For as long as I can remember I’ve always struggled with my cell phone bill. My relationship with my (various) phone companies was splotchy at best. And I’d tried them all: AT&T, Verizon, Sprint, T-Mobile. Sometimes my bill would go up a little bit. Sometimes it would go down. But it was generally somewhere between $100 - $160 per month. This payment also included whatever the newest iPhone was at the moment as well as a large or unlimited data plan (10GB or more). Somewhere along the way I’d convinced myself that a new phone was necessary every year (because the iPhone is consistently revolutionary) and that I needed an unlimited capacity of data as well as storage on my device.
It wasn’t until I really began systematically optimizing my life (in terms of happiness-derived as well as expenses) that I started to question my phone bill. There it was, every month, like clockwork. My bill had ballooned to $206 which, to be fair, included my fiancé’s line as well. My share of that bill came out to be $107. The plan was with AT&T and included 10GB of shared data and a litany of extra charges: Mobile Insurance Premium, Mobile Protection Pack - Support, Administrative Fees, Federal Universal Service Charge, Property Tax Allotment, Regulatory Cost Recovery Charge, Telecom Relay Service Fund, 911 Service Fee, County Sales Tax, NC State Sales Tax, and NC State Telecommunications Sales Tax. Those extra charges amounted to $18.39/month.
Aside: Reading a typical phone bill is exhausting and tricky and completely part of the reason that people don’t consider changing their service. It’s a hassle and it’s designed to be a hassle. It’s designed to be confusing. As a general rule, when something is dense and confusing and it deals with your finances, you’re probably getting ripped off. In fact, the whole financial industry is designed to keep people confused and fearful in an attempt to make their services useful. And a lot of it is confusing and complex, but most of it doesn’t have to be that way. Anyways. I digress.
So I had examined my bill and determined that enough is enough. Armed with a decade of outrage, I sought out a new solution and found that there are a number of opportunities to NOT pay $100+ for your monthly phone bill. The two services I strongly considered were Google FI and Republic Wireless, eventually choosing Republic Wireless. Below, I’ll share with you the journey (and slight hassle) of switching from AT&T to Republic Wireless in hopes that it will streamline your decision making and answer a few key questions about how to make a switch like this (which can seem like a daunting task).
STEP ONE: GET RIGHT WITH AT&T
The major carriers (and it seems most cell companies in general) don’t use contracts anymore. This is good news because it means you can walk away from your provider without much adieu. However, there was that small detail about the balance of my phone. This is another sneaky way the phone companies ‘trap’ you into upgrading year-after-year to the latest and greatest iteration of marketing muscle. You don’t feel the financial impact of buying a new phone, because you don’t have a lump sum payment to make. They just roll it into your bill as a monthly charge via an installment plan. My particular plan was a 24 month agreement to pay off my iPhone 7 at a rate of $35.42/month AKA $850. When a new phone comes out after about 11 of those payments have been processed, they will “buy” your phone back from you (at a greatly discounted rate) and apply that credit to your new (and more expensive) balance. (I just looked up the release date and price of the recently released iPhone X only to find a new article about a new release this fall from Apple that includes three or four new phones launching at the same time. The cycle continues.) The phones get more and more expensive and your monthly payment plans creep up along with it, but you barely notice because it’s buried in that complex 5-page bill they send you every month. Sure, the total number fluctuates, but it’s just a few dollars, so why bother looking any further, right? Silver lining: AT&T doesn’t charge interest on these payments (but your phone carrier might — I’d look).
The point here is: I had a balance left on my iPhone 7 and if I was going to pull off this switch in the most effective manner, I would need to pay it off. I went to a store and paid it off, which only took about five minutes, but it did cost me $354.11. I think this is a good gut check and realization that these phones are EXPENSIVE AS SHIT and represent major purchases in our lives! Think about it. What was the last thing you spent $354 on? A plane ticket? A new TV? And this was less than half of the cost of my already-outdated iPhone 7. Yeesh. But I paid it and it was done. That felt nice. I also felt a sinking feeling in my stomach as I realized that if I broke this delicate thing in the next week or so, I’d be out several hundred dollars on resale value. Gulp.
STEP TWO: SET UP MY ACCOUNT AND PURCHASE PHONE FROM REPUBLIC WIRELESS
So the thing about Republic (and also Google FI) is that they don’t support the iPhone. (Here is a list of phones they do support. Additionally, you can BYOP.) Granted, that is a big hurdle. And that fact alone kept me passively repeating the cycle outlined above for years. How could I give up my iPhone? The apps. The camera. It integrates with my computer and Apple TV. I’m used to it. I get it and it gets me. Valid points, kind of. I think the emotional impact of “losing” your iPhone is pretty high for most people. We are creatures of habit and we will bite if you dare threaten our delicate ecosystem. But here’s the thing: I’m in the photo/video business. I see new cameras come and go every year, just like phones. And I’ve had the realization that technology has really leveled the playing field. IE: If you’re not a good camera operator, it’s not because your camera isn’t good. They’re all GOOD. And so it is with cell phones these days. If you removed your experience with iOS and the brilliant marketing of Apple and just judged the phones based on their features, there really isn’t much a difference. Armed with that knowledge, I was ready to take that terrifying step into the world of the Android-based-un-iPhone-cellular-wasteland, which is actually rather pleasant.
Republic’s plans are based on a flat rate of $15 per line and then $5 for every GB of data you’ll need. I set up my plan for 2GBs. (They are never any overage fees, by the way. They allow you the option of adding an additional gig if you are running low. If you don’t add any data, they just throttle your service outside of WiFi.) This plan amounts to a staggering monthly bill of $28.06. $25 for the plan + data and $3.06 for various fees (as opposed to the $18.39 I was paying in fees every month to AT&T).
Then I had to select my phone. After about 30 minutes looking at online reviews and tutorial videos, I decided on the Moto X4. They have a similar financing option where I could just tack on the phone bill as an installment, but THEY DO CHARGE INTEREST, so I opted to buy the phone, out-right. It ran me $382.98. Pow. Right in the kisser! Once my order was placed, they mailed me the phone and sim card. I had to install the card and set the phone up and went through the rigmarole of linking all of my accounts and such. Interesting Note: Every single app I used on my iPhone was available in the Google Play Store. Essentially, I have set my phone up the same way I had set up my iPhone. Who would have thought?!
STEP THREE: PORT MY NUMBER AND OFFICIALLY KICK AT&T TO THE CURB
RW has a step-by-step guide on their website to port your number. You enter your provider’s details (account # and password) and they do the dirty work. You don’t have to go into a store. You don’t have to talk to anyone. It did take about 24 hours, but my number ported and the line dropped off my AT&T bill. Voila!
STEP FOUR: SELL MY IPHONE
I mentioned earlier that most folks (myself included) just sell their phone to their provider when a new option comes out and roll the difference into their new and improved monthly installment plan. There is another way, though. You can opt to sell the phone yourself, privately, and then bring that (larger) stack of cash to them and put that towards your new phone. This is basically what I’ve done here, except that I went ahead and bought the new phone to save on finance charges and to keep my monthly plan nice and low. To recap: I paid $354 to pay off my iPhone and then paid $382 to buy my Moto X4. Total spent: $736. Now, I won’t get that price for my iPhone 7, but I will get somewhere between $400 - $500. (Full disclosure: I’m still in the process of selling the phone. I will update this when it has sold.) Lets say that number is $450. At that point, I’m at a net loss of $286. I will be saving $79/month with my new plan. So it will take about 3.6 months for this to all shake out. After that, though, I’m profiting $79/month for as long as I keep this phone. Savings per year (after the phone exchanges shake out): $948. Hey, that’s almost enough to buy a new iPhone XI (coming soon)!
Something I have found really interesting about the whole cell phone process is how quickly these devices depreciate. We don't really notice because we have just accepted that we will be paying a monthly fee to have a phone forever (which sounds a lot like a car payment). But the truth is, these things are EXPENSIVE and they plummet in price every year (or sooner) when the new one(s) come out. For example, my iPhone 7 cost $850 initially (in September of 2016). We'll see what I can sell it for, but lets assume that's $450. Over the course of 1.5 years, the device has depreciated 47%. That's 31% per year. Apply that math to a vehicle you bought for $20,000. That would mean that 1.5 years after purchase, your vehicle would be worth $10,600. I know we're talking about $100s instead of $1000s, but it's still worth considering. And the price of phones are just getting higher, meaning the depreciation rate is becoming more steep.
I’m not debating that the iPhone is a great phone. I’d even go so far as to say it may be the best phone. And it’s been that way for a decade. It is also fair to say that there are a lot of other phones out there that are comparable. With that in mind, I would recommend the slight hassle detailed above to anyone looking to save some serious cash. Aside from writing about this process, I’ve got about three hours invested. I think most people would trade three hours for an extra $1,000 every year. Then again, how much is the comfort of iOS worth to YOU?