The Difference Between Contract and SIM-Only Phone Deals

Written by Michael Foote , founder of Quote Goat, with over 13 years experience working in the finance, insurance and currency sectors.

In a world governed by technology, statistics suggest that over 45% of the gobal population have a smartphone, as of 2020. As a result, finding the perfect deal has never been so important. There are dozens of different mobile phone providers on the market who all claim to offer the most lucrative deals, however there are still many people that do not understand the difference between a mobile phone contract and a SIM-Only deal. Read on as we reveal all…

Put simply, a pay-monthly contract requires a customer to pay a fixed fee each month for their phone and ties you into a contact that typically lasts for 24 months. With this said, there is usually only a small fee to pay at the very start which makes it a very affordable and attractive option that allows you to get your hands on the latest phone model. Many people find that contract phone deals are actually more affordable because the costs are spread out over several months; however, phones often depreciate in value which means that you may end up paying a lot of money for something that is no longer worth as much once the contract comes to an end.

On the other hand, a SIM-Only deal covers the mobile service itself such as the minutes, texts, and data allowance. In these cases, the customer will pay for the phone in its entirety and own it. This reduces the monthly fee considerately but is generally unaffordable for those people who cannot spare such a large initial expense. With this said, there is no need for a credit check which means that more customers are eligible, and there are no contracts to lock you in place which gives you the freedom to change your mind at any point.

An affordable smartphone is just one part of the puzzle as it is also wise to protect your mobile phone with insurance so that it will be covered in the event of accidental or intentional damage. After all, there is nothing worse than dropping your brand-new phone and being unable to afford the repairs because it has no insurance. For all your mobile phone deals and information, check out Quote Goat’s trusted comparison site today!

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