How to Save Serious Money by Switching Cellphone Carriers

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Now that cellphone contracts are a thing of the past, switching carriers is one of the best ways to save yourself some serious cash, especially if you’re in need of a new phone. Before you switch, here’s five important things you need to know.

1. Switching gives you access to bargains

You may be wondering what the benefit of switching carriers is — is it worth the hassle of porting your phone number over and finding a new plan? The short answer is yes, absolutely. Switching carriers is especially a smart idea if you’re in need of a new cellphone. You may have noticed that carriers frequently advertise special deals on new cellphones and plans. Whether it’s a buy one, get one free deal, or it’s a discount off a plan, these deals are always on offer.

But here’s the catch: Most of these deals are only offered to new customers only. This means, if your current carrier is offering 50% off a new iPhone XS, you’re more than likely not eligible for this deal. You may be eligible for a lesser deal — $200 off for an upgrade, perhaps — but the best deals are always offered to those only adding a new line of service, i.e., new customers. But you likely are eligible for the best deal from your carrier’s competitors. So, if you want the best deal on a new phone, it’s time to switch.

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2. Your carrier may not unlock your phone

If your current cellphone is perfectly fine but you’re ready to switch to a cheaper or better plan with a different carrier, you definitely have the option of bringing your own phone (BYOP). However, there are a couple of things you need to be sure about first:

  • That your cellphone is compatible with your new carrier.
  • That your phone is unlocked.

If you have a newer phone from, say, the last two or three years, it’s likely your phone will be compatible across all carriers. You can always check on your potential new carrier’s site to check phone compatibility first before buying a plan.

When I say your phone needs to be unlocked, I’m not talking about entering a PIN into your phone to get into it, I’m talking about getting it network unlocked. When you buy a phone from a carrier, it’s more than likely that it’s locked to that specific carrier (some carriers, like Verizon, sell their phones unlocked). Getting it unlocked so you can take it to another carrier seems like it should just be a matter of contacting your carrier, but there is some fine print you need to be aware of.

Generally, you’ll need to meet these requirements before your carrier will unlock your phone:

  • You’ve had an active plan with the carrier for a specified amount of time (the period varies by carrier).
  • There is no outstanding balance on the phone or plan.
  • The phone hasn’t been reported as lost or stolen.

3. Do not cancel your current plan

Chances are, when you switch to a different carrier, you’ll want to keep your current phone number. It’s important that you DO NOT cancel your current cellphone plan before you port your number over to your new carrier. In fact, you shouldn’t need to cancel your plan at all. Here’s what happens when you want to keep your number:

  1. Sign up for a new plan with another carrier.
  2. Let your new carrier know you’d like to port your number (keep your existing number).
  3. Your new carrier will transfer your number from your old carrier.
  4. Your old carrier will automatically cancel your account and send you a final bill, if necessary.

If you cancel your account before your phone number has transferred over, you risk losing your number completely. So, don’t worry about canceling your plan at all; your new carrier will handle that for you.

4. Bigger isn’t necessarily better

If you’re hesitant to switch carriers because you get great coverage with your current carrier, there’s something you need to know. Smaller carriers such as Metro, Boost Mobile and Cricket, all run off of one of the major networks — AT&T, T-Mobile, Sprint or Verizon. So, if you’re with AT&T but sick of paying $70 per month for your plan, switch to Cricket Wireless and pay just $55 per month for unlimited data all on the same network. You’ll still get the same great coverage even though you’re no longer on an AT&T plan.

Check to see which network the carrier uses first and check coverage in your area before you switch.

5. Make sure you’ve paid off your phone

If you’re still paying off or leasing your phone through your current carrier, you’ll need to be careful about switching, especially if you got a special deal on your phone. When you switch carriers and subsequently cancel your current plan, your old carrier is going to send you a final bill which includes the remaining balance on your phone. If you got your phone on a special deal, you’re going to have to pay back the remaining nondiscounted balance.

For example, if your iPhone cost $500 after a 50% discount on a 24-month installment, then you cancel your plan after just 12 months, you would think you only owe $250. But the reality of it is, your carrier will bill you for $500, which is the remaining balance on the phone without your 50% discount. This is because your discount is applied as credits spread out over 24 months ($1,000/24).

If you’re leasing your phone from Sprint and cancel your account early, Sprint will bill you for the remaining balance on the lease, but still take your phone back. So ending your lease early is definitely not recommended.

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