YOU might be making a few simple mistakes that could be adding £1,490 to your mobile phone bill every year.
The cost of living crisis has put a dent in everyone’s wallets and many of us will be finding ways to cut costs.
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Our phones are something many of us can’t live without but some of us may be paying way more than we need to.
More recently, many providers have upped the costs of phone bills in a blow to customers already facing high costs.
Telecom providers commonly increase their prices annually based on the rate of inflation plus an extra 3.9%.
Earlier this year, this was set at 10.5% meaning most bills rose by 14.4% on April 1 – but not all companies follow it exactly.
The inflation rate has since fallen to 8.7% in the year to April – the first time it’s dropped below 10% since August last year.
The Sun spoke to two experts about the five biggest mistakes mobile phone customers make and how much it could be costing them.
While not all mistakes may apply to you every year, it’s important to be aware of them in order to cut costs.
Paying for a phone you already own – £500
Gareth Turpin, chief commercial officer at Virgin Media O2, said one thing consumers are overpaying on is for their handsets that they’ve already paid off.
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If you have a contract phone, then you’ll have a bill which is divided by the handset and then the airtime bill (minutes, texts and data).
The device plan is usually either 12, 24 or 36 months but many people don’t realise they’ve come to the end of their plan.
Gareth said: “Many people are in contracts which bundle together airtime and handset repayments, offering little or no discount for the phone once it’s been paid for.
“This means that staying out of contract for even one month can lead to you overpaying for your smartphone. For customers out of contract with the latest handsets, this could be costing them more than £500 a year in unfair overpayments.”
He said customers should split their phone contracts so they pay for the airtime and device separately.
“This stops you from overpaying for your handset because at the end of your contract your monthly phone bill is automatically reduced and you’ll only pay for what you use – the data, minutes and texts,” he added.
“If you’re already out of contract, you could be paying for a phone you already own so speak to your provider.”
Once your contract has finished, it may be best switch to a SIM-only plan as they can sometimes be cheaper than what you’re paying via your contract.
Liz Hunter, director at Money Expert, added: “If your phone contract ends and you don’t do anything, you won’t be cut off.
“However, you’ll carry on paying the same price, to the same provider, for the same allowances.
“So if your contract included a phone, you’ll still be paying for a phone that you’ve already paid it off – a major waste of your money.”
Liz also said that if you’ve finished paying for your contract, change to a SIM-only plan without getting a new phone.
She said: “It might be tempting to switch to the newest handsets every couple of years, but if your phone is still in good condition at the end of your contract, switching to a SIM-only plan could save you around £500 a year – and often more.”
An estimated 5.3billion mobile phones ended up in landfill in 2022, so as well as saving you money, keeping your working phone and opting for a SIM-only deal is also better for the environment.
Getting a brand new device every time – £200
Another way Gareth said billpayers are wasting money is by getting a new device every time they switch phones.
“The second-hand phone market can provide great value for those looking to upgrade but don’t want to pay for the latest handsets.
“Some providers now offer refurbished devices with 12-month warranties to offer even better value to consumers.
“For example, opting for a refurbished iPhone 13 rather than a new one with the major providers can save you around £200 per year.”
Consider choosing a refurbished device to save on your monthly cost.
If you’re able to buy a secondhand phone outright – at the time of writing, a refurbished iPhone 11 costs £249 on MusicMagpie.
In comparison, a new one from Curry’s will set you back £439 – that’s a £210 difference.
Going straight for a contract – £300
Liz said that if shoppers are able to, they should think about buying a phone outright.
She said: “If you need a new handset and have some savings available, buying a new phone outright and pairing it with a SIM-only plan often results in a slightly lower overall cost (around 7–10%) vs paying via a monthly contract.
“For example, a 256GB Samsung Galaxy S23 Ultra on Vodafone’s 25GB data deal would cost you £75.50 per month for 24 months, plus a £49 upfront cost – £1,861 in total.”
Of course, like with buying a refurbished phone, only do this if you can afford to.
Not doing your research – £490
Liz said one mistake she’s noticed shoppers make is by going straight to the main four networks (O2, EE, Vodafone and Three) for new devices and contracts without checking what others are out there.
She said this could cost people £300 a year.
“Smaller providers like iD Mobile, GiffGaff, Smarty and even Tesco are likely to get you much better value for money, even if you need a new phone via a monthly contract,” she said.
“For example, the Google Pixel 7 Pro is available from iD mobile for £26.99 per month, for 24 months, with a £129 upfront cost and 28GB data – a total of £777.
The same model, Liz added, with the same data allowance and the same contract term, is available on EE’s ‘no-frills’ plan for £58 per month with a £90 upfront payment – a total of £1,482.”
On top of that, Gareth noted that many shoppers miss out on deals and offers that are provided by its network.
For example, shoppers with O2 could get a 20% student discount or a family bundle which will cut the cost of their monthly bills.
He said: “Check with your provider to see if you can benefit from a discount or put the family on one easy to manage bill.”
How else can I cut my mobile bill?
If you think your bills are too high and want to drive them down, the first thing to do is find out what the cheapest deal on the market is.
You can use this rate as a bargaining tool to get a better offer from your provider or as inspiration to switch providers.
Sites like MoneySuperMarket and Uswitch all help you customise your search based on price, speed and provider.
Haggle a cheaper deal
If you’ve found a cheaper rate with another provider get in contact with your provider to see if they can match the price.
If you’re unsuccessful at haggling, then you could threaten to leave.
Your provider might then feel more inclined to keep you by offering you a better deal.
Attempting to haggle will always make it easier to decide whether to renew your contract or move to another provider.
Check if you can get a social tariff
If your household is on a low income it’s also worth investigating social tariffs.
These broadband packages and discounts have been created for people who are receiving certain benefits.
They’re often available to those on income support, Universal Credit, or disability allowance.
Around 4.2million households are eligible for these cheaper tariffs but only 55,000 are making use of them.
Voxi and SMARTY both offer these cheaper mobile phone contracts and prices start at £10 a month.
Do you have a money problem that needs sorting? Get in touch by emailing [email protected]
