Contract Phones vs Pay As You Go

A choice every mobile user faces is the kind of plan he wishes to invest in along with his phone. Two options are two year contracts and Pay As You Go schemes. To make the right choice one must understand the agreements each deal entails.

A contract phone is where the service provider provides the customer with a connection that is charged at the end of every billing cycle (usually one month). A certain type and number of services are provided for certain duration and are renewed only on payment of the bill, such as calls, text messages and data services. Pay As You Go phones allow you to load your account with money, which is gradually used up in calls, messages and data based on usage.

The foremost advantage of contract phones is that they are heavily subsidized. Carriers like Orange, Three and EE offer the handset free with the mobile phone contract. All contract phones have a monthly cost (effective monthly cost calculated over a period of 18-24 months) associated with them, making them an alternative for those who cannot spend too much all at once while buying a phone. The plan will usually involve a fixed amount of calls, messages and data, unless you selected an unlimited plan.

The range of offers and deals on contract phones is usually greater and they are generally more convenient, as they substitute a big upfront payment with small monthly ones. If you are unhappy with your contract, the agreement can be terminated or corrected at the end of a billing cycle, allowing for a certain degree of flexibility in terms of changing one’s plan or mobile carrier altogether. Contract phones serve a certain type of clientele who have specific needs regarding the convenience of always being contactable to a wide range of people (hence the numerous schemes). You must closely examine all the offers available on contract phones to better understand which one would suit your needs best as well as your pocket.

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