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Save money on your phone!

Method of purchase?

  • 2 year contract

  • Commitment free

  • NEXT plan

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VivaLaFisica

macrumors regular
Original poster
Sep 17, 2012
139
1
I don't understand how these options exist and people deliberately put themselves in a situation to shell out more money. Please explain.

2 year contract:
Out of pocket subsidized price: $300
2GB plan with rollover data: 30/month
2GB plan for iPhone on LTE: 40/month
Mobile share value plan data discount: -4.50/month
Monthly: 65.50 (+ around $6 in tax)
Total spent over 24 months $1,872

Out of contract:
Out of pocket full price:
$750
Now you've got an expensive iPod?
Add whatever monthly data and cell service.
Total spent over 24 months > total with two year contract

Next 30:
Out of pocket cost:
$0
Financing of device is the FULL price divided into monthly installments.
Phone: 25/month
2GB data: 30/month
2GB LTE: 40/month
data discount: -4.50/month
mobile share plan value savings: -15/month
Monthly: 75.50 (plus tax)
Total spent over 24 months: $1,812
Upgrading after 24 months forces you into another NEXT plan, but it's not over until your 30th installment.
Total paid after 30 months: $2,265

Versus at the end of a two year contract, for any time after the 24th month, the discount of $15 applies per month. It was time to upgrade now (yay), but I kept my iPhone 5 for 37+ months, working well and saved way more money.

Is there something I am not seeing? To me, it's obvious to just stick with a two year contract and pay less money on the long run. Is the only incentive of a NEXT plan that some people can't shell out the subsidized cost immediately? For what reason would you buy a phone (iPod) commitment free?
 
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I'm completely lost with the new Verizon monthly payment plans. I just paid my $399 and another 2 year contract. Will figure out something after that time.
 
I'm on the grandfathered unlimited plan, so I don't get a discount whether or not I use my subsidy.

I did purchase commitment free this time since my line is still under contract, but I can sell my existing 6 plus 128GB (which is unlocked) to make up for a decent bit of the cost
 
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If you are on a grandfathered plan then that is most likely cheaper than the newer mobile share value plans. As a new AT&T customer two years ago the contract plans were more expensive so I switched to the mobile share value plan and received a monthly line discount. You'd buy a phone commitment free mostly because you're on a prepaid carrier, or you like the freedom of having an unlocked device, or you hate making the monthly NEXT/EDGE payments, or you just have the money to spend and don't care.
 
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It's quite easy to save money on an iPhone. But you can't have your cake and eat it too.

To get one of the first on launch day you have limited full price choices. Full price being defined as whatever they are charging no matter which method you choose.

For those who aren't controlled by Apples timeline, just wait a few weeks till the madness cools and you'll find some deals if you look.

I'd bet it's going to be better this year than ever. Having watched each new iPhone launch since the original I get a sense that the iPhones popularity is fading. It's not collapsing and won't, but demand and buzz around the iPhone 6S has been weak this year.
 
VivaLaFisica said:
Is there something I am not seeing? To me, it's obvious to just stick with a two year contract and pay less money on the long run. Is the only incentive of a NEXT plan that some people can't shell out the subsidized cost immediately? For what reason would you buy a phone (iPod) commitment free?
Click to expand...
Well, one reason for buying commitment free is you remain free of commitments. ;) You can switch or cancel at any time without paying an early-termination fee. You also get an unlocked phone which can save a lot of money when traveling internationally. You may also save some money on activation fees when getting a new phone (on contract it's $45, on Next it's $15, for a fully paid phone it should be $0).

What it comes down to is that the $15 discount that AT&T gives to no-contract customers on the smaller plans doesn't fully make up for the device subsidy that you would otherwise receive on contract. But if you have one of the bigger plans, the discount is $25, which almost evens out the difference while still having the above mentioned benefits of not being locked into a contract.
 
VivaLaFisica said:
I don't understand how these options exist and people deliberately put themselves in a situation to shell out more money. Please explain.

2 year contract:
Out of pocket subsidized price: $300
2GB plan with rollover data: 30/month
2GB plan for iPhone on LTE: 40/month
Mobile share value plan data discount: -4.50/month
Monthly: 65.50 (+ around $6 in tax)
Total spent over 24 months $1,872

Out of contract:
Out of pocket full price:
$750
Now you've got an expensive iPod?
Add whatever monthly data and cell service.
Total spent over 24 months > total with two year contract

Next 30:
Out of pocket cost:
$0
Financing of device is the FULL price divided into monthly installments.
Phone: 25/month
2GB data: 30/month
2GB LTE: 40/month
data discount: -4.50/month
mobile share plan value savings: -15/month
Monthly: 75.50 (plus tax)
Total spent over 24 months: $1,812
Upgrading after 24 months forces you into another NEXT plan, but it's not over until your 30th installment.
Total paid after 30 months: $2,265

Versus at the end of a two year contract, for any time after the 24th month, the discount of $15 applies per month. It was time to upgrade now (yay), but I kept my iPhone 5 for 37+ months, working well and saved way more money.

Is there something I am not seeing? To me, it's obvious to just stick with a two year contract and pay less money on the long run. Is the only incentive of a NEXT plan that some people can't shell out the subsidized cost immediately? For what reason would you buy a phone (iPod) commitment free?
Click to expand...

Most people are stupid when it comes to managing money but think otherwise. Or doing taxes. And yes, paying for smartphones.

http://www.aicpa.org/Press/PressReleases/2015/Pages/New-AICPA-Survey-Finds-Disconnect.aspx
 
Paying full price and being commitment free saves my wife and me money. We don't need unlimited minutes or texting or a lot of data. We're on WiFi often, so we use Selectel, a Verizon MVNO, and pay $30 each per month. If we needed more data, we would use Straight Talk and pay $45 plus sales tax for unlimited voice, texts, and 5GB per month. We have the freedom to do that by not being on a contract and having subsidized phones.
 
As Rigby has mentioned, it depends on the size of the data bucket (ergo, line discount) and the number of lines on your plan.

We're on family plan with 20GB (double data promo), 4 iPhones and 1 iPad so Next/off-contract is cheaper for us ($100 + $15*4 + $10 = $170 or just $40/smartphone line). If not for tethering and iPad though, I'll probably switch to Cricket or Total Wireless.

If I were an individual line user, I wouldn't even bother with postpaid. Cricket 2.5GB is $35/mo with auto-pay so total for 2 years including cost of device ($750) is $1,590.
 
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VivaLaFisica said:
I don't understand how these options exist and people deliberately put themselves in a situation to shell out more money. Please explain.

2 year contract:
Out of pocket subsidized price: $300
2GB plan with rollover data: 30/month
2GB plan for iPhone on LTE: 40/month
Mobile share value plan data discount: -4.50/month
Monthly: 65.50 (+ around $6 in tax)
Total spent over 24 months $1,872

Out of contract:
Out of pocket full price:
$750
Now you've got an expensive iPod?
Add whatever monthly data and cell service.
Total spent over 24 months > total with two year contract

Next 30:
Out of pocket cost:
$0
Financing of device is the FULL price divided into monthly installments.
Phone: 25/month
2GB data: 30/month
2GB LTE: 40/month
data discount: -4.50/month
mobile share plan value savings: -15/month
Monthly: 75.50 (plus tax)
Total spent over 24 months: $1,812
Upgrading after 24 months forces you into another NEXT plan, but it's not over until your 30th installment.
Total paid after 30 months: $2,265

Versus at the end of a two year contract, for any time after the 24th month, the discount of $15 applies per month. It was time to upgrade now (yay), but I kept my iPhone 5 for 37+ months, working well and saved way more money.

Is there something I am not seeing? To me, it's obvious to just stick with a two year contract and pay less money on the long run. Is the only incentive of a NEXT plan that some people can't shell out the subsidized cost immediately? For what reason would you buy a phone (iPod) commitment free?
Click to expand...

Buying an unlocked phone in full gives you the ability to use AT&T prepaid or an MVNO to save money on the monthly data/cell service, while likely getting more data in the process. It's also better for traveling, as you can use a local carrier's SIM rather than pay for AT&T's absurdly high international plan for a month (minimum timeframe, not pro-rated).

A 2 year contract vs Next 24, yeah in that case it's really about the upfront cost. I don't think for most people the ability to pay off the phone early and get it unlocked is really the primary motivation.
 
I'm on T-Mobile and took advantage of their family promo and iPhone promo so I'm paying $50/mo for unlimited talk/text and 10GBs of data with Data Stash, and Music Freedom (streaming music services don't count toward data limits), and $19/mo for my 6+ and soon-to-be 6S+. That's $1656 over 24 months, but it may change for better or worse in 12 months depending on the cost of the 7 or if they offer even more aggressive family pricing.
 
VivaLaFisica said:
Is there something I am not seeing? To me, it's obvious to just stick with a two year contract and pay less money on the long run. Is the only incentive of a NEXT plan that some people can't shell out the subsidized cost immediately? For what reason would you buy a phone (iPod) commitment free?
Click to expand...

Ya, I think there is something you aren't seeing. You're not seeing that not everyone is in the same situation as you are. If you only have a single line and don't use much data, then the subsidy is probably fine. But for me, I bailed on my unlimited data plan when Next came out. I ended up with a larger data bucket than I ever used with unlimited and the cost of each of my lines dropped by $25/mo ($15/mo instead of $40). And on top of that, I now have all the tethering I want and I don't have to jailbreak my phone to get it. Next is basically 0% financing and that is NEVER a bad deal.
 
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I've decided to buy my iPhone 6s outright and join t-mobiles $30 plan which is 100 minutes, unlimited texting, and 5GB of 4G data a month. I honestly don't talk that much, and if it comes to that, I could use FaceTime Audio as everyone I know has an iPhone anyway. And I can always go back to Ting where my bill has always been $19-20 a month.

So those are two good reasons right there.
 
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