Thursday, July 5, 2012

Money Saving 101: No Contract Cell Phones

Today's author is: Derron.


Whenever someone talks to me about cell phones, the one thing I hear more often than not in my line of work is the cost of the bill every month.  It ranges from “I can’t afford it” to “If my kids would stop downloading all that music” and on and on.  In this grand information/technology era, constant communication among family members really is important to a lot of people, and I’m one of them, especially with my daughter.  When she was 9, she asked for her first cell phone and I had to think long and hard if getting her one was a good move.  That being said, my daughter has had a cell phone for the last 2 years, so I gave in but not without a little research.   After doing some shopping around, I settled on a no contract cell phone for her and it has been the best decision I’ve made when it comes to cell phones. 
 
No contract phones are just what they sound like: a cell phone without a contract.  Also included: no credit check, no down payment and no reason not to like it.  Almost every carrier is now offering some sort of no contract phones.  As it was at one time only Cricket or some smaller carriers, now AT&T, Verizon and others are offering cell phones without a contract.  After (maybe) a higher initial fee for purchasing the phone, there are a lot of positives to like about these phones compared to phones where you have to “sign up” for 2 years, or longer.  When you are in a contract, if you do not pay the bill, the phone is shut off.  When you re-connect, there is a fee.  There are also late fees, charges for downloads and other charges when you look at your bill.  When a no contract phone is shut off, there are no extra fees attached to getting it turned back on.  All you must do it purchase a refill card and add it to your account.  Guess what else…no fees for a re-connect. 

 If money is tight and her phone is off, my daughter has to wait to get the money to turn her phone back on.  Another good thing about this phone is that if you don’t refill the account and the phone is off, there is no lingering bill out there making its way to the collection agency.  You can also download to a no contract phone, but guess what…if there is no money in the account, it will not let you download anything. For me, it is a great teaching tool.  If my daughter wants a ringtone, she saves her money and then will purchase a Verizon card and download what she wants.  There are not any of the unexpected $340 cell phone bills that we have all been surprised with.  She saves her money and buys what she wants.  A quick plan comparison is that my daughter pays only $50 for unlimited talk and text, where I pay $30 for the family plan and $29.99 for the data package; she’s getting the better deal I think.   

Some other comparisons are:

                                    Contract                                             No Contract  

Talk & text                        yes                                                           yes

Picture messaging              yes                                                           yes

Downloads                       yes                                                           yes

2 yr. contract                    yes                                                            no

Re-connect fees                yes                                                           no

Web browsing                   yes                                                          yes


Those are just some of the quick comparisons to keep in mind when you are cell phone shopping for yourself or a family member.  Good luck!!

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