Pre-Paid Cell Phones

Pre-paid cell phones are a good option for people who don’t plan on using their cell phone very often. While they don’t require a long-term contract and monthly bills, they sometimes end up costing more than regular service through a wireless phone company.

How do pre-paid cell phones work?
The pre-paid option allows customers to have cell phone service without signing a long contract. It’s important to know the terms and conditions for the pre-paid company that you choose because each company is different. In general, you purchase a phone and a specific amount of minutes. In order to maintain service, you must keep an active balance of minutes on your phone. Minutes can be purchased over the phone, online, and in many stores.

Advantages to Pre-Paid Plans:

• • No binding contract required
• • No credit check required
• • You pay only for the minutes used
• • No activation fee
• • No added taxes and surcharges
• • No monthly bills
• • No termination fee to end service

Disadvantages to Pre-Paid Plans:

• • Higher per-minute rates than a monthly plan
• • You pay for incoming calls
• • You may be charged for incomplete, busy, and/or unanswered calls
• • You may be charged a daily use fee (ex: $1 each day you use your phone)
• • Purchasing phone features (ringtones, internet, etc) can cost you minutes
• • Your minutes expire after a certain period of time -- If you don’t continually purchase minutes to extend the expiration date, your phone will be deactivated and you could lose your phone number
• • You could run out of credit at a crucial time that you need to make a call

It’s important to have an idea about how often and when you’d like to use your phone. When comparing different companies and plans, consider the following options:

• • Price Per-Minute
• • Expiring Minutes
• • Daily Fees
• • Nights and Weekends Minutes
• • Mobile to Mobile Calls
• • Roaming Charges
• • International Calling

To get more information on prepaid cell phone price comparisons go to:

• • www.myrateplan.com
• • www.getconnected.com
• • www.cnet.com
• • www.wirelessadvisor.com
• • www.phonedog.com

Pre-Paid Cell Phone information complied from Utility Consumers’ Action Network. http://www.ucan.org/