Mobile Phone Plans Buying Guide

Can I bring my own mobile phone rather than going on a mobile plan?

When it comes to a handset you have two main choices. Either you can a) bring your own – This could be one you had already, or one you have bought outright – or b) you can get a new handset which is then normally connected with a plan.

Some fixed-term plans will actually offer a particular mobile phone (often one they want to get rid of!) as part of the monthly price that they are charging. Eg. You’ll not be paying an additional fee fort the actual handset.  However, with other mobile phone plans you can actually choose which ever mobile phone you want, but will then be paying that of in monthly installments in addition to the actual monthly cost of the plan. So be mindful of this. In either case however there is generally an exit fee of sorts if you want to leave the plan early which will require you to pay out the remaining cost of the phone.

If you do decide to get a phone with a plan you are generally looking at between $5 and $45 per month for the phone repayment (over a 24 month mobile contract).  If however you would prefer to buy a phone outright, prices range from under $90, to well over $1000.

I’d also suggest looking at second hand mobile phones too as you can often find yourself a good deal.  Ebay.com.au often has some really good deals, but buyer beware as you are generally purchasing a second hand mobile so do no expect warranties and great after sale service.

There also many marketing ploys to be aware of. $0* phones, Free Facebook with Mobile internet plans… etc. And while these can often be great mobile deals  you need to read the fine print.  The * in ‘free’ generally means you’re tied to a 12-24 month contract. And the phone cost is factored in to you repayments. And ‘Free Facebook Access’ may be great, but you still have to pay extra each month to have mobile broadband / internet access.  So be sure you can afford this.

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Prepaid Mobile Phones

Prepaid mobile is great for those of you who are either on a tight budget, addicted to your mobile and want a ‘safety net’, or simply wish to have absolute control over how much you spend and when you spend it (parents – this is a great option for your children!).

With prepaid you generally buy a starter kit from the provider which sometimes comes with a handset (often not though).

This kit then gives you access to the phone network and a set amount of call credits / dollars to spend. When your credit runs out, you can simply ‘recharge’ your call credits and make more calls! Easy.

So it goes with out saying that a prepaid option gives you complete control over call expenses. However be careful using any number that cost you too much (international / sms competitions / directory connect etc.  as you could end using up all your credit faster than you realise.

If you’re not sure how much you are going to use your phone (especially if this is your first) then using a prepaid plan initially will you get a rough measure on how much you will be using your phone, and perhaps what level of postpaid contract plan you may decide to sign up for in the future.

Prepaid tends to be the cheaper option if you don’t make many calls as you do not have any monthly contract commitment, handset repayments etc.

Often parents buy a prepaid phone and starter kit for their children, but are concerned that they may run out of credit while they are out and not be able to contact anyone in an emergency. One benefit of all plans in Australia is that even if you don’t have any call credits remaining, you can still use the phone to make 000 calls and will be able to receive calls.

Another point to remember is that the call credits you buy may expire after a specified period (depends on the network). So be sure to not buy too many credits if you’re not going to use the phone enough in the required time.

Some providers will allow you to carry over unused credits so never be afraid to ask when your speaking with them.

It’s also important to investigate how and where you are able to ‘recharge’ your prepaid phone call credits. In most cases you can recharge at multiple points including supermarkets, ATM’s, 7-11 convenience stores, newsagents, etc. But if you’re not sure, ask the question.

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Postpaid Mobile Phone Plans

Mobile phone contracts or plans are fixed term and range from one month to 24 months (or longer) and have a minimum monthly service charge. The minimum charge usually includes a certain amount of calls. Often these plans also include a handset, but not always so pays to read the fine print.

One of the key benefits of a Postpaid plan is that they tend to have cheaper call rates (when compared to prepay plans).

One thing to consider with a prepaid plan is that costs can easily get out of control so this is very important to understand if you are on a tight budget. One option to look into if you like the idea of a postpaid plan is call capping or mobile cap plans. Most providers now offer capped plans where you nominate the maximum you are able to afford each month.

Also available now are what are called unlimited capped plans. In these cases you are charged a higher monthly fee but this allows unlimited usage. Be careful though as the terms of service of each carrier can very greatly, and while you think you may be getting unlimited ‘everything’ many additional services such as SMS and Data are still charged at a premium.

One down side of the fixed term mobile contracts is that often, if you want to quit the plan early you will have to pay ‘exit fees’ or penalties.

One common mistake that people make when choosing a prepaid plan is that if they overestimate their mobile usage, they don’t use up the included call value each month. On the other side, if they underestimate their usage, they end up paying higher per-minute rates, and may have been better off on a unlimited cap plan or similar. One trick is to get a prepaid plan initially to measure actual usage requirements before selecting a contract plan.

Some things to consider before signing up to a long-term mobile phone plan:

  • Think about the length of commitment and minimum total costs involved.
  • Find out if a handset/phone is included in the initial cost or if it is an extra fee.
  • Understand the costs and penalties involved in paying the plan out early.
  • Ask if you can change to a higher, or lower, usage plan at any stage if required.

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Types of Mobile Phone Plans in Australia.

In Australia the major providers offer two main mobile phone plan options; Contract (or Postpay) mobile phone plans, and Prepaid mobile.

What the right mobile plan for you is will largely depend on your personal circumstances because they each come with positives and negatives in terms of potential costs, contract terms, and call charges.

One of the first questions to ask is “Do I want to commit to monthly mobile bills and a contract, or would I prefer to pay as I go?”

If you’re happy with a contract and a monthly bill, then a postpaid plan (contract) can be a good option, however if you’d prefer the flexibility of only paying for what you use when you can afford it, then a prepaid plan could be better as you will not be burdened with a monthly bill regardless of how much, or little, you use the phone.

Each however have negatives and things to be aware of, so for more information

follow the links below:

- Postpaid Mobile Contracts
- Prepaid Mobile

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