Close to a quarter of people with a monthly contract for their mobile phone are potentially overpaying, according to research. Also make sure you're on the best phone tariff by checking out our guide.
The research by comparison site uSwitch also found almost a third of people on contracts have no idea when their contract ends, making it even more likely they’ll continue to pay more than they should.
With most contracts ending after 24 months, those who haven’t changed their deal or switched to a different network are likely to still be paying for the handset they got two years previously. With the rise in SIM-only deals and smaller companies drastically cutting how much you can pay each month, it pays to pay attention to your bill - and the length of your contract.
So what questions should you ask yourself before you opt for a new deal?
1. How many minutes, texts and data do you need?
Before you start looking for a new deal, consider your current mobile phone usage. Whether you’re on pay-as-you-go, a contract or a SIM-only deal, ask your current network provider or check your bill to find out how many minutes you use, how many texts you send and how much data you use on average each month.
If you tend to exceed any of these, then you need to consider a deal that offers you a higher monthly allowance. However, depending on the costs, and by how much you exceed your limit, opting for a more generous inclusive deal might not actually work out cheaper. Be prepared to do your sums.
If you consistently under use your allowance, then you might save money by opting for a lower tariff or a pay-as-you-go deal. Again, you’ll need to work out how much you’re likely to spend each month if you weren’t on an inclusive deal – different networks will list their prices online, so use these to compare the cost with your monthly contract bill.
Online tool, BillMonitor.com, will analyse your bills to find the best tariffs for your average useage.
MobilePhoneChecker.co.uk is another mobile comparison tool to help you find the best deal.
2. What network coverage can you get?
Do you have coverage problems and any network preference? If you are considering moving to a different network provider, then it’s worth checking what the coverage is like in your area. Ask other people what networks they use and find out if they’ve suffered any issues with coverage.
People are also increasingly opting for mobile phone with 4G – or fourth generation – services. These allow you to connect faster to the web via a mobile network.
But there’s no point paying more for 4G if you can’t get it where you most frequently use your phone.
Telecoms regulator Ofcom has a website - checker.ofcom.org.uk – which allows you to check mobile phone coverage by postcode. It also offers a similar service via a free downloadable app for Apple and Android devices.
3. Do you need a new handset?
The latest handsets tend to be offered on more expensive monthly contracts. In fact, it can be substantially more expensive to buy the phone included in your contract.
Instead, it’s often cheaper to buy the handset upfront. If you can’t afford such a large cost you could consider using an interest free purchase credit card and paying it back in full before the 0% period ends.
Better yet, if your existing handset is perfectly good, keep it!
If these aren’t an option and you decide to get your new handset through a contract, then make sure you compare the total cost of all the options available to you.
4. Do you need a contract?
If you’re not buying a phone and contract together, traditional contracts rarely represent the best value.
You can instead buy a SIM-only deal which can drastically cut your monthly payments. These are, as the name suggests, deals that don’t include payments for a handset.
5. Could you try a new network?
If you’ve been with one of the main networks, it might be time for a change. There are dozens of new networks including Giffgaff, The People’s Operator and Tesco Mobile. These networks “piggyback” on the signal of the main four - EE, O2, Vodafone and Three - but charge a lot less. It’s simple to move your number over once you switch, you simply ask for a PAC (Porting Authorisation Code) from your old network and your new network will do the rest.
You’ll need to make sure your phone is unlocked. If it’s not, then this is free to do if your contract has finished.
6. What operating platform is right for you?
In addition to handsets, you can now choose from a number of operating platforms that your mobile will operate on. This is the interface of the phone and offers various features that can also be synced with your desktop - calendars, diaries and applications, for example.
Whether you want Google’s Android or Apple’s iOS will probably depend on the other technology you use. A third option is a Windows Phone, though there are fewer apps available.
7. Could you bundle with other services?
We’ve moved on from just bundling phone, broadband and TV services together. Now, some of the most competitive mobile phone contracts are from the likes of BT or Sky. It’s worth looking to see what discount you can get for adding a SIM to your existing packages.
However, a downside to consider is you’re tying yourself into one provider for yet another service. If you want to switch any of these to a different company you’ll need to switch everything.
8. Do you really need freebies?
Many providers will offer free gifts in order to tempt you to sign up – but it’s important to look beyond the freebies to see if the deal really is right for you.
EE offers free BT Sport, for example, while O2 has its popular freebies app O2 Priority. These can be welcome additions, but shouldn’t be the sole reason for picking a network.
9. Can you cut your commitment?
Opting for a long contract term could see you offered a cheaper monthly rate, but this could be a false economy, especially with 24 months the standard length. New handsets and contract offers come out all the time, so making a long-term commitment to a contract could see you lose out down the line. If you think your situation could change in the short-term you can even get 30-day rolling contracts, though these do cost more.
10. Are happy to haggle?
Despite all the above ways to save, you could still get a better deal by telling your existing network you want to leave - and seeing what it says.
It may offer you further discounts on your monthly tariff, or even give you a new phone for free.
Whatever it offers, it’s worth totalling up the total cost over the whole contract versus buying the phone on its own and going SIM-only.
11. One last tip - check the small print
Check the small print and don’t be afraid to ask questions or for clarification before siging up for a deal. Ask about the returns policy, what happens when a phone breaks, whether you can cancel your contract penalty free further down the line, and whether prices can rise mid-contract.