How To Find The Best Smartphone Plan in 2016

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Last Updated: September 6, 2016

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Almost everyone has a smartphone or will have one shortly. Their usefulness is undeniable. This convenience comes at a high cost and multi-year commitment. We examine the major smartphone providers, their wireless plans and costs, to help you make a more educated decision.

Important: As with any mobile wireless plan, you need to ensure you have coverage where you need it. Home, work, play, you need signal otherwise it does not matter what the price is.

Traditionally, smartphone buyers were able to purchase the latest smartphone at a significant discount, often at $199, when they committed to a new 2 year plan with a major wireless carrier like, AT&T, Verizon, or T-Mobile. Times have changed. There are many more options available to smartphone owners.

Consumers can choose no contract smartphone plans or traditional smartphone plan from one of the 4 major carriers. In a previous article, Find the Best No-Contract Smartphone Plans  we examined the best way to save money: No contract smartphone plans, in this article we will examine the more traditional smartphone plan and help you pick the best one. The average consumer spends almost $150 on wireless each and every month. Families spend even more. We cannot do anything about the high cost of wireless taxes that are added onto your bill, but we can save you a significant amount of money. It is surprising that only 1-2% of subscribers switch to other carriers every year.

Company Discounts

Some large companies have negotiated discounts with the large cell phone carriers. All you need is a company email address to obtain this discount. Check with your HR Department to see if your company qualifies. As an example, here is the AT&T Wireless Employee Discount page.

Check and compare coverage using Open Signal.

Major Problems with the Large Carriers

  • Long term 2 year contracts or installment plans
  • Good credit required
  • Subsidized hardware costs mask true pricing
  • Too many complex options and plans
  • Hard to compare costs with competitors
  • Upselling to more data than most need
  • Difficult to assess coverage and performance

Key Factors to Look for in a No Contract Wireless Carrier

Here are the main attributes you need to understand when evaluating a wireless carrier and wireless plan:

  • Price – of course you want to minimize this. You will pay over $1700 over 2 years.
  • Wireless Network – Understand which network works well in your home and area of travel.
  • Minutes – Only purchase as many minutes as you need. Most people are concerned with text and data limits. Did you realize that you can actually make phone calls with your smartphone?
  • Text Messages – Make sure you have enough to cover your needs.
  • Data –Pick a plan that has enough data for your lifestyle.
  • Smartphones – Ensure that your desired phone is available for this carrier.

International – If you travel abroad, does the carrier allow you to use the phone internationally?

Monthly Wireless Data Usage

If you are a current smartphone user, check your bill to see how much data you use every month. Your new plan can be sized to your current usage patterns. According to Nielsen, the average person used 733MB of data in early 2013. Most people paid for a lot more, approximately 2GB. In 2016, the average mobile customer used over 3GB of data. Over 1/3 of users used 50% or less of their data plan’s allotment.

In 2015, 28% of AT&T's customers paid an overage fee, and 20% of Verizon's did. The wireless carriers force you to select data plans with specific limits, making it easy to over buy. (If you need 600MB, they might force you to purchase 1000MB)

Did you know you can call up your wireless company and ask nicely for more data? You might get an extra 1GB!

We have been updating this comparison over the years and have seen the cost of data fall every year. Verizon charged $80 in 2014 for 500MB of data, in 2016 you could get 4GB of data.

Reduce Data Use

Apps use a lot of data.  Check data usage under Settings - Cellular for iOS, or Data Usage on Android. Here are some ways to reduce this:

  • Disable Autoplay for videos in Facebook and Twitter
  • Enable Travel mode in Snapchat
  • Google Chrome has a data saver mode, while Safari does not

Keep in mind that most people are connected to Wi-Fi to perform data intensive operations.  Roughly 70% of mobile device Internet traffic is now carried by Wi-Fi.

Connect to Wi- Fi to Save on data costs

  • Connect at Home
  • Connect at Work
  • Use free Wi-Fi at restaurant like McDonalds, Starbucks, etc
  • Use the free Wi-Fi that your cell phone carrier supports (IE AT&T has attwifi)
  • Use the free Wi-Fi that your broadband provider has (IE Comcast has Xfinity)

If you are new to smartphones, consider these guidelines on monthly usage:

  • Email, Social Networking, News, Web Browsing – 1GB per month
  • Plus music streaming or downloading, sharing photos, download apps – 3GB per month
  • Plus movies, video streaming – Unlimited per month

These are some rough figures to help you select the appropriate plan. Keep in mind that most unlimited plans slow down your data transfers to a snail’s pace, after you pass a preset limit.

AT&T has a Data calculator that helps you figure out your needs. Verizon and T-Mobile have one also. It is funny that they don’t agree when checking our data use.

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    Learn: No-Contract Plans, Unlocked Smartphones

    Perfect for T-Mobile, StraightTalk or AT&T Wireless. Add a line or replace and older phone.

    Choosing the right plan for you is time consuming and can also be a hassle. We've done the research and you may save over $1,000 each year! Be sure to check out our no-contract Smartphone plan article: How to Find the Best No Contract Smartphone Plans where we compare all of the major network carriers. Check out our How to Buy an Unlocked iPhone article to learn what it means to have an "Unlocked" Smartphone.

    About Apple iPhone 6 Plus:

    The Apple iPhone 6 Plus comes with a new faster Apple A8 processor (ironically made by Samsung) and runs on iOS 9. It has a a longer, larger 5.5" Retina display with a fingerprint-resistant oleophobic coating. Cnet calls the redesign "sharp, slim, and feather-light."

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    Reviews:
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    • iOS 10
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    • Bluetooth 4.0
    • 802.11a/b/g/n/ac Wi-Fi
    • NFC
    • upto 24 hr talk time on 3G, upto 16 days standby
    • 6.07 ounces

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    • $45 a month buys you unlimited talk, text and 5GB high speed data with no contract or credit check
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More Like This

Smartphone Hardware

Not every phone will be available on every network. You need to decide on the handset that you will be using. The first choice is Android or iOS, after that, most wireless carriers have the same popular smartphones. Shoppers need to understand that they will be stuck with the smartphone for 2 years. Saving $50 or $100 over a 2 year span, and getting stuck with an inferior phone is not very wise.

The major wireless companies attract shoppers with their promises of the latest smartphone for $199 or less. Instead of making consumers pay the full price of a smartphone up front ($400 - $800), they give the shopper a discount and make them pay more each month. You are making a 2 year commitment when you accept this initial discount. If you break the agreement, you will have to pay a hefty early termination fee. You can purchase the phone up front, but few people opt for this expensive arrangement.

A recent push is to switch to the installment plan like AT&T Next or Verizon Edge, where you divide a phone's payments into 24 monthly payments.

Many carriers will charge a one time activation fee when you purchase a new smartphone. Look for sales where they waive this activation fee. Sales tax is charged at the time of sale based on the full price of the smartphone, not its actual selling price.

Does the carrier allow you to bring your own phone? Most of the ones that allow you to do this support GSM technology that is used by the AT&T and T-Mobile wireless networks. Those which run on Sprint or Verizon networks usually require you to buy a new smartphone. Consider this before you buy an unlocked or used phone off eBay or Craigslist.

Does the company have a good record of rolling out the latest and greatest hardware? After you finish your 2 year commitment, there will surely be a new phone that you lust for. Is there a good trade in policy or sell back program?

Mobile Insurance

The wireless companies are good selling you insurance on your smartphone. Because these mobile devices get damaged or lost frequently, they can charge from $7 to $10 a month based on your fear. A third party like SquareTrade will sell you an insurance policy for less. Only go this route if you have a history of mishaps with your smartphone.

T-Mobile

TMobile Logo

T-Mobile is one of the major four wireless carriers in the United States. They have a wide range of smartphones available for purchase. T-Mobile has recently increased its popularity with a variant of the traditional smartphone sales model. You can either pay for the phone completely up front, or pay a down payment (many smartphones are $0 down), finance the device, and commit to a clearly defined monthly fee. If you cancel service, the remaining balance becomes due immediately.

They are expanding their LTE network and adding to their spectrum. Wide band LTE will be deployed in some areas, enhancing performance.

In August 2016, T-Mobile introduced the new T-Mobile One and One Plus plans with 'unlimited data'. Each Plan has a lot of gotchas, depending on what type of media is consumed.  Also the speeds slows to a crawl after 26GB of use every month.

T-Mobile One Plan Hidden Fine Print Limitations

 

In November 2015, T-Mobile added the Binge On program where they allow an unlimited amount of video from certain sites. It starts with 24 sites including Netflix, Hulu, and ESPN. YouTube was added in March 2016. The resolution of the video is downgraded to DVD quality. Only on certain plans. At the same time, they increased the cost of the unlimited data plan by $15/month.

In September 2015, with the iPhone 6S and 6S Plus launch, T-Mobile started rolling out Extended Range LTE. This added more frequency bands to T-Mobile (700Mhz), enabling better reception inside buildings. This support will be slowly rolled out Nationwide. Their goal was to have 350 markets upgraded by the end of 2015. Smartphones need to add support of this frequency.

December 2014 They added: Data Stash, which allows you to rollover unused 4GB LTE data to the next month. Only included with some Simple Choice plans.

Note that they slow your tethering speeds once you pass 7GB per month.

T-Mobile operates a GSM network, allowing you to purchase an unlocked phone and use it on their network. All you need to do is buy their SIM starter kit

T-Mobile June 2016 Data plan costs

Coverage - Good to very good depending on your area. Check their coverage maps. Their high speed LTE Network is still being rolled out.

Best Individual Plan - http://www.t-mobile.com/cell-phone-plans/individual.html#lshop_plans_1

T-Mobile has an excellent $75 per month Simple Choice Plan with unlimited talk and text, and 6GB of data. If you use more than you are allotted, data speeds will simply be slowed, no overage charge.

Their $99 per month plan gives you unlimited high speed data.

Best Family Plan – T-Mobile often times, has discounted family plans, so check their website. Often they charge less with each additional line.

A family of four with smartphones, 6GB’s of high speed data each, unlimited talk/text would pay a very good$160 per month. Sometimes discounted to $120/month.

Smartphone selection – Very good. From the latest iPhones, Samsung Galaxy Notes, Galaxy S through basic Android smartphones. T-Mobile had some devices, which were not available from the other major providers. Very good incentives to switch.

Bring your device - You can buy an unlocked GSM iPhone or Android Smartphone elsewhere and then buy their SIM starter kit to take advantage of this plan.

T-Mobile is best when:

  • You are on a budget
  • You want to use an existing unlocked GSM phone
  • You are a Heavy Data User
  • You need unlimited talk and text
  • Sharing a plan
  • There is Good Coverage in your local area. Especially LTE.

AT&T Wireless

AT&T logo

AT&T Wireless has a variety of plans, which makes it much more difficult to comparison shop. They have individual plans as well as family oriented mobile share data plans. They also have a Next Plan which allows you to get a new smartphone every year or year and a half, but is costly. Each of these plans has its advantages and disadvantages. AT&T has a reasonable amount of coverage nationwide. They are one of the most reliable wireless networks to be on.

AT&T Wireless in 2016 added an Unlimited plan for those customers who also pay for one of its DirecTV or U-verse video plans.  This has no teethering and slows speeds after 22GB of monthly use.

att july 7 2016

*We do not recommend getting shared data plans with less than 1GB-2GB per line as overages will occur more often.

Coverage - Good to very good depending on your area. Check their coverage maps

Best Individual Plan - $75/mo Unlimited Talk and Text and 5GB Data; $115/mo for 15GB. This is a lot more expensive than T-Mobile. If you go over your data allotment, it is an expensive $15 per GB.

Best Family Plan – A family of four can get unlimited talk and text and 15GB to share for $200. 20GB to share only costs $40 more. Specials from time to time can drop prices.

Smartphone Selection - Excellent. From the latest iPhones, Samsung Galaxy Note, Galaxy S through basic Android smartphones.

Bring your device -Free SIM Cards for GSM phones including iPhones that are unlocked. LTE support is also available.

Note: There have been changes from last year that benefit users. You can actually get more data for the same prices that were in place around 2014.

AT&T is best when:

  • Speed
  • Network Coverage
  • Smartphone versatility

Verizon Wireless

verizon-logo

Verizon Wireless has the known best coverage nationwide making them one of the most reliable networks. In survey after survey, they are usually rated number one. This top rating does come at a cost. Verizon does not offer unlimited data like some of the cheaper options described here. They also have an Edge Plan which allows you to get a new smartphone every year or year and a half, but is costly. Each of these plans has its advantages and disadvantages. Many of their phones utilize CDMA technology limiting them from begin used internationally. Some of their newer phones are World ready.

Verizon updated plan prices with more data but higher prices in July 2016. This ended data overage fees.

  • A new My Verizon app helps you manage your data
  • Roll over Data
  • Free data access to go90 entertainment
  • Safety Mode lets you stay connected at a reduced speed until you buy more 4G data or hit your next billing cycle. Included with XL plans and optional for other plans.
  • Usage in Mexico and Canada is included with XL plans and optional for other plans. New plan also added rollover data at that time

Existing subscribers can switch to the new plans at any time.

Verizon1

Verizon2

*We do not recommend getting shared data plans with less than 1GB-2GB per line as overages will occur more often.

Coverage – Very good to excellent depending on your area. Check their coverage maps

XLTE - In late May of 2014, Verison unveiled "XLTE", hyped and advertised as another LTE service capable of delivering faster speeds and better coverage. In reality, XLTE is just the name Verizon is giving the frequencies added to the spectrum that their LTE network runs on. Currently, Verizon's massive LTE network runs on the 700MHZ band, which is great for traveling long distance but running out of room for new users quickly. Rolling out in the next quarter, Verizon's XLTE will provide LTE internet on the AWS spectrum they purchased in 2012, providing a lot more bandwidth and breathing room for LTE users. XLTE will work on newer devices and users can expect to see their internet speeds increase slightly with fewer incidents of bandwidth congestion (when mobile internet service becomes noticeably slower in areas where many people are using the same LTE network). In the future they will support carrier aggregation allowing them to improve performance.

Smartphones that will support XLTE include:

  • iPhone 6S/6/5s
  • Samsung Galaxy S7/S6
  • Motorolla Moto X
  • LG G4/G5

Best Individual Plan - $55 per month for unlimited talk, text, and 2GB data; $70/month for 4GB data. This reflects a drop from last year's prices.

Best Family Plan - $150 per month for 4 smartphones along with 8GB of shared data. Pricier than AT&T.

Smartphone Selection - Excellent. From iPhones, Samsung Galaxy Notes, Galaxy S through basic Android smartphones. Verizon has their own Droid line of smartphones.

Bring your device - You need to buy a phone or mobile hotspot from Verizon. Other GSM phones will not work. Some used Smartphones from eBay may work if they are not banned.

Verizon is best when:

  • Reliability – the top rated network
  • Speed with high speed LTE available
  • Network Coverage that is arguably the best
  • Costs are not the number one factor

sprint

Sprint is one of the underdogs in the smartphone race. In a recent comparison they ranked last among the major carriers. They were acquired by Softbank Japan, which should help them in the future. They market an Unlimited plan with no mention of throttling, but you will have to watch out for their off-network roaming usage limits. The off-network roaming usage allotment is small and can easily be used up in a few days.

Sprint has several different plans making it very confusing to navigate their website. It is hard to recommend them because of this. Look at Boost Mobile, their prepaid division instead, if you must use their network or are on a budget. T-Mobile is priced in the same ballpark, and much more liked.

In the near future, they are rolling out Sprint Spark Triband LTE, which will give them higher performance and better coverage. This will be featured on their 800 MHz, 1.9 GHz, and 2.5 GHz bands. Some day they will be able to achieve maximum peak speeds of 1.3 Gbps.

In August 2016, Sprint introduced the new Unlimited Freedom and Freedom Premium plans with 'unlimited data'. Each Plan has a lot of fine print, depending on what type of media is consumed.  Also the speeds slows to a crawl after 23GB of use every month.

Sprint Unlimited Plan September 2016

Other Sprint Plans

Sprint July 2016

*We do not recommend getting shared data plans with less than 1GB-2GB per line as overages will occur more often.

Coverage - Fair to very good depending on your area. Check their coverage maps

Best Individual Plan - $50 per month for unlimited talk, text, and 3GB high speed web. Instead of having two tiers the way they did last year, there is instead only One simple choice for individual plans.

Family Plan - $140 per month for unlimited talk, text, and 12 GB data serving 4 people. There are now several more options for the amounts of data that are available.

Smartphone Selection – Very Good. From the latest iPhones, Samsung Galaxy Notes, Galaxy S through basic Android smartphones.

Bring your device - You need to buy a phone or mobile hotspot from Sprint. Other GSM phones will not work. Some used Smartphones from eBay may work if they are not banned.

Sprint is best when:

  • You want Unlimited Data without throttling
  • You have reliable Coverage
  • You can accept the limited Smartphone Selection

US Cellular

US Cellular is a popular carrier that is not available nationwide. If you live in the areas, more rural, that they serve, then definitely give them consideration. Their 2GB Shared Data Plan with Unlimited Talk and Text $75 a month, not exactly a lot of data.

Conclusion

In conclusion, the consumer has a lot of control over cost with every Smartphone plan. You can switch carriers or Smartphones almost at any time. Review the details above + select the one that fits your needs. We recommend you take the time to understand your situation and pick the one best for you. Take Price, Coverage, Smartphone Selection, and monthly Bandwidth Allotment into consideration.

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