This post comes from partner site Whistleout.com.
We’re all used to paying off our phones over two years and then upgrading to a newer model. All of the major carriers remind us when we’re eligible to upgrade — in fact, they encourage it. But is upgrading to a new phone every year or two really worth it?
Why we upgrade
The first question we need to answer is why we upgrade our phones in the first place. The most common reasons, include:
- Wanting the latest and greatest model
- Needing to replace a phone that’s broken or not performing well
- Wanting a better camera or display
- Just because we want something new
There are probably a lot of us who have upgraded our cellphones in the past for the last reason — just because. But before you go that route again, be clear about the cost.
The real cost of upgrading
With monthly installment plans, it’s easy to forget just how much we’re paying for our cellphones. It seems like — at most — it’s just a small amount added to our cellphone service bill each month. We get used to paying a certain amount, so we feel like it’s time to upgrade once our current handset is paid off.
But how much could we actually save just by holding onto our cellphones for a little bit longer? A lot, as it turns out.
I have a 128GB iPhone 7 and paid $27.09 a month for 24 months. I paid it off in October this year. While I was initially thinking of upgrading to the new iPhone XS for the better camera, I decided against it after running the numbers.
The new iPhone XS costs about $1,000, or around $42 a month for 24 months.
If I stick with my paid-off iPhone — which is perfectly fine — I skip that new $500 a year expense. And meanwhile, I can enjoy a monthly cellphone bill that is lower by $27 a month than it was — or a total of $324 a year — and put that money in the bank instead.
Benefits of not upgrading
In addition to the money saved by not upgrading to a new phone, there are other benefits to keeping your phone for longer. They include:
- You’ll be free to switch carriers: When you upgrade your phone on monthly installments, you’re basically signing up for a new contract with your carrier, even though you’re on a no-contract plan. Signing up for new monthly installments means you have to finish making your monthly installments while you are also on your carrier’s postpaid plan. You can’t make payments on your phone without having an active line with the carrier, so you’re basically stuck with your carrier until your phone is paid off (unless you want to pay off your phone in full).
- You could get a better phone, just a little later: As I’ve already mentioned, new phones are released each year. Each model promises to be better than its predecessor. So, waiting a little longer to upgrade your phone could mean you end up with a much better phone. On the flip side, some newer phones aren’t actually that much better than their previous models. Upgrading to the latest model could mean you’re paying much more each month for features that you barely notice.
In any case, even if you like having the latest and greatest, bragging rights don’t last long. New iPhones, Samsung Galaxies and Pixels come out every year. Your new phone will not be the newest phone after a year.
If you really must upgrade yearly …
If you’re an early adopter and can’t help but get the newest phone as soon as it comes out, there are some upgrade options you need to know about. Perhaps the best option for yearly upgrades is signing up for a Sprint Flex Lease. On a Sprint Flex Lease, you simply sign up to lease your phone for 18 months, but you’ll be able to upgrade your phone to the latest model after just 12 months.
This option is perfect for those who don’t want to actually own their phones but want to always have the newest model.
The other major carriers — AT&T, Verizon and T-Mobile — also offer early upgrade options. The great thing about Sprint’s Flex Lease, however, is lower monthly costs.
How switching can get you a cheaper phone
Do you have your heart set on getting the latest iPhone or Android phone? Instead of simply choosing the upgrade option with your current carrier, why not shop around?
Carriers are always offering deals — discounts, “buy one, get one free” deals, and even free phones for customers who switch over from a different service. These deals often are not offered to existing customers, so there’s a real benefit to switching carriers when you want a new phone.
More from Whistleout.com:
- “Save on the Best TV With These Cellphone Plans”
- “How to Limit Your Child’s Cellphone Usage“
- “Hidden Ways to Get More Out of Your Cellphone Plan”
Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.