According to a recent Deloitte survey, Smartphone penetration rates now stand at approximately 80% in the UK. Smartphones have become incredibly popular in the UK and the world at large because they offer more communication options, endless applications, unlimited web browsing capabilities, unmatched entertainment and so much more compared to traditional mobile phones.
It is, however, worth noting that these added advantages come at a cost. Furthermore, there is a general consensus that mobile providers do very little to help their customers manage costs. Given the high cost of living and stagnant income growth in the UK, it’s important to find ways of cutting costs and saving to avoid over-dependence on payday loans among other types of short-term loans. Here’s how your mobile provider is ripping you off and what you can do;
1. Unlimited plans which aren’t unlimited
Smartphone users love unlimited data plans especially when data usage is concerned. In a world where live streaming rules, unlimited plans are highly sought after. What most Smartphone users fail to realise is; most unlimited plans have hidden limits which make them limited. For instance, unlimited data usually comes with speed and/or device limits if you exceed a certain limit. Mobile providers do maximize profits without causing congestion in their networks. To avoid paying for an unlimited plan which is not really unlimited, it’s important to do your own research before jumping on any unlimited plans that come your way.
2. Too much/too little insurance
Smartphone purchases via mobile providers usually cover repairs and replacements resulting from damage. There are however limits to this coverage. In most cases, you have to part with more money to insure your phone adequately against the most common Smartphone risks. In simpler terms, the insurance coverage you get when you buy a phone from your mobile provider is very basic.
On the contrary, mobile providers are also guilty of selling too much insurance to Smartphone buyers. You should check what is covered in your warranty, free insurance plan, and credit card plan (if you have any) when you buy your Smartphone to avoid incurring unnecessary costs. Mobile providers make money from selling Smartphones insurance, so research for a cover that serves you well instead of taking what is on offer. It’s also important to consider the fact that you may already have coverage.
3. Hidden contract terms
Mobile providers are also guilty of hiding contract terms, yet these details are crucial for controlling monthly Smartphone expenses regardless of the type of plan you have. You can find contract term details in your mobile provider’s website. It is important to read the terms yourself and seek clarification if needed as opposed to relying on what a mobile provider salesperson tells you. Mobile providers usually hide crucial information on upgrade fees, international roaming fees, overage fees and many other fees/conditions in lengthy contracts yet this information is vital for controlling cost. So, take time and read your contract to the letter.
4. Unauthorised/unnecessary text charges
Some mobile plans come with unlimited texting while others charge you a fee for every text sent. Others also charge for promotional texts received. It is important to avoid replying to unsolicited text which are promotional in nature. Such texts come in many forms i.e. as questions requiring an answer. You should avoid replying to such texts and anything you have not subscribed to. It’s also important to understand the texting limits of unlimited plans. You should also consider using free texting/messaging services today like Whatsapp or Facebook messenger to reduce your texting costs significantly. Such services are usually free if you have a Wi-Fi connection.
5. No cash on trade-ins
Mobile providers pay in credit as opposed to cash for old phones. They also tend to take longer compared to private options such as dedicated buyback companies which give cash instantly or send it within a few days. Furthermore, they tend to offer lower payouts for trade-ins (approximately 30% less) for old cell phones compared to buyback companies. It’s, therefore, better to sell your old phone through buyback companies when you are looking for an upgrade if you want to get the best value.
You stand to enjoy substantial savings and avoid reliance on short term loans by understanding how mobile providers rip off their clients. You can save £100 + pounds every year by understanding the terms of your mobile plan/contract and choosing insurance plans carefully. Avoiding texts and mobile provider trade-ins can also go a long way in reducing the money you spend on your Smartphone.
Is the Company Director of Swift Money Limited.
He oversees all day to day operations of the company and actively participates in providing information regarding the payday/short term loan industry.