4 Mobile Phone Upgrades That Aren't Worth the Money

By Damian Davila on 17 April 2015 5 comments

The old adage says "If you buy what you don't need, you'll need what you can't buy."

When you have a mobile phone, you're already shelling out some serious coin every month. The average U.S. monthly phone bill ranges from $120 to $148. So, there's no need to pay for additional features you don't really need.

Consider avoiding these four costly plan upgrades.

1. International Long Distance

Unless it's an absolute emergency, it just doesn't make sense to make international calls using your mobile phone's plan. For example, as an AT&T subscriber, I would pay $2.19 per minute if I were to call to a landline in Ecuador, or $2.37 per minute if I were to call a wireless number.

While paying $5 per line to upgrade to AT&T World Connect lowers my calling rates to Ecuador ($0.35 per minute to landlines and $0.53 per minute to wireless), it is still not worthwhile. Without paying any additional fees, I can call any landline or mobile in Ecuador for $0.15 per minute, by signing up for a Skype subscription. I'd decrease my calling cost to landlines in Ecuador to as little as $0.075 per minute.

You could also leverage smartphone apps, such as Line, Tango, or Viber, that allow you to make international calls for free. Or, buy an international calling card with good rates for the country that you're trying to call. The point is that there are much more affordable options than upgrading for an international long distance feature.

2. Frequent Equipment Upgrades

T-Mobile Jump, AT&T Next, and Verizon Edge offer variations of the same idea: Instead of committing to a single phone model for two years, you can upgrade to the latest model as soon as you want. No matter your phone carrier, if you have a frequent upgrade plan, you pay a monthly fee based on the full price of your selected phone (cost of service is separate).

From a purely financial perspective, frequent equipment upgrade plans often aren't worth the money. For example, you could save close to $650 by sticking to a two-year plan with AT&T, instead of going with a frequent upgrade plan for two years. Similar savings scenarios happen with Verizon ($600) and T-Mobile ($340). (Note: Sprint retired its One Up upgrade plan on January 9, 2014). The premium that you pay for the "convenience" of having the latest model is too high and something that you don't really need.

3. International Data Plan

I get it, I really do.

Just like many Millennial travelers, I believe that a trip isn't a trip without posting a few vacation pics for my friends to view. About 69% of Millennial travelers use some form of social media during vacations.

Most service providers provide international data plans starting at 100MB. For example, AT&T's 120MB data plan is $30, and Verizon's 100MB data plan is $25. The problem is that a 100MB allowance doesn't go very far. Consider how much data some common activities consume.

  • Emailing a single high-resolution photo is 2MB to 5MB.
  • Doing a 10-minute video call is about 24MB.
  • Visiting 50 web pages equals about 10MB.
  • Completing 30 social media posts with photos is roughly 10MB.
  • Downloading 10 songs is 40MB.

You could burn through 100MB of data in a single day. And that's assuming that you're keeping track of all of your data use. If you unintentionally left on the auto-push feature of your smartphone for all apps, you could easily burn through most of the data in just a couple of hours.

Instead of buying an international data plan, take the following steps when traveling abroad (See also: How to Minimize Cell Phone Charges When Traveling Abroad):

  • Use the Wi-Fi from your hotel or from other reliable sources;
     
  • Plan ahead with smartphone map apps, such as Ulmon Maps and OsmAnd, which can work without an Internet connection;
     
  • Keep your phone in airplane mode as much as possible to prevent data use;
     
  • Prevent automatic upload of media.

4. Tethering

Sharing your data connection with all your other devices sounds like an awesome deal. However, the reality is that mobile tethering has several drawbacks:

  • Most cellular carriers will require you to pay an additional fee or upgrade to a minimum MB plan to be able to tether through your device.
     
  • There is no cellular carrier that will let you tether any device with an unlimited plan. You have to downgrade to a paid data plan, and figure out which one makes financial sense.
     
  • You have a data cap when tethering, often ranging from 2GB to 5GB. Depending on your data use, you may incur overages and their corresponding expensive fees.
     
  • Tethering is major drain to any mobile's battery life.
     
  • Many users report that their Internet connection freezes when the phone receives a text or call.
     
  • You're always trading off something when you're tethering. Tether via Wi-Fi, and your phone's battery drains quickly. Tether via USB, and only your computer can connect to the Internet. Tether via Bluetooth, and your connection gets very slow.

This is why that tethering fee is something that you don't really need. Imagine if your home Internet provider would try to charge you for plugging an additional device to your home connection. You would probably tell your Internet company that they're crazy. If you really need a hotspot on the go for work purposes, you're better off investing in a mobile hotspot. That way you won't have to compromise for subpar service.

What are some mobile plan upgrades that aren't worth the money?

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Guest's picture
Guest

TMobile has free international data with all their post-pay plans (granted, it's only 2G). I recently traveled to Europe and was able to use Google Maps, Translate and Yelp without having to pay one cent. I waited until I got back to my hotel or places with free Wifi to upload pictures to Instagram.

Damian Davila's picture

That's a great tip, Guest. On my last trip to Spain, I would have my phone on airplane mode and snap away using Instagram. The app saves all pics that failed to post. Once I got to the hotel I could make the pics live little by little.

Guest's picture

Verizon edge was the biggest mistake we made...

Damian Davila's picture

Sorry to hear that, Michelle. What happened?

Guest's picture
nabejero

Re: int'l data plans. At least in Asia, getting a local sim card is less than a dollar, easily purchased at airport arrivals terminals. I've used the gamut of services for $5-10 on a two week stay in any country (calls and texts, google maps, skyping, Facebook uploads etc)

Damian Davila's picture

That's good advice, Nabejero. One big issue is whether or not the phone you have will work in another country. If it does like yours did, then that's a great way to save money.

Generally, you need to have your phone to be unlocked to work with SIM cards abroad. Most AT&T and T-Mobile users report on online forums that their phones work fine with foreign SIM cards and plans, however it's always a good idea to double check before leaving for your trip.