Prepaid Wireless Phones: A Good Deal?

Category: Mobile , Wireless

Verizon, AT&T and other mobile phone providers are offering pre-paid cell phone service with pay-as-you-go billing. If you like the idea of NOT having a long-term contract, and you don't use a cell phone all that much, a pre-paid mobile phone plan could be a good option. But first you'll have to sort through all the confusing plans and offers...

Prepaid Wireless: Confusing on Purpose?

Prepaid wireless is a way to keep things relatively simple. It works just like rent: you pay for a month's worth of use in advance, and if you don't pay you get kicked out almost immediately. There are no heart-stopping surprises at the end of the month, when you learn that you (or someone else) ran up a four-figure tab. With a prepaid wireless plan, you pay for a certain number of minutes, texts, or data in advance, at a certain rate. When you run out, you have to buy more. That's simple, honest, and true. But of course, phone companies make less money when things are simple. Here's how your seemingly simple prepaid mobile phone bill can get complicated.

First, there's the "use it or lose it" aspect of the bundle of minutes and/or data you buy at the start of each month. Again, this works just like rent; you pay $X for the ability to use an apartment for a month, but it's up to you how much time you actually spend in the apartment. That sounds reasonable, but it isn't with phone service. With rent, the landlord gets the same profit no matter how much or little you use the apartment. But phone companies make more profit when you don't use all your prepaid minutes. That 7 cents a minute bargain becomes 14 cents if you use only half of your prepaid minutes.

Prepaid Cellular Service Plans

Phone companies want you to buy more minutes and data than you will actually use, and so they make their pricing plans complex. Here are some examples, from several companies offering prepaid cell phone services.

Comparing Prepaid Wireless Plans

AT&T's prepaid wireless, formerly known as GoPhone, is now branded AT&T PREPAID. It might have been better named GoAway because the pricing plans are so complex they actually discourage people from buying. In fact, AT&T deliberately makes it difficult to find out what it costs. For some reason, they force you to compare the specs of various phones, then they ask you to "enter your ZIP Code so we can show you the best offers available in your area." It doesn't get any less simple than that.

I'll save you the trouble of drilling down into the geo-spatial specifics. AT&T offers a $65/month "unlimited" talk/text/data plan, which actually has quite a few limits. For starters, your data speed is limited to maximum of 3Mbps (and a maximum of 1.5Mbps for video content). After 22GB of data usage, AT&T will slow your data speeds to the point where you'd enjoy watching paint dry. There's a $45 for 6GB plan, but if you exceed that cap, you're throttled to 128Kbps (dialup speed) for the rest of the month. The cheapest $30/month plan gives you unlimited talk and text. But if you have a smartphone, you'll have to buy a monthly data plan ($5 per 250MB) to use web, email and apps.

Verizon prepaid wireless has four pricing tiers. For $40/month, you get unlimited talk/text, the ability to make a mobile hotspot, and your first 3GB of data at high speed. Thereafter, you're limited to 128Kbps. You won't be watching any cat videos at that glacial download speed. Verizon may also "prioritize your data behind other customers during times/places of network congestion." Which other customers? They don't say, but one can assume it's those customers who pay the most. There's a $50 for 7GB plan, and a $60 for 10GB plan, both with the same throttling and prioritizing caveats as the 3GB plan. If you want an unlimited plan, that costs $80/month, but with no mobile hotspot option. (Isn't that a limit?) There is a "Basic Phone Plan" which gives you unlimited talk and text (but no data) for $30/month. If you have a good old-fashioned "dumb phone" this would be the best choice.

Net10 is a bit simpler, but not by much. If all you need is talk time, you can prepay $20 for 200 minutes, $30 for 300 minutes, $60 for 900 minutes or $100 for 1500 minutes per month. If you buy larger chunks, the minutes are cheaper and won't expire as soon. For example, if you buy 200 minutes for $20, they expire in 30 days. 600 minutes will cost $45, and they expire in 60 days. A block of 1500 minutes for $100 is the best deal (6.7 cents/minute), and gives you 180 days to use them. But none of these plans lets you simply buy a chunk of minutes and use them whenever you like, without worrying about them expiring.

If you want data for your smartphone, Net10 has you covered. You can purchase 2GB for $35, 4GB for $40, or 8GB for $50. Net10 calls them all "unlimited" plans, but if you exceed those caps, you are limited to "2G" download speeds. Good for checking email, but not much else.

You may not have heard of Net10, but Tracfone is one of the best known names in prepaid wireless. The companies are owned by the same corporation, but they offer completely different sets of prepaid calling plans. At the entry level is the 90 minutes Pay As You Go Plan for $9.99/month, which gives you 30 service days to use those minutes. There's a bewildering array of Pay As You Go options, with 90-day plans that offer discounts for auto-refills, all the way up to $200/year for 4500 minutes and 365 service days.

Smartphone plans start at just $15/month, for 200 minutes, 500 texts, and 500MB of data with 30 service days. For $35/month, you get 750 minutes, 1000 texts, and 1GB of data with 60 service days. There are 90-day plans with more data, 365-day plans, some with auto-refill, and some without. Figuring out how many minutes, texts, service days, and data you'll need requires a bit of math, some hair pulling and a little fortune telling.

You can also shop around for prepaid wireless service from other providers. Over the years, lots of readers here have mentioned Consumer Cellular for their low-cost, no-contract plans. If your usage is minimal or for emergencies only, the Billed Per Use plan is the cheapest. You pay $10/month plus 25 cents per minute used. Beyond that, there is the 250 minutes/month plan for $15, 1500 minutes for $20/month, and unlimited minutes for $30/month. These are talk-only plans, with no texting or web data.

A Consumer Cellular "Connect Plan" gives you 300 texts and 30MB of web data for $2.50/month. You could use 30MB of data in 30 seconds online, so that seems like a strange offering. More reasonable data plans include the 500MB for $10/month (still barely useful), the 1.5GB for $20/month, 3GB for $30/month, and 5GB for $40/month. All but the first plan come with unlimited texting.

Some Tips to Help You Decide

Prepaid cell phones are great if you don't use your mobile phone that much. They simplify the process of owning and using a cell phone by allowing you to buy the phone that you want and prepay for minutes and/or data that you will be using during the upcoming weeks. You don't need to have a credit card, you don't have to sign a contract and you can cancel your relationship with the company at any time. It can be a good deal if you want to give a cell phone to a child or senior who will only need it on an occasional basis. However, if you use your prepaid cell phone a lot during a month you will have to frequently load your phone with more minutes.

Keep in mind -- since prepaid minutes are generally more expensive than contract cell phone minutes, you may rack up a larger monthly bill using your prepaid cell phone than if you had a contract cell phone plan that offers you unlimited minutes.

When shopping for a cell phone service package you need to determine what is going to be better for the amount of time you spend on your cell phone. People who use their cell phones infrequently, or who just want a cell phone in case of an emergency, are generally better off using a prepaid cell phone, while people who spend a lot of time on their cell phones are better off signing up for a regular cell phone contract.

Here's my advice... talk to friends or neighbors in your area who have cell phones, and find out which carrier has the best signal and coverage in the locations where you plan to use the cell phone. It's not uncommon for phones from one carrier to work great in a certain location, while another carrier has a weak signal or none at all. Then use the information above to compare the pre-paid plans offered by the cellular companies that have good service in your area. Try a pre-paid cell phone for a month or two, and if you find you're using it more than you anticipated, upgrading to a service contract with a set monthly fee may make sense for you.

Do you have something to say about prepaid wireless phone service? Post your comment or question below...

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Most recent comments on "Prepaid Wireless Phones: A Good Deal?"

(See all 43 comments for this article.)

Posted by:

15 Aug 2017

We had T-Mobile pay as you go when we still had a landline. For $200 per year, we each had 1000 minutes. Didn't need data. Pre-paid for a year earned us gold status with extra minutes and rollover. Every so often the hubby would need extra minutes so a year might cost us $250 for 2 phones and 2 lines. I acually still had unused minutes on my phone when we cut our landline and went totally mobile/smartphones. Unfortuantely, I lost those minutes in the switch, but the pay as you go service served us well for over 7 years. BTW, still will T-Mo.

Posted by:

Martin W.
15 Aug 2017

I have two TracFones, one a smartphone and the other a dumbphone. I buy a $20 card for each once every three months. That's 60 minutes and 90 days for $20. However, the smartphone is a triple minutes for life phone, so I get 180 min./3 months. The dumbphone is a double minutes for life, plus there are bonus codes you can find online. I also end up with 180 min./3 months there. Since the minutes roll over, I currently (after a few years use) have about a day and a half of use stored on the smartphone and two and a half days stored on the dumbphone. (But will I ever use that time?)

Posted by:

K Saul
15 Aug 2017

If you don't need internet service on your 'phone, take a look at I've used them for years. You pre-pay, but that never expires. Also (the main reason for using this service and hence the lack of internet or picture sharing) they have the cheapest ever overseas rates and have never applied roaming charges. I always have a tablet to hand for internet use, so this mobile service has served me very well and I highly recommend it.

Posted by:

15 Aug 2017

Need just a phone for emergencies? Page Plus Cellular. $10 for 120 days or 100 minutes. That's $30 a YEAR! Uses Verizon's network.

Posted by:

Dave Hascall
16 Aug 2017

Total Wireless, a TracFone branch, uses Verizon. #35 unlimited Talk and Text and 5 Gb of data. I love it.

Posted by:

16 Aug 2017

Bob, you might want to check your info on Tracfone.

For non smart phone and light use they seem to be the best. There annual plan is 100.00 for 400 minutes. Any minutes left at year end will carry over if you by another 400 minutes for 100.00.

That amounts to 8.34 per month to have a mobile phone which is as cheap as it gets. Also they supplied my flip phone for free. I don't think they are still giving away free phones; but they have phones for sale that are less then 25.00.

Posted by:

16 Aug 2017

CharlesH "The money you save will be your own." :)

I used Tracfone on a Samsung phone for years in SoCal, five years ago, never a dropped call and I found yearly service prepay reduces time/stress keeping "trac" of uninterrupted service with a time limit to resume same number after time expires before next purchase. Double/Triple plans good since minutes don't expire; and online promos are user-friendly too via website, email reminders, and good live customer service if need.

Thanks Bob and all for so many alternatives to explore if I upgrade to more than talk/text on my Verizon (great American C/S!)unlimited $33/mo.

Posted by:

16 Aug 2017

I use Cellular Page Plus. It is the cheapest for me. I turned off text. I use an old flip phone for calls only and it receives voice mail. Costs me $10 every 3 months for which I get 100 minutes. Currently have some 600 minutes. If you pay the day before the plan ends...any minutes roll over to the next few months. I use it for emergencies or phone calls when I can't use my landline. I have a computer...don't need one on my phone.

Posted by:

Bob Rambaldi
16 Aug 2017

I replaced a broken $700 Galaxy S5 and expensive TMobil contact with a purchased LGL84VL costing under $200 and Walmart Straight Talk prepaid card costing about $45./mo with discount for 6 month card and which uses Sprint, Verizon, TMobil and ATT networks usually 4G and works great; phone is a bit larger than old S5 and has latest Android operating system..haven't had any problems with data caps but I don't watch many videos or listen to much music with the phone,,, no contract, low cost = good deal.

Posted by:

Lady Fitzgerald
16 Aug 2017

My cell phone is a dumb as rocks phone that I paid a whopping $12 for and I use for emergencies only or when I'm on the road. I did just fine for most of my life just fine without a smart phone and continue to do so. Having one would be nice and I don't even mind the initial payment for them but, being retired on a so called "fixed" income (inflation dispels the myth of the income being fixed), I cannot justify the cost of the plans for smart phones.

I'm on a Verizon prepaid plan that costs me $1.99 for the first phone call of the day with all calls for the rest of the day being free. I have it set up to deduct $5/month (plus 45¢ in taxes and fees) and to deduct an addition $5 from one of my credit union accounts whenever the balance drops below $5. Unused balances carry over indefinitely. To avoid racking up a bill from phone spam (telemarketers, wrong numbers, politicians, etc.), I have voice mail and texting disabled (I hate texting anyway; if someone wants to talk to me, they can TALK to me).

My land line type home phones are cordless phones connected to the Verizon network using a Straight Talk Home Connect modem (available through Wal-mart). I get unlimited local and long distance talk within the continental SSA (Squabbling States of America) for $15/month (plus $1.60 taxes and fees, including E911; international coverage is available for $30 plus taxes and fees). If I'm going to be away from home for an extended time, I can take the modem and an el cheapo land line phone with me and still use it any where in the SSA where there is Verizon coverage (overall, Verizon still has the best coverage).

One huge upside to the Home Connect system is I was able to use my old cell phone number that wasn't on any phone spammers' lists plus, being a "cell phone", robo calls are banned. I might get one phone spam call every other month (which promptly gets put on the call blocker in my cordless phones). I went through the entire election cycle last year without a single political call (instead of the half dozen or more a day I used to get).

Posted by:

DBA Steve
16 Aug 2017

TracFone is the best for folks like me who don't use it much.

Posted by:

Linda Segall
16 Aug 2017

I use Cricket's 4GB prepaid for $35/mo with autopay. My husband tred Consumer Cellular--great customer service and cheap but we found another MVNO called TPO, which costs us just under $12/month. (He rarely uses the phone or data, so this is a bargain.) TPO uses T-Mobile lines, better than most prepaid, which use Sprint. I considered Google's Project Fi, but discovered my Nexus 5x doesn't qualify.

Posted by:

17 Aug 2017

Wow, Bob!
It sure sounds like you have some very wise shoppers who are also willing to share.
I just came across a T-Mobile deal yesterday which may be of interest to your readers:

55yr old+ get 2 lines with unlimited talk, text and LTE data [ad part deleted RandiO] for $60/mo. with AutoPay.

Posted by:

17 Aug 2017

I just switched to Virgin Mobile's Inner Circle plan. They are offering a whole year of service for only $1 (plus taxes) for unlimited. The catch is you have to buy an iPhone and port your number over and use auto-pay. After the year is up it costs $50 a month. The offer is good until the end of August. After that I think they will still offer 6 months for $1. They are owned by Sprint to the service should be close to that.

Posted by:

21 Aug 2017

I've found NET10 to be the BEST! $30/60 days.

I don't call or text msg alot so this plan is ideal! PLUS minutes carry over, so I have plenty of Time on my phone. Have NET10 phone as well.

Posted by:

22 Aug 2017

This is a Canadian comment. About 10 years ago I bought a "President's Choice or PC MOBILE" (Loblaws Grocery Chain) Samsung flip-phone. The prepaid costs were $15/month, 25/3months,up to $100/year. The cost was 20c/min/local call, plus 25c/min/long distance within Canada. ROAMING was available at a significant premium. The unused balance was credited as per most other Suppliers, if the "contract" was renewed before the expiry date.

2 years ago we were under the BLUE WATER bridge across from Sarnia ON. and I could not use my phone--Turns out that PC MOBILE had changed their contract? with their providers (BELL.CA) and roaming was no longer available for us customers. This year in March I renewed my prepaid contract??? for another year.
During the summer I was informed that I could no longer use my SAMSuNG flip phone after December because it DOESN'T HAVE A SIM CARD. OK I bought an Acer smart phone and transferred it to my PC Mobile account--It worked for a week, sort of, but. So I tried to transfer my phone account number back to my SAMSUNG Flip, BUT COULDN'T because BELL/PC MOBILE had "decommissioned the TOWERS across Canada.

MY COMMENTS to others--Know who are the providers AND who are the carriers behind those providers, or you could be caught up in an expensive loop.

Posted by:

25 Aug 2017

I used to use PagePlus' pay as you go plan for my business but every once in a while I would be caught with no minutes. Now I use their $29.95 plan on the Verizon network. This gives me unlimited talk/text and enough data to manage my email and cloud services each month.

Posted by:

09 May 2018

Hi Bob,
I am someone who just never found the need to have a cell phone, usually relying on just my landline. When travelling, however, it became apparent that public pay phones are almost non-existent anymore... A friend had a Trac Fone that became too expensive for minutes as his usage increased, so he finally replaced it with a smart phone and monthly service plan. Because he had renewed his Trac Fone minutes so many times (with included extensions to his prescription months..) he had gotten bonus extensions to his future months of service credits. He gave me his old Trac Fone (a simple LG flip phone using Verizon that has incredibly good long talk range in rural areas!). It has service paid up till year 2029, and had 488 minutes of talk credit still on it. This is perfect for me: I wrapped it in cushioning and put it into a metal throat lozenge tin. It is always with me, but un-call-able (nor GPS track-able!) while in this metal tin. It has saved my bacon once or twice in emergencies, but costs me $0/month to keep. The LG battery holds its charge for months and I recharge it about twice a year, or whenever I've used it. It is perfectly practical for my needs.

Posted by:

01 May 2020

I purchased my TRACFONE direct from Apple and paired it with their bring your own smartphone came with triple minutes so when I add minutes it gives me a years service and with a 400 minute card it gives me 1200 talk minutes and 1200 texts and 1 gb of data. I do this once a year at a cost of $79.00. My wife has the same plan and when we are near wi-fi it switches over and does not use my minutes or data. I have never dropped a call on either phone and we travel all over the US and have never been in a location where we did not have service. And I NEVER get a monthly bill-ever.
I felt the need to include this because it was not mentioned in your description of Tracfone and is a really low cost and reliable service.

Posted by:

02 May 2020

I would update your Tracfone. I pay $20 for smartphone with unlimited talk and text and 1 GB data per month. I think its $l0 more for each GB. I usually never go over the data limit since most places you use it have wifi available.

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