The Basics of Monthly Mobile Phone Contracts

Never far from their toys


Thinking of buying the latest top of the range mobile phone? Contract or pay monthly phone deals is one of the most innovative ways to go about it. In this deal, one pays a minimum monthly fee, and in return they get a free phone, as well as a monthly allowance of texts, data and minutes. If one exceeds this minimum, their amount will increase. The monthly contract phones have several advantages. The biggest is the fact that they come with free phones. There are a wide variety of subsidized phones from which one can choose, from the simplest to the latest and most expensive fancy phones. These monthly contracts provide good value. When one pays in advance for a fixed amount of data, minutes and texts, it is much cheaper than paying directly on a usage basis. Monthly contracts are also hassle free. The bills are paid by direct debit, and the user does not have to worry about being cut because they forgot to top up their credit.


Mobile phones today have become somewhat of a necessity, and are more than the luxury items they were considered to be years ago. Most people find themselves needing to use their phones on a regular basis. Heavy users of their phones will be better off choosing a monthly contract. However, for those who use less than £10 per month, the pay as you go option is perhaps the most ideal way to go. The latest phones are a status symbol among friends. However, they are also very expensive costing hundreds of pounds at a time. Instead of paying such large amounts up front, getting one through a monthly contract deal is the better alternative, with only either no amount required upfront or a small fee depending on the phone and the carrier.

The way monthly contracts work is that one will be given an option of 12, 18 0r 24 monthly contracts. For most carriers, the 12 month contracts give the option of changing the duration of the contract or the phone. Typically, the longer the contract, the cheaper the monthly bills are. However, to take put a monthly contract, one has to be over the age of 18 and complete a credit check. After that, all what remains is the payment of a fixed amount every month, and in return one gets a phone of their choice and a fixed number of minutes, texts and data to use.

Just like any other contract type, the choice of carrier is a huge part of the choice. It is advisable to shop around looking for the best deal and price plan. Most carriers sell monthly contracts, although there are some that have traditionally only had pay as you go or SIM only packages. Still, given the duration of the contract, choosing the right carrier is extremely important. Make the wrong choice and one will be stuck with an unpleasant deal for two years. One should try to find a deal that matches their monthly usage. The cost of usage over the allocated number of minutes, texts and data is billed and can accumulate.


Choosing an Appropriate Mobile Phone Deal



The first step in choosing the best mobile phone deal is the choice of one of the three options available to UK subscribers.

  • The pay as you go option, or PAYG, is for light users that spend around about £10 every month
  • The monthly pay contract is suitable for those who wish to buy a pricey top of the range handset
  • The SIM only contract is suitable for the heavy users who already own a handset

Strictly speaking, there is no better alternative than the other. The choice of deal will ultimately depend on one’s situation and the amount of money they are willing, or normally spend on their phone every month. Here is an overview of the different options;

Pay as you go

With the pay as you go option, there is no need for a monthly fee. Also, one does not have to sign for any direct debit agreements. The pay as you go deal involves one paying for their mobile phone usage through the normal topping up of the credit in advance. After using up all the topped up credit, one will not be able to use their phones again until they top up. This option is ideal for those light users that spend between £10 and £15 every month.

Mobile phone contract

The traditional mobile phone contract will be spread over 12, 18 or 24 month periods. In this deal, one pays a fixed monthly fee by direct debit. With this, they get a free handset, normally subsidized, and a fixed number of minutes, texts and data. Typically, one has to commit to the length of the contract. Depending on the type of phone one wants with the deal, there might be need for an upfront fee. This deal is often helpful for those who desire the very latest smartphones but are not able to pay a large upfront amount. It is also suitable for those who run up large monthly phone bills regularly.

The third option is SIM only, where one gets a new SIM card, but not a new handset. There is still the typical allowance of calls, texts and data, all in different amounts and prices for one to choose depending on their usage every month. The monthly cost will, however, often be lower than it would for the regular monthly pay contracts. Another advantage of SIM only contracts is that unlike the lengthy contract mobile phone deals, the SIM only will typically only tie one down for a month.

In addition to the choice of contract, there are other factors to consider when buying a handset. For instance, many networks will typically offer mobile phone insurance with the phone deal. While these are necessary, they are often relatively pricey. Before taking out the insurance, one should find out whether their home insurance already covers the handset. Even after deciding on the type of deal to choose, do not simply settle on the first offer. Shop around a little and see what the other service providers have to offer.