Try Something Different
18 months ago, both my wife and I were looking for new cell phones and plans. I think we were pretty typical cell phone users - she was on a 2yr device payment plan for a phone she had bought in-store and we were on a family plan.
Had we continued on that path, buying the latest phones with the basic unlimited plan we would have ended up paying about $180/month for 2 lines and 2 new phones (paid over 2yrs) - a total cost of $4,320 for 2 people for 2 years.
However, instead, we made some tweaks to our approach and have been able to save about 50% and pay ~$2,200 over 2yrs instead!
Here are some tips and tweaks that we decided to make to help save more than $1,000/yr! Disclaimer: this is not an exhaustive review/discussion of the topic covered below; merely my own personal experience!
1 - You might not need the best new phone!
The iPhone debuted 15 years ago in 2007 and has, since then, gone through more than a dozen upgrade cycles. As is typical with technology devices as they mature, newer generations of phones aren’t always worth the premium - so pay attention to what is better and assess whether you’re willing to pay the extra for that.
And if you decide you’re willing to live with 1 or 2 generations old technology, you could save hundreds of dollars. Here are some examples, at the time of writing:
iPhone 13 (the latest): $799
iPhone 12 (slower CPU, same screen): $600 for a ‘mint’ condition used model
iPhone SE3 (same CPU as iPhone 13, worse camera, smaller screen): $429
iPhone 11 (slower CPU, worse camera, no 5G): $400 for a ‘mint’ condition used model
2 - A lightly used phone can be just as good
As hinted in the previous tip, you can save money by purchasing a lightly used phone. My friends and I have consistently purchased lightly used devices on eBay.com as well as Swappa.com and had positive experiences each time.
If you choose this option, especially with Apple devices, we suggest paying strong attention to the battery health (ensuring it’s over 95%) as well as the pictures of the actual device you’re purchasing so that you’re aware of any nicks & scratches before you buy.
3 - Look at how much data you actually need
Spend some time to dig into how much data you’re really using. If you’re like me and spend most of your time at home or in the office where there is wifi access, you may find that you don’t need unlimited data plans. I have discovered that I only ever use 3-5GB/month.
If, after research, you discover that your teenagers are the biggest data users - good for you! You will have a fantastic parenting opportunity - because managing a data cap is a great opportunity to teach and give them a way to learn to budget and how to live within their means!
4 - Use an MVNO / Switch to prepaid
Cellular coverage and quality has dramatically improved over the last 15yrs, especially in places like the NY metro area. In more rural areas, you may well need to be with a specific carrier that has coverage, but for the majority of us that live and spend the majority of the time here in Hoboken, my experience has been that the carriers do not differ all that much.
Traditional cell phone providers in the US now consist of Verizon, AT&T and T-Mobile (which merged with Sprint in 2020).
MVNO stands for “Mobile Virtual Network Operator” and are providers that rent the use of the traditional carriers’ infrastructure to provide cell phone service. This is analogous to living in Hoboken and choosing to purchase electricity from a provider different to PSEG.
Examples of MVNO include Cricket, Boost, Metro by T-Mobile (formerly MetroPCS), Straight Talk, Mint etc..
It is often possible to make significant savings by switching to an MVNO. For the last 18 months, I have personally used a combination of Red Pocket and Mint Mobile and have been generally happy with their services.
My old plan: Verizon (not including monthly payment for device): $60/month
Tried: Red Pocket 22GB plan (using T-Mobile network): $40/month
Tried: Mint Mobile 10GB plan (using T-Mobile network): $20/month (prepaid 12months in advance)
If you don’t wish to make such a drastic change, you can often find savings by switching to the prepaid plans on your existing carrier. For example, a close family friend switched to an AT&T Prepaid Plan that includes 8GB/month for $300/yr; instead of paying $60+/month for an unlimited plan.
Some caveats / further notes on MVNOs:
International roaming does not typically work with MVNOs (I have been lucky when I’ve traveled abroad that my friends have had roaming!) When my wife, who had also switched to an MVNO, went to London for a week for work and needed cell coverage, she simply purchased a prepaid SIM when she landed and was online for a week for only $20.
MVNOs do not typically have friendly device unlock policies - even if you pay sticker price for a phone upfront! Unless there is a very compelling deal, I would suggest buying an unlocked phone from the manufacturer (Apple/Google/Samsung etc) rather than an MVNO.
Many cable providers have gone into the MVNO business, promising discounts on bundling TV/Cable/Internet/Home Phone. I looked at the Optimum deal and was tempted but in the end, even after the discount, it wasn’t as good a deal as the one I found (Mint) and signing on with them would have meant committing to the cable company and hindering my ability to negotiate my Internet bill (which will be a future GetFinHealthy challenge)!
5 - Do the math on trade-in offers
Phones, after a couple of years, tend not to be worth very much. For example, I discovered that Apple valued our 2yr old phone at $20; which had cost $700 when bought new.
Carrier trade-in offers can sometimes make a good deal during promotion season or when you’re willing to switch providers. Check the fine print and make sure that your old device qualifies for a good trade-in and make sure you actually want to buy the phone that’s on offer - as I mentioned before, don’t pay extra for a model that you don’t need just because it’s got an extra discount because you’d still pay more than you wanted!
Also trade-in offers tend to only come from the traditional cellular providers - so factor in the premium you would be paying when you do the math. After crunching the numbers, I almost always found that buying an unlocked device and using an MVNO was cheaper - however, if you want to stick with a traditional carrier and want the latest phone, the trade-in option might be great!
6 - Employer discounts
If you work for a large corporation you may well be eligible for a discount. My wife’s former employer gave us a 15% discount on the line rental for our previous provider (Verizon). It wasn’t a large enough discount for us to stay, but had we stayed there was no reason not to take advantage of it!
7 - Talk to GetFinHealthy
If you want help with your specific situation or want to discuss your ideas on making this blog better - contact us!