New smartphones are coming out each year and if you love consistently updating your device, then you’ll need to consider getting a contract phone or a single payment one.


Contract phones networks provide you will pay on an instalment basis. Paying small increments for a smartphone per month does sound convenient. However, it has some huge downsides that bring you to bigger expenses if you’re not careful.


The same goes for single-payment devices. Nothing is really infallible for both. However, if you knew the advantages and disadvantages of both types, you can reach a compromise. Read on to find out more about these two phone contract types.


Contract Phones




Payment is Spread Out


You are willing to pay for time instead of the phone’s actual value by using a payment plan to purchase a contract phone. Its convenience is you pay with small amounts per month. This makes it easy to budget and use the device at the same time.


Device Insurance


Network-sold contract phones often come with device insurance. These third-party options allow you to receive a similar phone in case you lose or break your device within the stipulated reasons. It may or may not come with the network’s advertised price. You can ask them about it to clarify.


Network Priority


Owning a network-exclusive device, the network provides premium options and perks for you. For example, you will be least affected by network congestion. The service provider will prioritise all network-exclusive devices before prepaid subscribers. Your device still has the ability to make calls, send messages, or access the Internet even if you surpass your allowances for a particular month.




More Expensive


The small payments you are making for your device have little increments that can inflate your device’s price by 25% of its original price. While some networks offer discounted phones, most deals concentrating on newer devices will inflate its original price. These small increases are separate from your typical monthly phone bill.


Less Freedom


Your contract phone is exclusive. Therefore, you cannot use the device with other networks even after you finish your contract. As you have entered a contract, you have responsibilities to fulfil. Failure to do so will result to huge termination charges. And you cannot use your device overseas without paying additional fees to activate your roaming and other additional services.


Fewer Choices


You can only choose devices within the network’s roster available to would-be subscribers. If they are not exclusive Apple distributors, for example, then Android contract phones are your only option. Networks may opt to distribute only two or three particular brands, which can be limiting especially if you are looking for a particular device.


Single-Payment Phones




Huge Savings


The months or years of saving money for a brand-new phone pays off because you’re paying less than you would for a contract phone. Payment plans add a small percentage on a monthly or yearly basis, which makes the final bill expensive. However, a single, one-time payment gives you full phone use without any strings attached.




You face no credit checks buying a single-payment smartphone. You can use your phone overseas, remove your current prepaid SIM card and replace it with local networks to help you save money. If not, you can use Wi-Fi services conveniently without having to call the network to activate your phone.


No Network Exclusivity


You incur no additional charges using a single-payment smartphone. Owners need only to provide credits to use the network’s prepaid services. If you are tired of your current provider’s services, switching to a new prepaid service is quick and easy. You will not need to call anyone to help you switch networks too (unless you don’t know how to remove and replace a SIM card with a new one).




Network Low Priority


However, when the network faces congestion, it will not prioritise prepaid users. Most contract phone owners experience better connections in congested or sparse network conditions. Part of contract phone owners’ monthly fees pay for this particular aspect.


No Customer Service


Prepaid users virtually have no customer service to talk to. Incidents wherein credits fail to show up or an intruder penetrates your device using your prepaid service will not have any ears from the network companies.


Lack of Long-Term Perks


Contract phone owners can enjoy their devices. If they stay dedicated to the network, they can receive new smartphone models at discounted prices, sometimes even free. Prepaid users with single-payment phones do not enjoy these bonus perks even if they have been with a specific network’s prepaid service for years.




Both contract and single-payment phones have their perks and troubles. The best way to find the right phone for you is to identify your device priorities. If you need a device for professional or communication use as a priority and you lack enough funds to purchase one, then a contract phone is an excellent decision. However, if you do not need a new phone and are just replacing a fully-functioning one, then you can always save more with single-payment phones.


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