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Which is better, using a mobile phone with a pre-paid card, system or signing up for a mobile plan or even a contract? There is no right or wrong answer to this question. It all depends on who is using the phone and how it is going to be used. If you want to determine what is the best choice for you take a look at the distinguishing features of prepaid and mobile phone plans in the paragraphs that follow.
First let’s look at how pre-paid mobiles work:
With pre-paid you normally have to buy a starter kit. The kit will give you a phone number, access to the network and a certain amount of credit for calls. When you use up the call credits you will have to “recharge” your account in order to be able to make further calls.
Pre-paid is a pay as you go system. The so-called; big advantage of pre-paid is that you can tightly control your expenditures. If you are on a limited budget and can’t afford to have a big bill come out of the blue at the end of the month, then pre-paid will let you make the calls that you can afford. Pre-paid is also considered a good choice if the phone is for youngsters.
If you have not used mobile phones before, then starting off with pre-paid might give you a good idea of how much and when you will use your phone. This knowledge will be very important later on, when and if you decide to sign up for a mobile phone plan. The more accurately you match your calling patterns with the various mobile phone plans on offer, the more
Money you can save.
In general, pre-paid can be the cheapest option for people who do not make many mobile calls. If you only want to have a handset so that you can receive calls or use it in an emergency, then using prepaid is a good option. Even if you run out of credit you can still receive calls and dial emergency services. The length of time you can receive calls after the expiry of your credit varies from provider to provider, so check with them to find out.
There is no bill with pre-paid mobiles, but you can find out how much credit you have left usually by making a toll free number. Some providers will also send you messages or beeps when your credit is getting low. Call credits usually expire after a certain time, so you have to “use them or lose them.” Ask your provider how long the credits last and if they can be carried over beyond the deadline.
One disadvantage with pre-paid is that international roaming is sometimes not be available, though Vodaphone plans to introduce it soon. If you want to make calls when you are overseas then one option, if you have a GSM phone, is to buy a pre-paid SIM when you get to your destination. You will have a different number, but you will be able to make calls.
If you want to move to another network, you may have to pay what amounts to an exit fee (a fee for removing SIM security locks). Different networks have different policies — check before you buy. Another feature to check is what method is used for recharging the credits. Currently providers offer phone, web-based, ATM or refills at retail outlets (service stations and convenience stores).
Now let’s look at the main features of mobile phone plans and mobile phone contracts
Mobile plans are usually fixed term contracts normally ranging from 12 to 24 months and occasionally longer. These contracts can fix a minimum monthly service charge, which usually includes a certain value of calls. The cost of your handset may also be included in the monthly fee.
Mobile phone plans tend to have cheaper call rates, especially for medium and higher usage plans. However, these costs can sometimes escalate out of control — something to consider if you’re on a tight budget. Some services offer bill capping (where you nominate a maximum monthly spend), although the minimum cap we found is still quite high.
In addition, capping can sometimes lead to huge bills, as the user starts to change their call patterns, not knowing that the large amount of extra calls are not covered by the cap.
Also…There may be exit fees if you want to leave the plan before the term of the contract. Find out how much they are.
You will usually get a certain amount of calling credits with your plan or mobile contract. If you do not make many calls then these credits can’t be used. On the other hand, if you underestimate how many calls you will make and choose a plan with insufficient call credits, then you will end up paying high per-minute costs for the extra calls.
That is why it is important to know your calling habits before you sign a contact. A prior “test” with a pre-paid can give you an indication or help you to accurately know how many calls you would make with a mobile phone plan or contract.
Before signing up to a long-term plan, think about the length of the contract and minimum total costs; find out if a phone is included in the cost or if you have to pay an extra charge. Find out the costs and penalties involved in leaving the plan early, and whether you can change to a higher- or lower-usage plan at any point.
Your mobile phone savings friend,
About The Author
* John Bertone is a mobile phone specialist that'll show you how to find the cheapest mobile phone deals on the market! His NEW special report called: Mobile Phone Secrets Revealed will guide you on how to save an absolute fortune on your mobile phone costs! To find out more visit: www.MobilePhoneSecrets.com.au