When Leasing Your Cellphone Makes Sense, and Saves Dollars

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Triumphant woman with cellphone
Dean Drobot / Shutterstock.com

This post comes from partner site WhistleOut.com.

We all know the saying — “Rent money is dead money” — so it may seem like a no-brainer to say no to leasing your cellphone. However, with new cellphones being released regularly, and that little voice in our heads telling us to go buy the newest model of the iPhone, it might actually be cheaper to lease a cellphone. Here’s why.

Cost of leasing versus buying

Even though you won’t own your cellphone at the end of your lease, if you plan on upgrading to the newest phone in a year’s time, leasing makes a lot of sense. You can simply turn your phone in and get a new one next year, which is probably what you’ll be doing anyway if you buy your cellphone.

Here’s a comparison of getting the new iPhone XS (64GB) on Sprint’s Flex Lease versus buying it outright or through monthly installments (excluding any special deals or promotions).

Note that the prices listed here are for the iPhone XS only and don’t include the additional cost of the cellphone plan.

Monthly Cost Upfront Cost Total Cost
Outright from Apple $999 $999
Sprint Flex Lease
(18 months)
$41.67 $750.06
Verizon Installments
(24 months)
$41.66 $999.84
T-Mobile Installments
(24 months)
$42 $279.99 $1,0081
AT&T Installments
(36 months)
$33.34 $1,200.24

1 Includes tax

With Sprint’s Flex Lease, then, not only is leasing the phone cheaper than buying the phone outright, but you also have the option to upgrade after just 12 months. So, essentially, you would only have to pay $500 ($41.67 x 12) for a new iPhone XS and upgrade a year later to the next new iPhone.

Is leasing for you?

It seems leasing a cellphone can be a great option if you like to upgrade to a new phone regularly. If you’re going to get a new phone in a year’s time when Apple or Samsung release their newest model anyway, why spend all of that money to buy your phone? You’ll either need to sell it, trade it in or amass a big collection of dead cellphones.

Yes, you might be able to sell it after a year and make some of your money back, but if you don’t want that hassle, then give leasing a shot.

If you’re usually happy with the cellphone you have and don’t need the latest, greatest model, then buying your phone outright or buying it over monthly installments is a better long-term option.

Once you’ve finished paying off your cellphone, you’ll own it outright and you’ll be able to sell it, switch carriers, do whatever you want with it!

When you eventually want to upgrade to a new phone, look out for special deals from various carriers. You’ll likely find huge discounts on new phones when you trade in your current device — as long as it is still in good working condition and isn’t damaged.

Who offers leasing options?

Sprint is currently the only carrier that offers a cellphone leasing option. Other carriers like AT&T and T-Mobile have monthly installment plans with add-ons so you can still upgrade your device after a year or two, but you’ll actually own the phone once you’ve finished making your monthly payments.

With Sprint’s Flex Lease, you’ll have the choice of upgrading to a new phone after 12 months on your lease or leasing for the entire 18 months.

At 18 months, you’ll have the following choices:

  • Upgrade to a new phone
  • Buy your phone outright
  • Continue to lease the phone

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