Four Things You Should Know Before Signing Up for Wireless
Contract phone plans can offer a variety of benfits vs. pre-paid options.
If you’re moving to the US and do not have credit history, or you’re building your credit, you will need to choose between a contract plan, which bills you after your usage for the month, and a prepaid/pay-as-you-go plan. For a typical wireless plan, your carrier may ask you to put up a deposit of $500-1,000 if you don’t have credit, or good credit. While pay-as-you-go is convenient for those who can’t put down a deposit, if you can stomach the deposit, contract plans have the following advantages:
Build credit history
After 2-3 years of timely payments (set your bill on auto-pay and review the bills), you can likely graduate to a no-deposit situation. Having a good credit history will also assist you with securing apartment rentals and qualifying for credit card offers with lucrative sign-up bonuses.
Get better deals
In general, carriers reserve their best deals for contract plan customers with credit history. For Verizon, at press time, its prepaid customers pay $75 monthly for unlimited data while contract customers plans start at $40 monthly. For T-Mobile, at press time, its prepaid customers only get 100MB of roaming for $55 plan, whereas its contract customers get unlimited data when overseas, albeit at 2G speed.
Compare roaming policies
It’s easy to only focus on the per month fee or device cost, but if you expect to travel or live abroad (summer internship in Paris? spring break in Canada?), check out the carrier's’ data roaming options. For example; T-Mobile offers free roaming with their standard plans (click here for list of countries). Verizon will charge a flat $10 per 24-hour cycle ($5 in Canada & Mexico), and you get to use your data allowance overseas. For a 10-day trip, the difference can be $100 + taxes on your monthly bill.
Roaming policies and Coverage Areas are important factors to consider.
Understanding Coverage Areas
If you live in a large metropolitan area most cell phone providers will offer equal coverage and price will most likely be the deciding factor in your selection. Keep in mind though that if you plan to travel away from higher populated areas, not all carriers provide equal coverage. If possible you will want to keep your future plans in mind and select a carrier with coverage available at decent speeds nationwide.
Selecting a wireless plan that best fits your budget and needs is an important step towards building your financial history and becoming self-sufficient. Always, do your research and make sure that you are chooseing the best options for your particular situation.
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