Better to buy a phone handset outright on 0% interest or commit to a 24m contract?

Wilde1

Hi,

I am looking at upgrading my phone, I am currently on a sim only contract.

I want to upgrade to the iPhone 6s and am looking at the cheapest options to do so.
For marginal difference in price I can either get a 16gb handset on contract with O2 for 24 months, or I can buy the 64gb handset outright using a 32 month 0% money transfer card and continue with a sim only contract.

Is it a good idea to be using a money transfer for this, rather than getting a contract with a phone company?

I like the flexibility buying outright gives you but I don't want to harm my credit rating.

Any advice would be greatly appreciated!

Thank you!

anotheruser

Don't know what a money transfer card, but if it's a bit like acredit card, so long as you pay it off before the 0% finishes, you'll be fine.

I will use O2 as an example, forgetting their special deals on trade in early, double data and whatnot.
Based on this tarriff: 16GB iPhone 6S / 500Mb Data / 500 Mins

PAY MONTHLY:
Upfront Cost: £10
On-Going Monthly Cost: (£37 * 24 months) £888
TOTAL: £898 over 24 months (equiv of £37.40 per month).

SIM ONLY:
Upfront Cost: £489
On-Going Monthly Cost: (£12.50 * 24 months) £300
TOTAL: £789 over 24 months (equiv of £32.80 per month).
Re-Sell Value after 24 months: £150 (approximate)
£789 - £150 = £639

Extra pointers:

• The iPhone 6S will be replaced later this year with the iPhone 7.
  
  
• The iPhone 6S cost is an average from Amazon sellers.
  
  
• The Sim only contract is only 12 months. Potentially you are free to swap to a cheaper deal after that.
  
  
• The estimation of £150 for the phone is fairly accurate. Apple products keep their value, but considering it'll be a couple of years old and newer iPhones will be out, it's a good estimation.
  
  
• If you're going to sell the phone, keep the box, headphones, all manuals and such safe and nice. Mine go in the loft so when re-selling, it looks like new.
  
  
• Even if you don't sell the phone after the 24 months, it's still slightly cheaper. The toughest for most people is getting the large upfront cost.

It's easy to compare.
Look on the website of the operator you're wanting to join, and fine the equivelent deals on the Pay Monthly section and Sim Only section.

Again, to get a realistic outlook, forget special deals as most of these only last for 3/6/12 months.

SuperAllyB

anotheruser wrote: »

Don't know what a money transfer card, but if it's a bit like acredit card, so long as you pay it off before the 0% finishes, you'll be fine.

I will use O2 as an example, forgetting their special deals on trade in early, double data and whatnot.
Based on this tarriff: 16GB iPhone 6S / 500Mb Data / 500 Mins

PAY MONTHLY:
Upfront Cost: £10
On-Going Monthly Cost: (£37 * 24 months) £888
TOTAL: £898 over 24 months (equiv of £37.40 per month).

SIM ONLY:
Upfront Cost: £489
On-Going Monthly Cost: (£12.50 * 24 months) £300
TOTAL: £789 over 24 months (equiv of £32.80 per month).
Re-Sell Value after 24 months: £150 (approximate)
£789 - £150 = £639

Extra pointers:

• The iPhone 6S will be replaced later this year with the iPhone 7.
  
  
• The iPhone 6S cost is an average from Amazon sellers.
  
  
• The Sim only contract is only 12 months. Potentially you are free to swap to a cheaper deal after that.
  
  
• The estimation of £150 for the phone is fairly accurate. Apple products keep their value, but considering it'll be a couple of years old and newer iPhones will be out, it's a good estimation.
  
  
• If you're going to sell the phone, keep the box, headphones, all manuals and such safe and nice. Mine go in the loft so when re-selling, it looks like new.
  
  
• Even if you don't sell the phone after the 24 months, it's still slightly cheaper. The toughest for most people is getting the large upfront cost.

It's easy to compare.
Look on the website of the operator you're wanting to join, and fine the equivelent deals on the Pay Monthly section and Sim Only section.

Again, to get a realistic outlook, forget special deals as most of these only last for 3/6/12 months.

Why have you only included a re-sell value in one scenario?

anotheruser

SuperAllyB wrote: »

Why have you only included a re-sell value in one scenario?

Because it's harder to sell a contract phone as it's liklely it'll be locked to a certain network.

Plus, after the first 12 months, I'd look at selling the phone anyway. With a contract phone, that can't really be done.

Regardless of that, it's still cheaper with a sim only.

mobilejunkie

Untrue. I usually sell my contract phones the day I receive them and they are never unlocked. My deals are cheaper than any sim only ones as well. But then I never go direct to the network.

Wilde1

Thanks guys, I went for the option of buying it outright using a 32 month 0% interest card, and a £8pm sim only with Vodafone which is a great deal as 500mins, Unlimited texts and 10gb data.
Works out around the same price but no commitment to contract (past 12months), got the 64gb instead of the 16gb, and also used student discount with Apple so got headphones worth £100+ for free which I will sell! So I think I've got a good deal..!

patricia1066

Wilde1 wrote: »

Thanks guys, I went for the option of buying it outright using a 32 month 0% interest card, and a £8pm sim only with Vodafone which is a great deal as 500mins, Unlimited texts and 10gb data.
Works out around the same price but no commitment to contract (past 12months), got the 64gb instead of the 16gb, and also used student discount with Apple so got headphones worth £100+ for free which I will sell! So I think I've got a good deal..!

The Vodafone deal is £23 direct from Vodafone. How did you get the £8 sim only deal?

Neil49

patricia1066 wrote: »

The Vodafone deal is £23 direct from Vodafone. How did you get the £8 sim only deal?

Good question! All of a sudden I am interested.

Browntoa

I always buy my own phone outright , then sim only contracts

patricia1066

It's a sim only 12 month redemption deal with

http://www.e2save.com/sim-only/12-month-contracts

anotheruser

Which then reverts back to £23 after the 12 months.

I barely use all my internet as it is so saving the £2 isn't worth the hassle of having to mess about and loose my current contract, which isn't available anymore.