Guide to Mobile Phone Contracts

Mobile Phone Contracts
Whether you’re looking to get hold of the latest smartphone or simply want a good deal on calls, texts and internet usage, mobile contracts are an excellent option.
For a monthly fee, a contract allows you to get a great phone without having to shell out loads of cash on buying one outright. At the same time, you can get a good deal on data usage.
Sounds amazing, right? But what can prove difficult is finding a contract deal that suits your needs. The market is full of deals and handsets from different networks. In this guide, we’ll take you through the things you should consider when choosing a mobile contract.
What is a mobile contract?
When taking out a mobile contract, you’ll agree to pay a monthly bill across a fixed period of time. Most contracts last for 12 or 24 months, giving you a handset and set amount of calls, texts and internet data.
Contracts are an alternative to pay-as-you-go, where you buy the handset outright and pay for data when it’s needed. They’re great if you want to choose a monthly plan that suits your needs and requirements, and you’ll no longer worry your credit running out.
If you do ever go over your allowance, your network operator will just add charges to your bill at the end of the month. Most networks also offer the option to purchase additional texts, calls and internet data should you go over your limit.
Free versus premium handset
While the general premise of a mobile contract is the same, prices vary whether a handset is budget or high-end. If you’re not too fussed about brand and just want a decent phone that works, you won’t need to pay an upfront cost.
However, if you’re looking for a popular model like the Apple iPhone, you’ll likely need to pay towards it. On top of a one-off fee, the monthly contract price could also be more expensive than other models.
Should you want a known smartphone model but aren’t too concerned about it being the latest iteration, upfront prices may be cheaper. Depending on network, the handset might even be free.
Sim-only contract
There are also contracts for people who’d rather buy their own phone. Sim-only deals do exactly what they say on the tin: you just pay for a sim card to put into your phone and get a monthly allowance of calls, texts and internet. These are an excellent option if you’re more concerned about usage rather than phone.
Business versus personal contract
If you’re a business owner, you can get B2B mobile phone contracts. The general perception is that corporate contracts are expensive, but you’ll be surprised to find some affordable deals that suit the requirements of your business and team. What’s more, these are usually flexible and vary based on business size. Most major mobile operators offer business contracts alongside personal contracts.
Free gifts
With many contract deals, you can can get a free gift as part of your deal. That can be everything from accessories, to headphones and to games consoles. This is an attractive option in the run-up to Christmas or a birthday.
A lot of network operators run loyalty schemes, too. For example, EE provides cinema tickets to contract customers, while Three has its own rewards app where you can get discounts on everything from eating out to shopping.
Roaming costs
Going on holiday and plan on using your smartphone? You can easily be bit by roaming charges. A good phone contract will usually offer a roaming allowance, and if you go over this, it’ll usually be capped to help you avoid unwanted costs. In the EU, roaming doesn’t cost a penny. But this will vary by country and region.
Increased charges
Before signing up to a contract, it’s worth reading the operator’s terms and conditions. Many companies are able to increase monthly tariffs based on the Retail Prices Index, which measures inflation. This is the case with most major mobile networks. If you’re ever hit by charges exceeding the RPI, you’re within your rights to leave your contract.
Credit checks
Phones aren’t exactly cheap, and contracts are basically mini loans. So when you sign up for a contract, you’ll go through a credit check. It helps to know your credit score as you look for deals. If it’s lower than expected, pay-as-you-go is a good option.
While brands, prices and data allowance are important things to consider when looking for a contract, network coverage is also crucial. Based on where you live, signal strength will vary per mobile network. And so-called “piggyback” networks like Tesco Mobile will use the signal of more established providers, O2 in this case. Ofcom has a signal checker to help you determine network choice.
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