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REDDITHow should you buy your next smartphone? Is entering into a payment plan the way to go, or should you pay for it all in one go and own it outright? Lots of factors enter into this decision, including your financial situation and how often you want the latest smartphone model.
Yes: Own It Before It Goes Obsolete
Most smartphone payment plans extend for 18 or 24 months, but new phone models come out every year. Many people love having the latest technology and hate paying for things only to have them go obsolete. While smartphone models certainly last for more than two years, newer versions will have come out by the time you’ve paid off your phone. Plus, payment plans add to your phone bill, so you have to factor that expense in as well.
At that point, if you want to sell your current smartphone, it’s already a year or more out of date. Buying phones as soon as they come out, however, gives you the freedom to upgrade whenever you want. Get the latest model as soon as it hits shelves, and sell your old phone for top used dollar on sites like Gazelle or through your carrier.
No: Avoid a Large Upfront Expense
Payment plans, phone leases, and subsidies are popular options for purchasing smartphones because many people can’t afford to pay hundreds of dollars at once. Saving up for a smartphone isn’t always feasible given your other expenses. Sometimes, your current phone breaks and you don’t have time to save for a new one. Monthly payment options give people on lots of different budgets access to the best smartphones.
For example, when you lease the iPhone 6S Plus through T-Mobile, the Uncarrier has you put some money down, then make low monthly payments over 24 months. Monthly payments are handy for those still learning to budget and for those who can’t afford big expenses. After the 24-month period is over, you own the phone, and your phone bill goes down a little bit since you’re no longer making payments.
Yes: More Freedom to Move Carriers
If you lease your phone from your carrier, or you enter into a phone payment plan, you’re committed to that carrier for a period of time. Payment agreements aren’t the same as contracts, so you don’t get penalized in the same way for wanting to leave. But you do have to decide if you want to buy the leased phone upfront or return it and find a new phone option with another carrier.
You might have to pay a few extra lease payments to end your contract. Plus, the phone has to be in acceptable condition when you return it.
No: Get New Models More Frequently
Many carriers offer leasing and financing plans that let you upgrade more frequently than every two years. If you love to have the newest phone model, dropping hundreds of dollars every year on a new one isn’t the most financially feasible option. Instead, turning to leasing and financing plans with the right stipulations allows you to pay for the phone while you use it, then upgrade with the same carrier when a shiny new model comes out.
When you sign up for these plans, you don’t have to worry about those two-year contracts anymore. Carriers have realized that consumers aren’t fans of being locked in for so long, so they’ve shifted the model to suit customer needs. Make sure early upgrades are in your lease agreement or your equipment plan if you want to have the newest model every year. You also don’t have to be made of money to take advantage of the latest smartphone models.
Deciding whether or not to buy your next smartphone outright revolves around your circumstances and your current budget. All options, including payment plans, buying outright, and leasing, are valid choices. The best way to decide is to sit down with your finances and figure out what works best with your life.
