Quick Guide to Mobile Phone Contracts

Whether it's your first time applying for a phone contract or you're in the process of upgrading to another plan, it pays to know what you're getting into. Like with any type of phone deals, phone contracts come with advantages and disadvantages. It is imperative for consumers to weigh both sides against each before signing any dotted line. To help you get a clearer picture of how phone contracts work, here is a quick guide for you:

  • What are phone contracts?
  • Phone contracts as opposed to pay as you go are the type of phone deals that hook customers to a lengthy contract. In the UK, the typical contract lasts 24 months. When you opt for a phone contract, you have the advantage of choosing your own handset alongside your phone bundle which you can tailor according to your typical usage of calls, texts and data per month.

    More and more providers are also currently offering customers free gifts as part of the plan to serve as incentive or lure for them to sign up. Free gifts come in the form of other electronic devices such as laptops, game consoles, tablets and more.

  • How much does it cost?
  • Phone contracts cost vary from plan to plan and it mainly depends on two factors. One is the handset and the other is your phone tariff. In other words, the more high end or costly your handset choice, the higher your fixed monthly fee will be. The same is true with your phone tariff. If you choose a tariff that includes generous allowances for inclusive minutes, texts and data, the higher your fixed monthly fee will be.

    The monthly cost may also shoot up in the event that you go beyond your phone tariff allowance. The trick, therefore, to getting the right plan is to ensure that you know your typical monthly usage then look for the perfect phone tariff match.

  • Who is it for?
  • If you're a heavy mobile phone user and you want to get your hands on the latest handset but has no cash to pay for it upfront, a phone contract is for you. The phone contract will subsidize the cost of the handset over the course of the contract letting you enjoy the handset that you want without breaking the bank. Just remember though to pick a handset and a plan that you can afford. Remember that typical phone contracts last for 24 months. You don't want to delay or miss a payment. Otherwise, you will put your credit score in a bad spot.

  • What are the requirements?
  • When applying for a phone contract, major providers will only require the most basic requirements. You must be of legal age, at least 18 years old or above. You must be a resident in the UK and you must provide proof of steady income. Having a good credit is an advantage especially since major providers favor such customers. In case you get refused a phone contract because of bad credit, there are cheaper alternative such as Pay As You Go or Sim only contract. Click here for more info on these types of deals.

  • Should you go for it?
  • While phone contracts may be advantages for many, it isn't always the best option for everyone. In order to know if it's the right option for you, you need to go back to what you need. Assess your typical phone service usage and scout the market for a deal that matches your needs. Your budget is another consideration. The trick is to stick with what you can afford to avoid financial complications later on.