Choosing a mobile plan to suit you
Selecting a mobile phone plan is one of the challenges of modern life. There are literally hundreds to choose from and their complexity makes it very difficult to compare the cost-effectiveness of plans between different companies.
So, choosing a plan is a good test of your research and analytical skills, and your ability to make a rational decision – rather than an emotional one! Even a small amount of research can help you choose the most appropriate plan for your needs.
Basic types of mobile phone plans
Mobile phone service providers call their plans all sort of names, but they generally fall into the following broad categories.
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Plan
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How it works
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Advantages
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Disadvantages
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Prepaid
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You purchase your phone or bring your own phone and pay for calls in advance. When you have used your allocated prepaid calls you simply top up your account to keep your phone working.
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You know what you’re up for so there are no billing surprises. Prepaid is a popular solution for teenagers and first time users.
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Generally call charges for prepaid mobile plans tend to be higher than with contract plans.
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Pay-as-you-go
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You get a bill at the end of each month without locking into a fixed-term contract.
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You’re not locked into a contract so you can swap plans easily if you wish. Call charges can be cheaper than prepaid options.
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You generally don’t know what your bill will be until you receive it.
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Fixed-term
contract
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You commit to a particular service provider for a specified time, usually between 12 and 36 months.
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You can buy a new phone as part of the plan, so don’t have to pay for a phone upfront. Call charges can be cheaper than prepaid options.
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You generally don’t know what your bill will be until you receive it.
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How to save
1. Seek the opinions of family and friends about their own mobile phone service. Also, phone companies sometimes offer free or very cheap calls at night or on weekends between numbers on the same network. So it's worth knowing which network most of your friends and family are using before committing to a plan.
2. Carefully review a range of mobile plans from different providers that match your general phone usage. There are call plans that offer substantial discounts depending on whether your calls are usually short or long, and whether most of them are made during peak hours (generally 7am to 7pm), or off-peak (normally 7pm to 7am).
3. Compare both the call rates and ‘flag fall rates’. The difference between calls being charged per second, or in blocks of 30 seconds, can make a big difference to your bill. It means, for example, that even if you made a call that was just over 30 seconds in length, you would be charged a full minute. It’s a small difference that can add up.
4. When estimating your usage, be realistic. A common mistake of first time users is thinking they'll use their mobile sparingly. It leads them to sign up to a low-use plan that has a lower monthly access fee, but higher call rates. They often under-estimate their phone use and end up with a big bill!
Check out Why Adrian pays the most for his mobile.
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