When it comes to phone service, some people regret signing contracts with carriers and wish they had a prepaid plan. Others don’t like the limits in prepaid plans.
The fact is prepaid and contract cell phone services are intended for different groups of consumers, and there are pros and cons to both. Here they are:
Why sign a contract?
Good value. Generally speaking, contract cell phone services offer frequent users plenty of minutes and good services at an affordable cost. Per-minute charges in most prepaid plans are higher than contract charges. This is especially true if you use your phone a lot.
Phone equipment discounts. Users who sign contracts enjoy good discounts on phones. The longer the contract, the better the discounts. Not so with prepaid users. Phone equipment tends to cost more than the discounted phones that carriers offer to consumers who sign longer contracts.
Great for regular users. Contract cell phone services are ideal for those who use their phones about the same each month. For these customers, there are no surprises when the phone bill arrives. Professionals and other consistent cell phone users tend to like contract plans.
Convenience. If you sign a contract, you never run out of calling timebecause minutes on a contract phone automatically renew from month to month, so you don’t have to replenish them.
Good reception. Those who sign contracts with carriers are more likely to enjoy good reception. In parts of the country where prepaid cell phones are less common, some prepaid customers complain about poor connectivity.
Why go with a prepaid plan?
Save money. With prepaids, there is the potential to save a lot of money if you don’t use your phone a lot. Prepaids are great for folks who don’t use the number of minutes included in most cell phone contract plans.
No commitments. The vast majority of contract plans require a two-year commitment that costs hundreds of dollars to break. If you are not fond of contracts, you’ll like prepaids, and you’ll be able to switch phones more easily.
Pay as you go. Prepaids sometimes are compared to toll roads. If you use them, you have to pay. If you don’t, you don’t. Prepaid customer love the fairness that they see in prepaids. They’re not paying for what they’re not using.
Good for budgeting. With prepaids, you know what you’re paying. You’re not going to open a phone bill and get shocked. Prepaids also can help parents control their children’s cell phone use.
Prepaid or contract? It depends on how much you use your phone and what you value. Be smart and do your homework, weigh your own pros and cons based on money, coverage and service.
Photo Credit: k.steudel
