Cell Phone Payment Plans Are Awful.

Remember the days when you could drive down to your local cell phone store, flip open a few phones, play with features, and walk out with a FREE cell phone?

I do. And after this year, I miss them.

Here’s our story on how a bucket of clams cost us hundreds of dollars, what we learned about ourselves… and the way we pay for our cell phones.

Remember the days when you could drive down to your local cell phone store, flip open a few phones, play with features, and walk out with a FREE cell phone?

The days when your device wasn’t inferior to its competitors. Sure, maybe one offered more ringtones than another, or the phone came with a full QWERTY keyboard rather than T9 texting, but those were your remarkable differences. Every phone in the store would live for days in between charges with real-world use. You were substantially more likely to break your phone in half than you were to break the screen…even then, the phone may still work if the wires were connected.


Then, on June 29, 2007…


Steve Jobs, Chief Executive Officer of Apple, debuts the iPhone… a $399 touchscreen mobile phone with a built-in iPod, camera, full web browser, and dozens of other features…such as “apps” (whatever the heck those are). Initially, it was regarded as a “very poor cell phone, but the world’s best handheld computer”.

Everybody raced to mimic the iPhone and produce their own products to compete. A frenzy occurred and the cell phone market was officially disrupted in a way that nobody expected.

Personally, I mark 2008 as the day the “free cell phone” died. Prior to the iPhone, you walk out of any cell phone store with a free cell phone (with a two-year contract, of course) that was going to outlive your contract. This made sense because the cell phone provider was able to provide a $269 basic feature phone with the cost built into the contract and come out with a profit once your contract was fulfilled.

However, why would you agree to a free cell phone when you could pay just a little bit of money to get a phone that was literally better in every way?

I sure wouldn’t.

Over the next decade, the price of “smartphones” increased with every new release…with the iPhone X of 2017 debuting at $999 for the basic model. Cell phone providers just can’t subsidize, blur the cost, or assume the risk of a $1,000+ cell phone over the life of a two-year contract. Its bad business and trying to do it would be profit killing. Consumers demand the latest and greatest in everything, for the lowest prices. Cell phones are more agile, present, and depended-upon that anyone could have imagined they’d be a decade ago. The cell phone game has changed, but the cell phone service providers and carriers don’t have nearly as much room for innovation and price adjustment as their technology developing counterparts.

So, like all things in the capitalist society, the increase of cell phones prices must be transferred to the consumers (that’s you, and me). To quote the movie Syrup“Sex is biology. Sex-appeal…is marketing”.

It’s all about how you spin it.


The Spin.


Introduce the latest iteration of the “free” cell phone.

$0 down for 24 months.


Do you know what ELSE requires “$0 – small down payments” for a specified term?

**Clears throat**






…do you see what I’m getting at?

The temptation to have the latest and greatest is always heavy. Marketers do their jobs very well, because we are willing to spend tons of money every single year to buy new phones to do nothing more than scroll down Facebook with.

Not only do we have to have the latest item, but they’ve learned how to coax us into purchasing it TODAY under the agreement that we will be selling our souls for the next two years to have it.

To be fair, your cell phone probably has a 0% interest rate for 24 months regardless of your credit situation (whereas car leases and finance offers typically don’t offer 0% unless you are a top-tier borrower)… but let’s be real, too.

Most people are more likely to keep their car/furniture/appliances for longer than two years, but may get a new cell phone every single year.

I personally keep my cell phones for about 30 months before something happens (damage or personal weakness) and I upgrade to a newer model. Right now, I’m at month 23 on my current phone. But I know many others whose cell phones don’t outlive their payment plans.

Even with the best intentions, sometimes we have to get a new phone sooner than expected. Is it me, or does it feel like each new phone is slightly more breakable than its outgoing model?




Now, I am a fan of 0% interest promotions  for items that you’re going to buy regardless.

For example, my husband and I bought our wedding bands on a zero interest promotion because we already had the full cost of the bands saved up, but wanted a little bit of financial flexibility to help cover unexpected costs behind our wedding. Shortly after we were married, we pay off the bands.

BUT… there’s a stark difference between our cell phones and our wedding bands: We plan to keep our wedding bands indefinitely.

Not the proverbial justification to spend tons of money on a cell phone or car because “oh I’ll keep it till the wheels fall off”, but rather… we understand that our cell phones will be in our possession for many years, but eventually they’ll get replaced. Nature of the product.

In 2015, my iPhone 5S slipped out of my hands and fell on the cement floor of a hardware store. The screen didn’t shatter, but it separated from the computer chips inside. We all know that cell phones have just a couple of buttons and most of its functionality comes from the touchscreen…which now wasn’t operable on my phone. In a pinch, I did a $0 down/24 months offer on a new iPhone.

If you’re married… you know the word “compromise”. You also know that you and your spouse must always have equity in everything, so Jay wasn’t going to let me get away with a cell phone that was effectively 3 models newer than his phone for very long… even if I dropped my phone off the Eiffel Tower.

So, naturally, he soon took advantage of the same $0 down/24 month promotion as me on a different phone.


A Crab, an Oyster, and an iPhone.

This past June, we traveled to Maryland for the LGBTQ+ March on Washington, and the server at my favorite Baltimore seafood restaurant accidentally spilled melted butter on my husband’s cell phone. We didn’t notice any damage for a few days, but by the time we were home in Tennessee… he realized his phone speakers no longer worked properly.

At that time, we owed about $250 on his phone. We explored a repair, but cost just wasn’t worth it. This meant that a new phone was in order, and we had two options.

  1. Pay us the sales tax (based off retail value) on a new phone, plus 24 additional months of payments, and $250 to pay off his current phone.
  2. Pay retail price ($500+) for a cell phone, plus the $250 to pay off his current phone.

He decided to put up with his malfunctioning phone for a few months because we weren’t in-love with the idea of dropping tons of money OR re-financing another phone right in the middle of our debt free journey.






New Season. Same phone.

Then, a close friend upgraded their phone and offered to sell his iPhone 7 Plus to us for his payoff amount (about $130 less than retail). At that time, we owed about $120 on Jay’s buttery device, and he was itching for a phone that worked in the way that God intended.

We agreed to the deal.

Jay sold his butter phone for our $120 payoff, and we bought the new phone in cash. When I went to pay off his old phone, I noticed that I owed about $40 on my own cell phone… so I paid it off, too.


Cue: November 2017


Our next bill (and all future bills) is $52.38 lower than before.

Why? Because we now own both of our phones outright and don’t owe our cell phone provider any phone financing payments.

If something happens to either of our phones, we don’t have to worry about juggling a payoff balance, or freaking out because we owe more on it than we have in our savings account. We don’t have to worry about our phone living until month 25, and by purchasing a pre-owned phone, we didn’t have to pay sales tax against the retail price.

Now my husband won’t have to suffer for nearly five months with a broken cell phone because we can’t “OK” the idea of spending hundreds of dollars to replace it since our payoff for the broken phone is high.

But more important, WE LOWERED OUT CELL PHONE BILL BY $50+ dollars.


What I’ve Learned.

Going forward, we are going to buy all of our phones in cash.  Proverbs 22:7 says that “The rich rule over the poor, and the borrower is slave to the lender” –and boy, did we feel the slave part of that equation… being physically stopped from replacing his phone because we owed so much money on it.

I still plan to take advantage of 0% interest promotions whenever I deem it financially advantageous, but I am going to only do so whenever I’ve got the cash to pay off said 0% loan in full at any point. Maybe this cash is in an investment earning substantially more than 0%. Perhaps it’s in a savings account for a future vacation, or it could simply sitting under my mattress–either way, I’ll physically have the money.


October 2016 (Launch of Man Vs Cash) to Present Day

-Furniture Installment Loan
-Student Loans
-Acura Car Loan
-Credit Card Debt
-Cell Phones

-Honda Car Loan


…on to the next one!


Photo source credits:

Categories Loans & Debt, Major Purchases, My Personal Journey
search previous next tag category expand menu location phone mail time cart zoom edit close