850, the margin can't be that nice.
lol just let him dream
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You're not tied down if you do an installment through carrier as you are welcome to pay off the installment at any time.
How do you figure that? You do realize that if you trade your phone in at 12 months, you didn't pay the full $120 for AppleCare, right? I personally think it's smart to have.
Wasn't arguing with anyone. Just putting in my perspective that their paying cash for their car may not have been as bad a thing as they were thinking.
I know the max. I know how close I am to the max. But really, it's no big deal what it is in my situation. The point of my comment was stating having the two "consumer" loans on the phones didn't impair the score as others tried to say it will. It's all based on an income to debt (and potential debt) ratio.
And really, I realize that math-wise, paying cash is better. However, financing the car for low interest while keeping more liquid cash is a safety blanket. All psychological.
To be clear, is this what you're talking about? https://www.apple.com/shop/iphone/iphone-upgrade-program? I believe it's what the OP meant in the Poll and what I was commenting on in my reply to the Poll.
And really, I realize that math-wise, paying cash is better. However, financing the car for low interest while keeping more liquid cash is a safety blanket. All psychological.
Yup - definitely understand that. In some ways, you can save yourself doing that if you run in to a setback of some kind. Auto's can be big purchases similar to houses.
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Yeah, no kidding. What I quoted you saying was "Monthly from Apple is basically a tax for those who are bad at math" and that is what I was questioning. Apple's IUP is interest free. So how do you figure it's a "tax for those bad at math"???
FICO scores have nothing to do with income and ratio. Nothing. Zero.
Borrowing money often does look at ratios... but in most cases it does not matter much other than a mortgage.
FICO does not even know your income.
Sorry for the confusion. I was replying to the poll directly.
The question "Did you buy your iPhone outright, or pay monthly?" and answer "Monthly (Apple Upgrade Program)"
That's the plan I was calling a tax on those bad at math.
I agree. It's just a way to stretch out your cost. I just redid my plan based on usage through AT&T and reduced my monthly bill by about $35. Got my new iPhone SE for $13 a month. I think I'm ahead...and what a lot of people aren't seeing it's 0% interest.
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As a side note, I was able to go through the Apple website and they took care of the carrier agreement and I was able to go the next morning and pick up my phone. It had been a couple of years since I had been in one and I was disappointed as the store was more sterile than before, no name badges on employees and it just seemed like a Borg collective. The funniest thing is that while I was waiting for my phone, another associate actually came up to me and asked me if I was looking for watchbands. Couldn't tell if he was serious or not......
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Okay - so I stand corrected on how FICO is specifically calculated. Every time I've cared about it has been around new mortgage time where income does specifically play a factor. Perhaps it's due to total income not being an easy number to get whereas credit history is, could be why FICO doesn't state it's a consideration. There has to be a correlation, though, as income must exist and be higher than the cost to service loans to have an excellent score.
For sake of the discussion, I found the following is taken in to consideration for FICO:
For sake of the discussion, I found the following is taken in to consideration for FICO:
- Payment history (35% of the FICO score)
- Debt/amounts owed (30%)
- Age of credit history (15%)
- New credit/inquiries (10%)
- Mix of accounts/types of credit (10%)
- Employment information, including your salary, occupation, title, employer, date employed or employment history
- Where you live
- The interest rates on your credit accounts
- Child or family support obligations
- “Soft” inquiries (requests for your credit report), which include requests you make to see your own credit reports or scores
- Any information that has not been proven to be predictive of future credit performance
- Participation in a credit counseling program