A few years ago when pay-as-you-go or 12-month contracts were the norm, churn was massive in the mobile business and the phone companies desperate to hold on to customers.
But with the advent of smart phones, things changed. With large up-front and monthly payments few are willing to pay out their contract, so companies are less willing to bend over backwards to keep you.
But you can still save money. First, analyse your usage. “If you use less than 150 minutes a month and send fewer than 100 texts a month, then pay as you go is almost certainly cheaper for you, ” says Archna Luthra of MoneySavingExpert.com. She suggests using billmonitor.com, a website developed by telecoms regulator Ofcom which can automatically – and rather cleverly – analyse your phone bills and search the UK’s available tariffs to find which suits you. Then you can ask your provider to match the best deal on the market. They usually will.
If you are tempted by money redemption deals, think hard. It can be hard to get the money back since the conditions can be onerous. And if you are offered a TV or a Playstation with a phone, then do the maths carefully as they often cost more than if you got a slightly cheaper phone and paid for the gizmos separately.
If you want an iPhone, also think carefully. Yes, it’s chic and the apps are good, but there are other phones now that cost £10-15 a month less and are as good.
And if you don’t want to be stuck with the same phone for 24 months, there is a way to change without breaking the bank. Buy the phone outright and get a long-term SIM-only contract, then sell the phone six months on – an old smart phone can get you £150 with a company like Mazuma Mobile. Use MobileValuer.com to find who will pay the most for your phone.