Phone

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How to Save Money on Cell Phones

Posted on by David

The average cell phone costs $471 and the average premium phone costs over $1000! According to a Time Magazine poll, 84% of people surveyed said they couldn’t go a single day without their mobile device in hand. Given how important cell phones are, and how expensive they’ve become, how does one save money on cell phones?

Hardware as a Service

While a cell phone may seem like a one-time purchase, it’s getting harder and harder to treat it as one. Instead of being something you make last until it finally dies, the prevalent attitude about smartphones is to upgrade sooner rather than later. With the advent of the smartphone, the cell phone has grown to become a “hardware as a service model”.

What do I mean by that? Two things: 1) Each new model of smartphone comes with new features you may or may not want (Which you have to upgrade to get), and 2) manufacturers only support a certain model for so many years. It seems like every phone these days is advertised not by processing power or battery life, but by its better camera, new ID technology, and storage. These new features may be useful to you, but whether or not they are is irrelevant. The problem of “hardware as a service model” comes from the second point. Let’s look at an example.

In 2018 Google released a shiny new Google Pixel 3. With it came Android 9 Pie. The next year when Google released Android 10, the Pixel 3 was able to update and install it. Android 10 came with new software features like Dark Mode. It also came with new security patches. Google has promised support for the Pixel 3 until October of 2021. That means the Pixel 3 will be able to update to Android 11 and 12 and get security updates until October of this year.

But what happens after October 2021? Well if you have a Pixel 3, it means you won’t get any new software features that come with new versions of Android. For better or for worse you may want those new features or you may not. But more important than the new features, you will also miss out on the security patches that that come with Android updates.

Technical Security

I’ve personally never needed the newest smartphone features. I really just want my phone to be able to call people and surf the internet, but I’m very concerned with having the latest security updates. With more and more of our lives being online, technical security is a very real concern. In the US in the past 5 years there have been 6,469 data breaches totaling over a billion (1,026,000,000) records exposed. That’s three per person just in the last 5 years. And as I am morally against bad statistics, I am duty bound to remind you that since that includes children that are too young to have any online presence, that number is likely higher per person.

Source: Statista

These stolen records are usually credit card numbers, usernames, and passwords. The kicker in these data breaches is that nearly all of them could have been easily avoided by installing security updates. In these cases hackers exploited vulnerabilities in software that was either not updated or no longer supported by the manufacturer. This is why it is imperative that you update software on your electronic devices and that includes smartphones.

If your smartphone manufacturer no longer supports your smartphone, you are not getting security updates. Because of this, your phone will become increasingly vulnerable to the malicious intentions of bad actors.

To Upgrade or Not

All this to say that though in theory people don’t have to buy new cell phones regularly, in practice upgrading periodically is a necessity. In 2020 the average phone sold in North America cost $471 and increased by 7% annually. And as of 2018 the average smartphone user waited 24.7 months before upgrading. This comes out to an annual expenditure of $228.83/year on cell phones.

North America spends the most on cell phones. Apparently you can save money on cell phones by moving to Africa.
Source: Gizchina

So the average American spends $228.83/year on cell phones. $229 a year doesn’t seem like a lot of money but if you put that money into the stock market making 7% interesting, assuming a 7% increase in price, after 20 years that’s $16,536.93. In 2017 the iPhone X was released at a starting price of $1000. And as of 2020 the average premium smartphone is now over $1000. If you bought the flagship iPhone model every year for 20 years, it would set you back $72,330.55! This number, of course, is assuming a 7% increase in price.

That is the cost of buying new smartphones. Obviously very few people buy a new iPhone every year, but the average American is spending hundreds of dollars a year, and losing out on thousands in potential savings. How can they possibly save money on cell phones?

iPhone or Android?

I know this seems counterintuitive, but buying an iPhone is the better financial decision. I say this because, while Android phones are cheaper, Google only supports them for a couple years. They’ve promised to support their own phones, the Pixel line, for three years. Other high end Android phones, like the Samsung Galaxy line, usually get 2 years, and some of the cheaper android phones don’t get any updates. Google is working to change that because of security risks, but they won’t ever get more than 2 years of updates.

Apple on the other hand doesn’t promise any specific support window, but they’ve consistently supported phone models for 5-6 years. That means that if you pay $800 for a new iPhone that lasts you 5 years you’re spending $160/year on a smartphone. On the other hand if you buy a budget $400 Android phone that is supported for 2 years, you’re spending $200/year on a smartphone. As you can see in this case the iPhone is a cheaper option even though it initially costs twice as much.

As a rule of thumb I like to keep my cell phone budget to less than $100/year. If I spend $200 on a smartphone I hope to keep it at least 2 years. But I won’t keep a smartphone past its support window. This is the same reason I don’t use Windows XP: using software that’s no longer supported is a security disaster waiting to happen. For example I spent $190 on an iPhone 7 in fall of 2019. It should continue to get security updates for at least another year. If Apple stops supporting it in fall of 2022 then it would have cost me $63/year to use this phone.

Both iPhone and Android suffer from a short support window. Microsoft supports their operating systems for like 10 years. Shame Microsoft is awful at making phones.
The people that fight about which mobile operating system is better are much more entertaining than either phone could ever be.

Buy Used

The easiest way to save money on cell phones is the same as saving money on cars: Don’t buy a new phone. There are many ways to purchase used smartphones. Aside from general sites like Craigslist or eBay, there are several sites specifically for buying and selling used cell phones.

Swappa

Swappa is a site where sellers can list their old phones and buyers can buy from them directly. In that way it’s like eBay, but Swappa has specific rules such as the phone has to be working, clean, and not blacklisted from any carrier. I originally used them because they had a deal with Ting that would guarantee with phones worked with Ting and would come with a free SIM card. They are also usually the best deal I can find.

Swappa is mostly for phones, but they also have computers, tablets, and video games. They currently have the iPhone SE 2nd Gen starting around $215. And since the SE will probably be supported for another 3-4 years, that comes out to only spending $70/year on an iPhone!

Gazelle

Gazelle is a site that buys old smartphones, refurbishes them and then sells them at a discount. I bought my wife an iPhone SE 2nd Gen for $265 last fall. The SE 2 was new that year at $400 so $265 was a great deal. If Apple supports it for 5 years, that comes out to $53/year. Nearly half of my phone budget! I didn’t actually have a good experience with Gazelle or their customer service team, but I did get a great deal.

Back Market

Back Market is another site that buys old smartphones and refurbishes them for sale. I’ve never used it, but I’ve heard good things.

Conclusion

In conclusion, smartphones are hardware as a service. Because they shouldn’t be used outside of their support window, customers need to regularly upgrade to stay safe. Because of this you can’t just buy a cheap phone and use it forever like you can most things. This is why I propose the $100/year cell phone budget. I aim to spend no more than $100/year on cell phones.

This means I buy my phones used and then keep them until their manufacturer no longer supports them. Furthermore I pretty much exclusively buy iPhones because Apple supports their phones much longer than Google does. That said I don’t really have brand loyalty. I would by an Android if it were a better financial decision but for now I believe iPhones are the better deal on a per year basis. I recommend, as always, that you do your research.

What do you think? Which phones do you use? How much do you spend per year on cell phones? Let us know in the comments below!

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Save Money on Your Phone Bill with Ting

Posted on by David

The average cell phone bill is $70/month or $840/year for a single line according to JD Power. And a family of 4 can expect to pay anywhere from $120 to $220 a month for 4 lines from a major wireless carrier according to Tom’s Guide. Allconnect estimates the average cost of a single cell phone plan at $113 and $170 a month for a family of 4. My cell phone bill was just $11/person per month last year. How did I accomplish that? Here’s how to save money on my your phone bill with Ting.

Full disclosure, this post is not sponsored. I’m just a happy customer.

Ting has been around since 2012 and got their start by buying airwaves from Sprint. There was a flat rate for the number of lines you had and the rest was billed in buckets of minutes, text messages, and data across those lines. If you didn’t use your cellphone as your primary phone (ie, you had a landline) and didn’t use much data, it was a great alternative to an expensive phone plan with the Big Four carriers.

Using Ting it's very easy to save money on your phone bill

It worked for my family because we had a landline and we didn’t use much data because we had wifi at home (like nearly everyone in America).  The four of us usually kept ourselves under 500 minutes of talking, 1000 text messages, and 100 MB of Data. So it rarely costs us more than $41/month.

After moving out my sister and I started using our cell phones as our primary communication devices so minutes and texts went up. We combated this by getting google voice and using that for our longer conversations. It helped for the most part, but even if we went over on minutes or texts, Ting was still wildly cheaper.

Then I got Married

After getting married we added Courtney onto our mobile plan for a total of 5 lines. That extra line tipped us over to the next bucket for several of these. (That year Pokémon Go also came out but I’m sure that didn’t affect my data usage at all *cough* *cough*). At 5 lines, 1000 minutes, 2000 text messages, and 500 MB of data, our monthly bill was looking more like $66-$83 per month. That is still so much cheaper than just about any other option. Especially for 5 people.

We did this for a while, then Ting was bought out by Dish. We’re still not sure what that means for customer service or reliability, but after this they changed the billing system. Their new plan is much simpler: Unlimited Talk and Text for $10/line plus $5/GB shared across all lines. They have other plans if you need more data, but this has worked great for us.

New Ting plan has unlimited talk and text
New Ting plan has unlimited talk and text

So with 5 lines and never going over 1GB of data our bill comes out to $55/month or $11/person!

But what if I need Data?

I’m going to say something a little controversial: you don’t need that much data. It’s been my experience that no one needs data, or at least no one needs as much data as they think they do. No one needed it ten years ago and now that nearly every home, business, and restaurant has wifi, there’s no need to use cell data. The most data we use is for Pokémon Go and even that only ends up being like 200 MB/month.

Everywhere I am has wifi. The only places that don’t are when I’m actively driving and at the park. And you don’t need to use your phone when driving or enjoying the outdoors. You can stream music or watch YouTube videos on data, but you don’t need to stream music or videos when you’re out. But what if my work doesn’t have wifi I can access? You’re working, you don’t need to be on your phone. If you want to watch something while on your lunch break, download it before you leave home. Netflix allows a variety of episodes and movies to be temporarily downloaded.

Some people stream music when they’re driving or running, but that’s just a modern luxury. Just pretend it’s the distant past circa A.D. 2010 and put some music onto your phone. Modern phones have a crazy amount of storage now. You can put so much music on them! With the money you save by not paying for data, you could buy several albums a week.

What carriers do they have?

Originally it was just Sprint, but now they have deals with all the major carriers. We’re currently using them on Verizon’s airwaves, or the “Red Network” as they call it. Never had a problem with coverage.

Do I have to buy a new phone?

No. Ting works with nearly any phone. They have a phone checker that will make sure your phone is compatible with their networks, but pretty much any modern phone will work now that the government has forced the Big Three to play nicely. If your phone doesn’t work on Ting or you just want a new phone they have a shop where they sell compatible phones at or below new prices. That being said I only buy used phones from Swappa.

What if I *actually* need data?

They have other plans that are more data-friendly, like unlimited talk and text and 5 GB of data for $25, but for the most part we don’t *need* as much data as we think we do. The less data you use the more you can save money on your phone bill.

What about Google Maps?

Google maps uses surprisingly little data. An hour trip might use like 30 MB. If you use Google maps a lot, you can download an offline map while at home then you won’t need data to use the GPS.

Captain Picard saved money on his phone bill by switching to Android
Captain Picard saved money on his phone bill by switching to Android

Conclusion

I like Ting a lot. Our family spends roughly ¼ of what the average American does on cell service. And now that they have unlimited talk and text for $10/line it’s pretty hard to complain. I don’t use much data and frankly have never felt that I needed more than the 1 GB we use. Even for a family of 5, we only ever use a few hundred megabytes. Remember mobile data is a luxury, and while it’s ok to indulge in the occasional luxury, they aren’t needs.

What do you think? How much do you spend on cell service? How do you save money on your phone bill? Have you been looking for a new cell plan? Let us know in the comments below.