How to Pay Less for Your Mobile Plan & Smartphone: Sim Only Deals, No Deposit Contracts & More

The days when mobile phones could be considered luxury items are long gone. In fact, smartphones have been closer to a necessity for ten years now, most people’s instant connection to friends, family, work, relationships and fun. So we must all be pretty smartphone savvy by now, right?

Wrong.

In fact, many of us are still making basic mistakes when it comes to getting the right smartphone and mobile plan at the right price. As recently as 2018, Ofcom estimated that 1.5 million Brits are paying too much for their mobiles because they were still paying monthly fees even though their contracts had ended. And because so many people are getting bad deals and don’t understand the bargains that are available, there’s a general perception that mobiles are more expensive than they actually are.

Let’s get rid of that myth once and for all.

Let’s start with the basics. There are two main routes to go down when getting a deal from a mobile operator – Sim Only deals which just include your calls and data, or Contract Phones which include the mobile phone, plus a data and call package.

SIM only Deals

Let’s start with Sim Only. If you already have a smartphone you like, have been given one, or can afford to buy one (maybe used or refurbished, which is a great way to get a good deal), then a Sim Only contract is your cheapest way to get connected. There are a huge amount of deals out there, and they’re always changing, so you should shop around or check this Money Saving Expert Guide. Just $5 a month can get you unlimited phone calls and texts, though heavy data users might need to pay a little more.

Sim Only contracts can be extremely flexible, just lasting one month, or a little more binding at 12 months (these are the ones which usually offer the best value for money). The only catch, apart from the requirement that you have a mobile phone, is that they usually require a credit check.

If credit checks are difficult for you, that doesn’t mean you have to stay disconnected. That’s when you should explore a good Pay As You Go Sim deal. There are two kinds: ‘traditional PAYG’ where you buy credit and pay for calls, texts and data as you go and ‘bundled PAYG’ where you pay for an allowance each month, normally the cheaper option. As ever, it’s definitely worth shopping around, and trying to predict how much you will use your phone, though the virtue of ultra-flexible Pay As You Go deals are that you can change your option if you find you are paying for services you aren’t using.

Make the Most of Your Phone Contract

If you don’t have a smartphone, or need the latest model, phone contracts can still be an attractive option. They’ve been around since the dawn of the mobile phone age and are often the only way that many people have ever got their hands on a new phone. You are normally asked to commit to a two year contract (sometimes more) in order to get your hands on a “free” mobile phone upfront.

A free phone? What could be wrong with that? Well, quite a lot, if you aren’t careful. The phone isn’t free, of course, you are simply paying for it in installments along with call and data costs, and hidden mark ups often mean you pay more than you would have if you’d bought the phone yourself and then paid for data.

That doesn’t mean there aren’t bargains around, but you should do your homework and shop around. Never go to the mobile phone operators directly, try reputable resellers such as Mobiles.co.uk. They are almost always cheaper than going direct to a network, and sometimes cheaper than buying a phone outright. And the contract is still with a big provider so you get the same service, just with less damage to your budget.

Please bear in mind that contracts will always require a credit check, and while some operators will bypass that by allowing you to pay a deposit, that money is usually better spent on sourcing your own mobile phone and paying for a Sim on a pay as you go basis. Contracts are also, of course, inflexible by their very nature, and you must make sure that you renegotiate your deal as soon as they are over so you aren’t double paying for your mobile phone for years to come.

So which is better - SIM only or Contract Deals?

In 2021, mobile phones have become an essential part of modern life, and thankfully a range of deals has evolved which make them accessible to nearly everyone.

If you have a mobile phone or can get one at a good price, your best bet is likely to be a Sim Only contract, requiring as little as $5 a month to stay connected. If you don’t already have a phone and don’t think you can afford one, a contract might be a good option, but please spend some time making sure you get the right deal. If you have credit check problems, then we’d recommend a Pay As You Go Sim deal, and finding a bargain mobile phone to pop that Sim into.

When you hear your phone buzz, you want to pick it up with excitement, not with a sinking heart as you remember you could have got it much cheaper.