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Choosing a Type of Prepaid Plan

No-contract wireless prepaid plans have become more and more common and it seems like all of the four major carriers have monthly plans, prepaid brands or both. But as the prepaid consumer base grows, I have noticed a divide between the types of plans offered: pay-as-you-go reloadable accounts and prepaid monthly accounts. While the trend is quickly moving towards the latter, it is still possible to find pay-as-you-go plans without being grandfathered in.

And that leads to another question: Which is right for you?

Here are some pros and cons of each so you can decide.

Pay-as-you-go Plans

As the name implies, pay-as-you-go plans involve buying credit for minutes, texts or data as you need them and then paying a set rate for every minute, text or MB used. Back in the day, this was the primary way that prepaid phone plans were set up and how much you paid per minute or text depended on your carrier. When you run out of minutes, your phone turns into a paperweight until you could afford to reload it. But, for people who seldom use their phones, this type of plan is excellent.

Pros:

  • You only pay for exactly what you use. No more, no less.
  • No commitment–if you don’t have money, don’t buy minutes
  • Good for kids, because there are no dangers of overage
  • Unused minutes/texts/data will roll over until expiration

Cons:

  • Prices can stack up pretty quick for long calls
  • Higher risk of losing your number
  • Data plans are oftentimes not reasonable
  • Short expiration dates can cause trouble for low users

Prepaid Monthly Plans

Unlike the pay-as-you-go plans, these plans are set up very similar to postpaid services, but they require no contract. Instead, you pay a flat fee every month and can use whatever services they offer for your payment tier. Most prepaid monthly plans include unlimited minutes, texts or both–but not all. You can usually add services as you need them, and they will expire eventually. A lot of times, these types of plans will include data as well, but they can be more pricey than the pay-as-you-go alternative.

Pros:

  • No worry about running out of minutes/texts a month
  • Bill is the same every  month
  • Data is usually available for a bit more
  • Not as much danger of losing your number

Cons:

  • Prices are higher than pay-as-you-go
  • It’s easy to end up paying for a lot of minutes/texts you don’t use
  • Data plans are often deceptively worded
  • Some plans/carriers allow you to go over allotment and put it on the next bill
  • Unused minutes/texts/data do not usually roll over

It all really depends on how much you use your phone, whether you are worried about running out of minutes, if you want data and how much you are willing to use your phone. Some phone plans offer discounted or free nights and weekends as well as other perks like free access to Facebook or free music streaming. The options for customizing your own prepaid plan and payments have become more extensive than ever and with no contracts, you are free to switch as much as you like until you find the perfect fit for you.