SE: NEXT installment or buy outright?

[Rigby]

I've noticed something else - AT&T charges a $15 "upgrade fee" with Next, yet if I buy the phone at full price from them or full-price SIM-free from Apple (moving my SIM over), they won't.

According to AT&T's web site, they will charge a $15 "activation fee" even if you buy your own phone:

https://www.att.com/shop/wireless/byop.html

However, it seems they are waiving this until 3/31, which, incidentally, is exactly the date the SE comes out. So for the early buyers, it's probably a good idea to activate the phone right away ...

 

[Retired Cat]

I buy my devices unlocked and pay in full.

It's less complicated that way, and there's no hassle dealing with getting the phone unlocked later.

 

[ecschwarz]

According to AT&T's web site, they will charge a $15 "activation fee" even if you buy your own phone:

https://www.att.com/shop/wireless/byop.html

However, it seems they are waiving this until 3/31, which, incidentally, is exactly the date the SE comes out. So for the early buyers, it's probably a good idea to activate the phone right away ...

Yeah - they do that for new lines, which makes a little sense. It seems there's two different $15 fees at play: one is for getting phones on Next as an "upgrade" fee and one is for activating a new line (typically waived online). Fortunately, they don't double-dip, so someone who is new and getting a Next phone will only be charged the activation fee.

What I was talking about was the first one - this would be if I was replacing my current phone on an already active line. In other words, if I did Next, they charge a $15 "upgrade" fee, but if I paid full, they wouldn't (according to their shopping cart), and if I bought it from Apple SIM-free, I'd just move my SIM over, avoiding any fee there, too. I did some more digging and it was a new invention from the last time I did Next:

http://www.theverge.com/2015/7/21/9011255/att-raising-activation-fees-august-1

 

[Rigby]

Yeah - they do that for new lines, which makes a little sense. This would be if I was replacing my current phone on an already active line. In other words, if I did Next, they charge a $15 "upgrade" fee, but if I paid full, they wouldn't (according to their shopping cart)

Good to know! I pre-ordered the AT&T version and am paying in full. Would be kind of a joke if they were to charge a fee for that but not for people who buy the SIM-free version and just swap their old SIM to the new phone ...

I did some more digging and it was a new invention from the last time I did Next:

http://www.theverge.com/2015/7/21/9011255/att-raising-activation-fees-august-1

When it comes to inventing new fees, they are incredibly creative.

 

[Quicklite]

Didn't really fit into my upgrade cycle so will have to get rid of my Galaxy once it arrives.

 

[Rigby]

I buy my devices unlocked and pay in full.

It's less complicated that way, and there's no hassle dealing with getting the phone unlocked later.

To be fair, paying off Next and getting the phone unlocked is super simple: You can pay off Next with a single button press on AT&T's web site, and requesting an unlock also takes just a minute using their web form. I did that when I pre-ordered my 6 in 2014 because there was no full-price option during the pre-order back then.

 

[Boyd01]

I got my 6s Plus on NEXT in December, really couldn't see any downside since it's a 0% loan you can pay in full at any time with no penalty.

Now some people may not have the discipline to budget and pay things off over time. If you're like that, then of course you should buy it outright up front.

 

[ecschwarz]

Good to know! I pre-ordered the AT&T version and am paying in full. Would be kind of a joke if they were to charge a fee for that but not for people who buy the SIM-free version and just swap their old SIM to the new phone ...
When it comes to inventing new fees, they are incredibly creative.

I got lazy and sent in a couple of old iPhones to Apple's trade-in program and am waiting for the verification/quotes/etc. to drop the cost if I were to buy from Apple. Because of this, I missed the first round of pre-orders and will probably visit an Apple Store on 3/31 and get the SIM-free model. I was weighing my options because there's a ton of AT&T Stores around and I can certainly use Apple Store gift cards for other things in the future. Even with the cash laying around, Next isn't a bad idea, but the fees are sort of silly (the principle, not really the amount vs. the much larger cost of a new phone).

Seeing that Best Buy is doing a promo where you get a $50 gift card with the purchase of an SE, that's also tempting. Unfortunately, it's available only on contracts or payment plans—that could help offset the Next upgrade fee on paper if you plan any other Best Buy purchases. I'd just hope they'd have some in stock relatively early.

 

[Phone Junky]

Yeah practically free AC+ if you do the math by end of 24 months

Please explain this. I don't follow.

 

[aneftp]

Why would you ever pay up front when you can get a free loan that comes with promotions? NEXT gets you deals and offers, pay upfront is for people with no credit or are too stupid to take advantage of free financing.

If there are no promo and people like me to like to use free Amex (or discover) accidental 90 day protection and extra year of warranty.

I don't like apple care or square trade for myself since I take care of my phones.

If you do att next and drop ur phone or damage it accidentally. AMEX WILL NOT honor 90 day accidental protection or extra year of warranty.

That is a warning for those doing att next or other financing plans.

 

[Mac 128]

I got my 6s Plus on NEXT in December, really couldn't see any downside since it's a 0% loan you can pay in full at any time with no penalty.

Now some people may not have the discipline to budget and pay things off over time. If you're like that, then of course you should buy it outright up front.

That is the only reason not to do the monthly installment.

 

[ecschwarz]

That's' really good to know - I tend to be careful, but thanks!

If there are no promo and people like me to like to use free Amex (or discover) accidental 90 day protection and extra year of warranty.

I don't like apple care or square trade for myself since I take care of my phones.

If you do att next and drop ur phone or damage it accidentally. AMEX WILL NOT honor 90 day accidental protection or extra year of warranty.

That is a warning for those doing att next or other financing plans.

 

[Mac 128]

That's' really good to know - I tend to be careful, but thanks!

I tend to be careful too. That didn't stop me from breaking two iPhones accidentally. But more importantly it doesn't stop mechanical defects from appearing.

When I updated my iPhone 5s with iOS 9.2.1, Touch ID broke, and the phone developed an abnormal battery drain. Took it to the Apple Store and they said 9.2.1 exposed some previous undetected defect. I was not able to purchase Apple Care + because I bought it from a friend who did buy it, and it can only be purchased within 60 days of the original purchase. So Apple offered to repair it for $269.

Now, if I had purchased that phone with an AMEX or Discover card, I would have still been screwed because it was 3 months past the 2 year purchase date.

Also, I will not pay a fee to any credit card company to use their card. There are too many other options that blow AMEX out of the water. And you still have to pay the entire amount up front, or pay high interest rates -- and I'd rather put the money in the bank and earn interest on it while paying an interest-free, monthly payment. And I'm not sure if you've ever tried to get a credit card company to honor one of those warranties, but beware of the fine print.

When it comes to the iPhone, nothing beats AC +. If something goes wrong, everything is quickly and easily taken care of. Add to that the fact that Apple is selling 50-70+ Million iPhones a quarter. Quality control is good, but the odds go way up you will need extended coverage. Personally speaking, not counting accidental damage, I've had to replace every iPhone I've ever owned at least once under warranty, and a few twice. My current 5s was replaced after 11 months under Apple Care for a defective flash, and then a little over a year later the Touch ID/battery problem. Fortunately the SE came along in just the nick of time, so I don't have to pay to repair the 5s.

 

[C DM]

I tend to be careful too. That didn't stop me from breaking two iPhones accidentally. But more importantly it doesn't stop mechanical defects from appearing.

When I updated my iPhone 5s with iOS 9.2.1, Touch ID broke, and the phone developed an abnormal battery drain. Took it to the Apple Store and they said 9.2.1 exposed some previous undetected defect. I was not able to purchase Apple Care + because I bought it from a friend who did buy it, and it can only be purchased within 60 days of the original purchase. So Apple offered to repair it for $269.

Now, if I had purchased that phone with an AMEX or Discover card, I would have still been screwed because it was 3 months past the 2 year purchase date.

Also, I will not pay a fee to any credit card company to use their card. There are too many other options that blow AMEX out of the water. And you still have to pay the entire amount up front, or pay high interest rates -- and I'd rather put the money in the bank and earn interest on it while paying an interest-free, monthly payment. And I'm not sure if you've ever tried to get a credit card company to honor one of those warranties, but beware of the fine print.

When it comes to the iPhone, nothing beats AC +. If something goes wrong, everything is quickly and easily taken care of. Add to that the fact that Apple is selling 50-70+ Million iPhones a quarter. Quality control is good, but the odds go way up you will need extended coverage. Personally speaking, not counting accidental damage, I've had to replace every iPhone I've ever owned at least once under warranty, and a few twice. My current 5s was replaced after 11 months under Apple Care for a defective flash, and then a little over a year later the Touch ID/battery problem. Fortunately the SE came along in just the nick of time, so I don't have to pay to repair the 5s.

To be fair, plenty of AmEx options without yearly fees or anything like that. And based in various feedback they do a fairly good job standing by their agreements.

 

[Oridus]

It's a no interest loan that can be paid off in full at any time. I don't equate that with buying something you can't afford at all, but opinions will differ.

Once half of the MSRP is paid off you can trade in for something else. I find that, particularly in recent years with resale values dropping, you won't get much more in a private sale than you would just returning the phone, if your goal is to have the latest device at all times. You might net an extra $50 or something, but that also includes the risk of selling it locally and/or shipping; I have never had a problem doing this and accepted the risk was par for the course "back in the day", but it's undeniably there.

Your phone WILL remain locked to ATT while on the payment plan. Really the nly downside in my eyes. SHould you travel or need/want to try another carrier, you won't be able to get it unlocked until its been fully paid for.
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No fee so long as at least 50% of the original MSRP (price at time of signing) has been paid off when trading in.

The 50% MSRP comment is false. First, Next users can trade in their device for something else as long as they're paid through their upgrade month. For example, if someone is on Next 18 (24 month payoff, 18 month upgrade) and is at month 12, and wants to upgrade, they'll pay installments 13-18 AND trade in their phone at the time of the upgrade. Depending on the device, and Next program they're on, that's usually more than 50%.

Second, Next users are welcome to pay off their installment plan at any time with no penalty.

 

[lordofthereef]

The 50% MSRP comment is false. First, Next users can trade in their device for something else as long as they're paid through their upgrade month. For example, if someone is on Next 18 (24 month payoff, 18 month upgrade) and is at month 12, and wants to upgrade, they'll pay installments 13-18 AND trade in their phone at the time of the upgrade. Depending on the device, and Next program they're on, that's usually more than 50%.

Second, Next users are welcome to pay off their installment plan at any time with no penalty.

You're right. The next plan I was always on was right at 12 plan; it's paid off in 20 months so you're right at about 60%. On a base $650 device that's about $390. I think my point still stands in terms of selling the phone off; you're not likely to see much beyond $50 return selling privately versus trading in for a new device. I don't think most people are jumping on next 24 with the assumption they will be upgrading terribly soon; I feel most people use that option to finance a phone for two years, but I could've been more clear on that point.

I was also aware that you could buy it out at any time. I'm unsure there is a program where one can't do that, so I felt it redundant to mention. But you're right. The only time this works against you is if you're being given monthly bill credits through a promotion, such as the recent BOGO promotions they've been running.

The 50% msrp was comment was based in the shortest plan, and perhaps a bit of the fact that we are with TMO now and got the facts a bit muddled. Apologies for the confusion. And appreciate the corrections.

 

[Oridus]

You're right. The next plan I was always on was right at 12 plan; it's paid off in 20 months so you're right at about 60%. On a base $650 device that's about $390. I think my point still stands in terms of selling the phone off; you're not likely to see much beyond $50 return selling privately versus trading in for a new device. I don't think most people are jumping on next 24 with the assumption they will be upgrading terribly soon; I feel most people use that option to finance a phone for two years, but I could've been more clear on that point.

I was also aware that you could buy it out at any time. I'm unsure there is a program where one can't do that, so I felt it redundant to mention. But you're right. The only time this works against you is if you're being given monthly bill credits through a promotion, such as the recent BOGO promotions they've been running.

The 50% msrp was comment was based in the shortest plan, and perhaps a bit of the fact that we are with TMO now and got the facts a bit muddled. Apologies for the confusion. And appreciate the corrections.

Ah makes sense now that you've detailed your reasoning. I apologize, it just seemed as if you were quoting actual terms of it needing to be 50%, so I read that wrong. >_>

 

[aristobrat]

Also, I will not pay a fee to any credit card company to use their card. There are too many other options that blow AMEX out of the water.

Most AMEX cards don't charge a fee, FWIW.

And I'm not sure if you've ever tried to get a credit card company to honor one of those warranties, but beware of the fine print.

I know this is anecdotal, but over the past decade I've used AMEX's extended warranty a few times, all without any hassle. Two were for broken TiVos (power surge broke one, which technically their warranty doesn't cover) and one was for an iPad whose home button stopped working.

You file (and manage) your claims online. No problems with any of the ones I've done.

 

[Rigby]

Another option if you think you need protection for your phone: Get a Wells Fargo credit card and use it to pay your phone bill. Their cell phone protection covers up to $600 on damage and theft. They have cards without annual fee.

 

[lildimsum7]

Buy outright , always the best choice .

How irrational are you? 0% on installments vs lump sum is a no brainer! The present value of the installment is always going to be less than the amount of the lump sum. This is basic maths people...

 

[Mrbobb]

U can get a free loan only if you are credit worthy. Ever heard "they only loan money to people who have money?" If you have to install-pay a $500 dollars item, one wonders what's your FICO.

 

[tedson]

Seeing that Best Buy is doing a promo where you get a $50 gift card with the purchase of an SE, that's also tempting. Unfortunately, it's available only on contracts or payment plans—that could help offset the Next upgrade fee on paper if you plan any other Best Buy purchases. I'd just hope they'd have some in stock relatively early.

if you look at the price Best Buy charges on the site (iPhone SE 64GB) it comes out to $549 with down payment and 24 installment payments. Then they give you a $50 gift card. You can buy the same phone for $499 from apple. Talk about the old bait and switch.

 

[ecschwarz]

if you look at the price Best Buy charges on the site (iPhone SE 64GB) it comes out to $549 with down payment and 24 installment payments. Then they give you a $50 gift card. You can buy the same phone for $499 from apple. Talk about the old bait and switch.

Yeah - I noticed that for the outright purchase at least. I just checked for installments and it seems like they're charging the $499 price (unless I'm reading it wrong):

 

[aristobrat]

U can get a free loan only if you are credit worthy. Ever heard "they only loan money to people who have money?" If you have to install-pay a $500 dollars item, one wonders what's your FICO.

The old 2-year contracts everyone signed were essentially installment plans run by the carriers. My guess is that their credit requirements for Next, etc aren't likely to be too much higher than what it takes to open an account in the first place.

Apple's Yearly Upgrade program being the exception. A fair amount of complaints about their credit requirements posted here. Haven't seen many about AT&T's Next program.

 

[aneftp]

How irrational are you? 0% on installments vs lump sum is a no brainer! The present value of the installment is always going to be less than the amount of the lump sum. This is basic maths people...

It's no longer 0% (with att). Att charges the bogus $15 att next fee now. Say u make $360 in att next payments for 12 months with X phone u buy.

So factor in $15. Comes out to around 3-3.5% interest att is charging you.

Once the Feds raise the central bank rates. Att gonna to keep raising those bogus att next "activation fees" Don't be surprise if they jack it up to $40 in the next 2-3 years and still claim 0% interest.