The average person spends £60 per month on a mobile contract here in the UK. This usually involves unlimited minutes, texts and an 8-12 GB of data. The contract comes with a “free” phone which is, of course, factored into the price of a 2-year contract. Let’s see how much a classic phone deal costs, which comes with the most popular phone:
10GB data, unlimited minutes & texts, 2GB international data,
iPhone 7 256 GB storage,
Upfront cost: £120
Monthly cost: £63 (£31.50 first 6 months)
2-year total cost: £1443 or £60.12 per month
In fact, it is a little higher because “Each April your bundle price will increase by an amount equal to the RPI rate”.
Typical answers I get when I ask people why they are on this deal go like these:
- “60 pounds is not much money plus I’m getting a brand new phone every 2 years”
- “Phones are crap, I only trust my iPhone…”
- “I couldn’t live without my iPhone and Vodafone has the best network out there”
This is considered normal and since everyone has signed up for a £60 iPhone plan, why should you not be… Right?
NO! This is not Right! You should not own a £799 phone and pay £60 each month because you are in fact overpaying for a mobile contract thanks to marketing and peer pressure. The device looks very cool when showing off to friends and the unlimited data plan makes you never worry about scrolling infinite auto-play videos.
The automatic deductions from the bank account (Direct Debit) do a perfect job of quietly taking the monthly payments as if the money was never there. But it’s not only the device that eats our income. It’s the minutes/data plan which comes with it too. Not to mention the legal part that binds us for 2 years until the end of the contract. This is why it’s called a contract after all.
Why waste so much money to be able to surf and talk when we can do it for much less?
Here is the magic part: How about we try something different. We will call it the Ultimate Kickass Plan, U-K-P!
Let’s try buying a phone that equally serves our needs and get on a sim-only plan using a cashback website.
What is a cashback website?
If you’ve never heard about it before it’s a website like Topcashback or Quidco through which you can buy stuff and get money back. Simple as that. No hidden asterisks, no catches. You can buy anything from hoovers to your cat insurance.
Here’s a screenshot of my recent earnings:
As you can see, I have managed to get £75.69 for free just by searching what I want through this website. After finding the product, I get redirected to the actual seller’s website where I can purchase the product as I would normally do.
And here is another screenshot of the actual mobile plans I’m talking about.
I don’t know how Topcashback or Quidco make money but I don’t really care as long as I get paid. Let’s pick a generous deal that offers cashback:
12GB of data, 5000 minutes, 5000 texts sim only:
Upfront cost: £0
Monthly cost: £12
Phone cost: £200 (£209 with 4.6% cashback discount)
2-year Total cost: £445.25 or 18.55 per month
WOW! That makes the first plan 324% more expensive. In other words, we are paying less than 1/3rd of the most popular consumer plan!
I actually found out that I don’t really need 12GB of data and I’m just using less than 4GB. This is probably because I use the WiFi for faster connectivity wherever possible and because I don’t watch more than 20 videos on 4G per day. Not bad, given that this brings the cost down to ~£16 monthly or £388 for the 24-month period.
I was very skeptical when signing up with a smaller company like Talkmobile at first, but it turns out they’re a great company. Their online support is excellent as well as their mobile coverage throughout the UK.
Which phone?
I picked the Huawei Honor 7, a phone that has served me very well during the past 1.5 years. I take a lot of photos and its 20 MP camera makes sure the pixels are displayed perfectly. By the way, an iPhone 7 uses a 12 MP camera. I’m not against an iPhone, I believe it’s a great phone, just insanely overpriced.
Here’s a picture using only 15MP, shot with Honor 7 at Green park, London (click for full resolution).
Apart from the high-quality camera and a fingerprint sensor, it’s quite fast when running multiple applications at the same time and its battery (3100 mAh) -which has always been a problem for me in the past- lasts for 1.5 days heavy usage.
The only drawback is that it comes with only 16 or 64GB of internal memory, but you can upgrade if needed using a micro-SD card. Here’s a Sandisk 64GB selling for £17.39 on Amazon, enough to store more than 5 hours of Full HD video!
But since most of the people’s space is taken by thousands of photos and videos here’s a little trick. I use Google Photos to upload ALL my photos for FREE. I had my doubts initially, but it’s another free service with no catch. Even better, the photos organize themselves in albums like magic, and you can also search through your photos… for example “cat” or “beach”! I was very excited initially, now I’ve got used to it…
For £200, if that’s not called a deal, then I don’t know what is. VMall used to send you a £40 e-voucher upon registration; I got my Honor 7 for £175.
So to recap
Ultimate Kickass Plan
12GB data
5000 mins (84 hours!)
5000 texts
Honor 7
£445 (2 years)
£18.55 (monthly)
Consumer popular plan
10GB data
Unlimited mins
Unlimited texts
iPhone 7
£1443 (2 years)
£60.12 (monthly)
That’s a £1000 difference worth considering… That’s £5,000 in 10 years or ~£7000 when invested! In other words, if you switch to the UKP you get a new small car as a gift :)
Even if you have a remaining contract, you can still call your company, find out what the termination fee is, do the math and leave. The earlier you do it the better.
I’m looking forward to reading about how everyone has left their expensive mobile contract to join the UKP movement…!
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2 thoughts on “The True Cost of your Mobile Contract”
I also trust Huawei they make really good phones. Good post!
Thanks Christina! Honor has never let me down – especially the 20MP camera…
I don’t trust Huawei, Michael