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Monday, July 15, 2013

Contract Vs. Pay As You Go Mobiles- Which Is Better?

Getting a new mobile is pretty exciting, but once you've got one, you're going to need service. Navigating the world of mobile service operators can be tricky. There are plenty of operators to choose from, and each has their own set of plans and tariffs. Today we're talking about how you get service to your mobile, what your options are and which might be the best deal for you. So, if you're looking for a mobile operator, keep reading to find out the best way for you to get service.

What Are Your Options?

As confusing as mobile service plans might seem, there are actually only three ways to get service on your new phone. There are two different kinds of contract, either incentive contracts or SIM only contracts, or you can get a pay as you go plan. Whilst different operators will have different tariffs and special offers on each of these kinds of plan, these are you're only three basic options. When you're shopping around for a new plan you're going to want to be clear on which of these options you want, since it will make the process of comparison shopping much easier.

SIM Only Contracts...

The first option is to sign a SIM only contract. This contract will mean that you agree to be a customer of the operator for a certain amount of time, generally one or two years. In return, the operator will provide you with service for a fixed monthly fee. When you sign a SIM only contract you'll be asked to choose a calling plan, and different operators have different plans and charges. A calling plan will give you a monthly allotment of calling minutes, text messages and mobile data that you can use for your monthly price. It's important that you choose the right calling plan. You will pay the same monthly price whether you use all one hundred of your included calling minutes, for example, or whether you use ten of those minutes. That means that a calling plan that's too big will result in you paying for services that you never use. However, if you exceed the limits on your monthly plan you'll have to pay some pricey extra fees for any extra services that you use, so a plan that's too small isn't a great idea either. SIM only contracts tend to be the cheapest way to get service to your phone, as long as you choose the right calling plan. You will need to have a phone, or be prepared to buy a phone to use though. You must also be prepared to stay with the operator for the length of your contract, and not switch companies to get a better deal elsewhere.
Incentive Contracts...

An incentive contract is very similar to a SIM only contract, in that you will also sign up for a set period of time and have to choose a calling plan. However, an incentive contract will also give you a free or low cost mobile phone. This phone will not actually be free, since you'll be paying for it in your monthly bills. If you subtract the monthly cost of a SIM only contract from the monthly cost of the incentive contract with the same calling plan you'll be able to see how much more you're paying per month to get the phone. And if you multiply this amount by the number of months in the contract you'll get the total amount of money that the phone will cost you. If you compare the cost of the phone under contract to the actual retail price of the phone you'll find that you're paying a little more with your mobile contract. This is normal, and you're paying a little extra for the convenience of buying your phone in instalments and not having to spend a lot of money all at the same time. However, if you're in to long term saving it will be cheaper for you to sign a SIM only contract and buy the phone yourself. For many people this isn't an option though. Phones nowadays are so expensive that it can be tough to find that kind of money. An incentive contract will give you the phone you need without you having to find five hundred pounds immediately.

Pay As You Go Phones...

Finally, you can also choose a pay as you go plan. With pay as you go phones you go to an operator and buy a SIM card which you load with credit. The card goes in your phone and you use your mobile as normal until the credit runs out. When the credit is gone, your phone stops working (though you'll still be able to receive calls and messages), and you'll need to top up the credit again. There are both advantages and disadvantages to this. Pay as you go rates tend to be higher than rates under contracts, so if you're a big phone user this is a good alternative. However, for light phone users who don't come close to using up the limits in monthly calling plans, pay as you go phones can represent big savings. Your phone loses service when your credit runs out, which means you're going to need to be organised and check the credit level of your phone or risk not being able to make that important phone call because you have no credit. 

But pay as you go plans are not contracts, you sign nothing. You are free to leave the operator whenever you like, maybe because you find better prices somewhere else, so there's a lot of flexibility. Also, if you're unable to sign a contract, because you fail credit checks, you're not eighteen, or you're not a legal resident of the UK, pay as you go plans will be your only option. Finally, if you're trying to save money, then pay as you go mobiles do allow you to control your spending much more easily, since you only pay for what you use and there are no surprising monthly bills.

Sam Jones needed to find out more about pay as you go phones.  He simply used his extensive knowledge of comparison sites such as uSwitch and found all the information that he needed.

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