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Thinking of signing up a carrier installment plan for your new phone? You might want to think twice

ByinTips & Guides | August 31, 2015

US Mobile Carriers
For many years a two-year contract with a carrier was the most often chosen form of acquiring a new phone and service, since it allowed you to buy a brand new handset at a fraction of its retail price or sometimes sometimes even for free. Recently, though, this option lost some of its appeal mainly because it prevents users from frequent upgrades. In order to meet subscribers’ needs, carriers started moving away from long-term agreements, offering customers installment plans in their place. However, before you sign up for this option, you may want to consider few things since it may not suits everyone.

Carrier installment plans – Ups and Downs

Instalment Payments Plans


Installment plan might be a perfect choice for users who can’t afford to pay full retail price for the phone upfront. It spreads the cost of the phone over a longer period of time which is much easier on the budget. Typically, installment plans last up to 24 months, but now worries, you don’t have to wait that long to get a new phone.

After you pass a certain threshold in a payment plan, you become eligible for upgrade. For instance, AT&T offers customers three options – AT&T Next 12, Next 18 and Next 24 with the price of the phone divided into 20, 24 and 30 installments and allowing for upgrade after 12, 18 and 24 payments, respectively.

Verizon allows users to pay off their new phone in 24 monthly installments and become eligible for upgrade after 75% of the device’s price has been paid. Sprint has similar rules when it comes to plans and upgrades. T-Mobile, the first carrier to ditch contracts thanks to the UnCarrier movement, allows subscribers to upgrade their phones as often as three times a year.

For this reason, installment plans are a great option for these folks who want to have the latest phones on the market. With monthly finance plan there is no need to wait two years to get a new phone so you can always be up-to-date. Moreover, such plans appear to be cheaper than contracts, since you don’t have to pay off full retail price to become eligible for upgrade.


Despite of the all benefits, here are few things you should be aware of before you get into installment plan. If your phones, for example, are prone to serious accidents, installment plan may not be the best idea, since even if the device is damaged to the point of uselessness or is lost or stolen, you still have to pay for it.

In order to get a new phone, you need to trade in your current device and it must be in working condition so if you are rough with your electronics, you may have some problems with meeting this condition. Keep in mind that trading off your phone means that you will never be a fully owner of the phone you pay for, and won’t be able to resale it or keep it as a backup after the plan is over.

Furthermore, even with the price divided into monthly payments, the cost of a new phone may be pretty high, so if you tend to bond with your devices and don’t need the latest handset every year, there is no need to pay full retail price for a new phone. If that’s the came you may want to look for an offer that allows you to bring your old phone.

Final word

It goes without saying that installment plans are a more flexible option than contracts, however, as everything, it come with a price and may have some disadvantages. That’s why it’s crucial to determine what exactly you need before making any decisions. So, what consumer are you? Would you opt in for installment plan?

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