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Published on February 16th, 2013 | by Guest Writer

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A Great PAYG Deal?

If you’re not doing PAYG, you might actually be losing money. No idea what PAYG means? PAYG stands for pay as you go, and it’s the alternative to having an expensive monthly mobile phone contract. And it’s an option that not enough people are taking advantage of. Of course, it has it’s disadvantages, but current market research suggests that heavy phone users are more likely to save money using PAYG than by using a contract. You might be wondering how exactly that works, so read on to see if you’re paying too much…

Not the Traditional Choice…

It used to be that monthly contracts were the way to go. Because phone companies offered free or steeply discounted handsets with a signed contract, customers could save money on the price of the phone itself. And then, contracts often also added in bonuses such as free minutes or free messaging. But that’s beginning to change. As phone companies are looking to boost lagging profits and the cost of new handsets is sky rocketing, more and more companies are locking customers into two year contracts with huge monthly costs. And if you’re the kind of user who frequently phones, messages or uses data, then there’s a good chance that you could be saving money by simply buying your own device and using a SIM card.

What’s the Down Side?

The negative side of this is that of course you do need to buy your own mobile phone, which means the initial outlay is quite high. And then, you may need to worry about topping up your phone credit, rather than just letting charges be added to your bill. So you might need to be a little better prepared to have a PAYG plan, but it could mean big savings.

What’s the Up Side?

The plus side of this is that you will own your phone, there will be no expensive contract ending fee should you decide to change companies, and that you’ll be paying for services that you’re actually using. The problem with the long contracts that many companies are forcing you to sign is that the little bit of “extra” money that’s added onto your contract every month to offset the price of the phone that you got for next to nothing is now adding up to more than the cost of the phone itself. This means that in the end you’re paying for far more than your phone is worth, and making the initial big investment of buying your own hand set may actually be worth it.

Are There Restrictions?

Nope, that’s the great thing. You want an iPhone PAYG deal? No problem. PAYG works just as well for smart phones and phones with data connections as it did for older phones ten years ago. Sure, you may need to be a little more alert, all that internet connecting can suck your credit down faster than you think, but you can get any kind of phone on PAYG. It might not be the right solution for everyone, but it is something that’s worth looking into. Do the math. You could end up saving yourself some cash…

Phil Turner has looked at iPhone PAYG deals and is tempted to buy one for his daughter.

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