July 15, 2005, Newsletter Issue #4: Cellphone.Lifetips.com Brings Your Tip of the Week!

Tip of the Week

Cell Phone Contracts, Read the Fine Print

Always, always, always read the fine print. All carriers require contracts to be signed with the purchase of cell phones that they offer free of charge or with any type of rebate that drastically reduces the cost of the cell phone. The commitment is usually 1-2 years with 2 years being the norm. The consumer must make a wise decision when choosing a plan and selecting features because, after the first 30-90 days (depending on the carrier), any changes made to the contract will cause the contract start date to begin again, extending the contract.

Another way consumers can lured into extended contracts is through offers such as "new every two" or "phone upgrade" plans. Many carriers now offer their customers the option to get a new phone every 18-24 months. The new phone has a price, however, which includes renewing the contract for another 1-2 years. Therefore, if the consumer is looking to for a new carrier, it is not in their best interest to accept the new phone. Plus, most carriers will provide new customers with a new phone eventually anyway. In other words, if a consumer is planning on switching carriers, it is probably in their best interest to get a new phone through the new carrier.

Keep in mind that every contract signed should be taken very seriously. The contract will have all of the information the consumer needs to know regarding contract extensions, early termination, and fees. Most carriers charge $150-$250 as an early termination fee so, unless the user is really unhappy with the service, it might be wise to stick out the contract before cancelling. Also, the consumer might look into purchasing their phone outright because early termination fees may not apply or might be less if the phone was not free or reduced.

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