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Contract or pay as you go mobile phones
Contract Mobile Phones Or Pay As You Go Mobile Phones?

Prepaid mobile phone plans or pay as you go mobile phones? When you choose a mobile phone, it's not just the type of handset and the features you need to worry about. A more important question is how you are going to pay for the calls you make. There are two choices: getting contract mobile phones or pay as you go mobile phones. Here's a guide to the advantages and disadvantages of each type of mobile phone plan.

The Ins and Outs of Contract Mobile Phones

Once upon a time, all you could get were contract mobile phones. These were phones where you had to sign up for a monthly contract with pay monthly plans. These contract mobile phones are still around today, and one of the reasons that they are still popular is that once you have arranged the deal, you don't need to think about it again. With contract mobile phones, you get a bill for the service and you also pay for the calls, and you usually have to sign a contract of at least a year, though some may be longer.

So what's the advantage of contract mobile phones? One benefit of contract mobile phones is that you often pay less for the calls you make. In general, the rate you pay tends to be lower than that charged by the same provider for pay as you go phones. This is one of the ways in which mobile phone providers sweeten the deal for contract mobile phone customers. Another is in making some handsets only available to pay monthly customers.

In addition, because you pay a monthly fee, you usually get an allowance of call time included. This may be made up of a combination of text messages and calls or, if you are on a 3G service, video messages. This means that some people may get away with just paying the monthly fee. Contract mobile phones can be cost effective and you never have to worry about running out of airtime. However, one possible disadvantage with contract mobile phones is that you are tied to that provider for a whole year minimum, so if you find a handset or deal that you prefer, you could be stuck for several months before you can change.

The Pros and Cons of Prepaid Plans

If you prefer more flexibility, then prepaid mobile phone plans or pay as you gomobile phones are your best bet. As the name suggests, there is no monthly contract. Instead, you top up your prepaid mobile phone plan with a card (preferably before you run out of airtime). This leaves you free to spend as much or as little as you like on mobile phone calls and you are not tied to any plan, giving you the flexibility to switch providers if you find a better deal. With many mobile phone providers letting you keep your number, this prepaid mobile phone plan option may be even more appealing.

Pay as you go mobile phones appeals to some because you don't need credit checks before you can get a phone. However, you may find that you pay more for a phone handset. With contract mobile phones, the cost of the handset is usually subsidised as part of the incentive for taking the deal. With pay as you go mobile phones, there's no need for that incentive and handset costs are correspondingly higher. Calls may be more expensive with some pay as you go services, and there is no monthly allowance of call time and text time. In spite of this, pay as you go mobile phones provide a way to stay in control of mobile phone spending, and that's why it's so popular.

So, when evaluating which type of mobile phone plan—contract mobile phone plans or pay as you go mobile phones—is best suited to your needs, remember that—

With contract mobile phones you:

  • have a wide choice of handsets

  • may pay less for calls

  • get a call time package

  • don't have to worry about topping up

With prepaid mobile phone plans or pay as you go mobiles you:

  • have maximum flexibility

  • may pay more for calls

  • control your spending on calls

Compare mobile service providers

 
 
 
 
 
 
 
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