We’ve been doing a couple of guides for prepaid phone plan options, and what they really mean on this site for a couple of reasons. Number one, we feel that wireless service providers aren’t doing a good enough job to promote their prepaid phone plan options. At least in certain parts of the world. This is a deliberate strategy by service providers. Since, most of them want to get people on their postpaid plans to essentially ensure that they stay with their company for the long run. Unfortunately for consumers the tricks that some of these companies imply to get you to say with them are not in your best interest. Therefore, we wanted to create this article not only to answer, “What is a prepaid phone plan”. We also want to make sure people know the pros and cons of being in one.
When you look at commercials from the common service providers particularly in the United States you’re going to see them promote certain rates that you’re not going to be able to get at their stores. Why is this? The first thing that you need to account for, are fees and taxes. So you won’t be paying the 30 or 35 dollars a line that the commercial says, ever. Just with taxes alone your overall cost is bound to go up. Fees though, and minimal requirements are your real enemy in postpaid plans. They can get so bad that prepaid plans may become a better option. Even when they may not look so great on paper. We’re going to answer what is a prepaid phone plan, and we’ll hopefully help you decide if it’s the right option for you.
- What Is A Prepaid Phone Plan? – The Simple Answer
- Main Benefits of a Prepaid Phone Plan
- Cons of Being On A Prepaid Phone Plan
- What Is A Prepaid Phone Plan – The Must Haves Before Getting Into One
- What’s More Expensive Prepaid or Postpaid?
- Do All Companies Offer Prepaid Phone Plans?
What Is A Prepaid Phone Plan? – The Simple Answer
The simplest answer that we can come up with is that a prepaid phone plan is a plan that you pay for before you have access to the coverage. We were going to say that it’s not a plan that you pay at the end of the month. However, the actual dates don’t have much to do with it. Since with a prepaid plan you can go out and get coverage virtually any day. Once you use up the coverage or the credit validity runs out then you lose access to the network. With a postpaid plan you get a bill at the end of the month that you have to pay for. Traditionally, with prepaid plans you don’t get a bill at all. Instead you are the one that has to seek out and buy the coverage.
Another aspect that is kind of particular to prepaid plans is that users have the option to go out and seek the type of coverage that they’re actually going to use for a specific period of time. With post paid plans it’s true that you of course have the chance to pick the type of coverage that you’re interested in. However, you make that decision one time, and you’re pretty much stuck with that coverage until the end of the contract. To change the type of coverage you get you’ll need to buy add-ons or find a way to alter your contract. This may be easier said than done with some service providers. At the base of it all though, to answer what is a prepaid phone plan? We’d say a prepaid phone plan is when you have to go out and buy coverage instead of getting a long term deal.
Main Benefits of a Prepaid Phone Plan
Now that we’ve established the answer to the question, “What is a prepaid phone plan?” We can start talking about why you may want one. When push comes to shove we would have to say that the number one benefit that you have with a prepaid phone plan is that you’re not obligated to pay the phone company anything. You pay for what you use and nothing more. There’s no possibility of getting hit with extra fees from your wireless service provider. Perhaps most importantly you won’t be on the hook for any kind of cash with them. That being said there are certainly more benefits that you’re going to be able to obtain with a prepaid plan.
We’ve already mentioned that you pay for what you need for that month or even a couple of days. On top of that you’re essentially going to be able to pay who you want for the service. If you’re on a post paid plan you’re essentially tied at the hip with your wireless service provider. At least for the length of the contract. With a prepaid plan you could potentially buy service from one company one month and switch to another company the next month. This allows you to bargain shop and continue to look for the best deals all of the time. To recap, you’re never on the hook with a phone company. You can pay for what you need that month. Plus, you can go ahead and switch service providers without major hassle. There are a couple of things still to account for, but we’ll get to those.
Cons of Being On A Prepaid Phone Plan
As with anything in life, things are not necessarily always sunshine and rainbows with prepaid plans. There are certain aspects that may not be ideal. Some service providers for example don’t grant users of prepaid plans access to their top network. For example for years T-Mobile didn’t let prepaid users access their 5G network. They had to stick with 4G speeds when everyone else was on the faster network. Another main con is that you can’t buy a phone off credit from your service provider. There are other ways to get a phone paying a monthly fee. You just can’t buy a phone on a monthly fee from the service provider.
Postpaid plan users are typically on better terms with the wireless service provider. Let’s take Verizon users for example. Currently, folks on a postpaid plan can access Disney+ and other streaming services that are included in their phone line fee. This is something that you’re not going to be able to obtain as a prepaid user. At least not right off the bat. There are some companies that are more rewarding for prepaid plan users. They’ll give them discounts on their service if the prepaid user recharges their monthly allowance every month and things of that nature. In general though we would have to say that prepaid phone plan users are treated a bit like second class citizens with wireless service providers.
What Is A Prepaid Phone Plan – The Must Haves Before Getting Into One
We want to talk about some of the things that you should know before you pick a prepaid plan. There are a lot of people out there who are not fully satisfied with their phone plans. Part of that, is the fact that certain wireless service providers aren’t exactly an open book when it comes to talking about fees and other things that you’ll be expected to pay. The second thing is, many people get into plans without first understanding their own usage rate for the phone. What do you need more of? Calls, minutes, data? Look for a plan that actually matches your usage for the phone. Otherwise you’re always going to feel like you’re getting robbed. The must have here would be the knowledge of what you use or need the most.
Another must have specifically for prepaid plans is an unlocked phone. You’re going to be selling yourself short if you’re locked into a service provider with a prepaid plan. You can get an existing device unlocked before you enter the contract. You also can go ahead and buy an unlocked phone. Many people stay on bad post paid contracts before they are still paying off their phones. Since, it’s essentially a lease that they’re giving you, you’re locked into the company for life. Don’t buy phones directly from your service provider. Unless you just love the service they give you. You can get the same leasing deal with a phone manufacturer. Then get the plan you like from the wireless service provider.
What’s More Expensive Prepaid or Postpaid?
There are prepaid phone plans that are going to be less expensive than postpaid plans. You can find the same is true the other way around though. There are two main things though that you’d do well to keep in mind. The best way to be able to lower your bill on a post paid plan is to get more lines on the same contract. If you have a family you can pay less per line on a postpaid plan than you would if you got everyone prepaid plans. You can get into a multi line contract with friends. The problem is, someone has to be the main sponsor for the line and collect the money. If one person doesn’t pay up on time, the others have to pony up the cash it can be an issue.
You can actually also lower your cost on a prepaid plan if you choose automatic renewals, just like a postpaid plan and add lines to your account. If you’re on your own though the real way to keep the bill low is also to just pay for what you use. Don’t get lured into massive plans that offer a ton of features. Look for the features that you’re actually interested in using. In doing so you can limit your bill considerably if you put your mind to it. Also if you limit your minute or data usage you can lower the bill. If you’re on a long term bill even if you don’t use up all of your minutes or data you’ll get charged the same amount at the end of the month.
Do All Companies Offer Prepaid Phone Plans?
We actually want to say yes. In fact, there are some companies out there that only offer prepaid plans. As far as we know at this point all of the main wireless service companies, at least an America offer some type of prepaid plan. Granted, sometimes you have to look long and hard on the company site to be able to find their prepaid options. There are a couple of reasons for that. Where some of these companies really make the money is leasing out the phones through their credit programs. So they want you on a long term deal. Plus, on long term deals they can hit you with fees. That’s not something that you’re going to see happening to people on prepaid deals.
What Is A Prepaid Phone Plan? – Conclusion
What is a prepaid phone plan? If I agree to renew my plan automatically as some companies offer does that still count as prepaid? Essentially yes, because you can cancel at any time. You also have the liberty of changing your deal on a month to month or week to week basis. To match the demand that you’ll have for a given time. If we look at it, we’ve come a long way from the days of phone cards and things of that nature. Although a lot of the concepts that applied to prepaid phone plans back then technically still apply today. What’s changed essentially is that you don’t need to go anywhere to get an actual card to activate the service. You can do it through an app.
We hope that in finding out what is a prepaid phone plan you were able to also decipher what option works best for you. Maybe not the particular deal that you want to go after. However, the idea behind this article was to make sure that people got a good sense of what they could expect to see in a prepaid phone plan and a postpaid plan. We believe that each suits the needs of different individuals. Therefore, it’s really hard for us to be able to pick a real winner in this fight!