These days, with manufacturers such as Samsung and Apple releasing new flagships year after year, we all want the latest and greatest smartphones in our pockets. Cell phone providers are great at giving us what we think we want and still turning a tidy profit, and sure enough, companies like Verizon and AT&T are all marketing their early-upgrade plans as loudly as possible. But are these plans everything we hope them to be? We broke down the details of every early-upgrade option on the market in order to find out.

What Are Early-Upgrade Plans?

The best cell phone providers offer three different kinds of plans: contract plans, prepaid plans and early-upgrade plans.

  • Contract plans lock you into service with a given provider for two years. In exchange for promising to stay with that provider, you get huge discounts off the retail price of top smartphones, from $600 or $700 down to just $200 or $300. When smartphone manufacturers advertise the prices of their newest flagships, they usually use these lower, "subsidized" prices.
  • Prepaid/no-contract plans don't lock you into two-year contracts, so you can switch to a different provider whenever you like. However, you don't get subsidized phone rates with these plans, so you'll have to pay the full, retail price of your new phone up front.
  • Early-upgrade plans split the difference between contract and prepaid. Instead of paying for your phone up front, you can split the payments out over two years. After a certain amount of the phone is paid off   between 50% and 75% of its full cost, depending on the carrier   you can trade it in for a new phone, and repeat the process. You still have to pay a monthly line fee, but it's usually lower than a contract plan's monthly rate.

Early-upgrade plans sound, at first, like a great deal: You don't have to pay off a phone completely before moving to the next one, and the cost of your monthly bill goes down   although it doesn't include the cost of the phone. So what's the catch?

Contract vs. Early-Upgrade

The catch, unfortunately, is that you'll usually end up paying more for an early-upgrade plan than you would on an equivalent contract plan, once you factor in the monthly cost of the phone. After all, if that weren't the case, carriers wouldn't offer early-upgrade plans as an option. The question that inevitably arises is one you have to pose to yourself: How much more are you willing to pay for the ability to get a new phone every year?

In order to crunch the numbers, we posed ourselves a hypothetical: What if someone with excellent credit (who could consequently take advantage of zero-down deals) wanted to buy the latest iPhone every year? How much would they end up paying over the course of two years at each of the major carriers? And how much would they pay if they only upgraded their phone after those two years elapsed?

For the purposes of this hypothetical, we assumed that you would get a plan with unlimited talk and text and 3GB of monthly data   about average for a smartphone enthusiast. We found, surprisingly, that while three of the carriers do indeed charge more for early upgrades, at Sprint and U.S. Cellular those plans are actually cheaper than their contract-based counterparts:

You'd expect to pay a little more for the privilege of getting an extra flagship phone every year, rather than every two years. Sure enough, at Verizon, AT&T and T-Mobile, you'll pay anywhere from $90 to $190, every year, to get that extra phone. Note that these prices include the cost of the phones themselves; they're not merely what you'll pay for the talk, text and data plans.

Below is a breakdown of how we arrived at those numbers. If you don't want to compare the details of each cell phone plan yourself, don't worry; we'll look through the highlights in the next section. 

Breaking Down the Numbers

Based on our research, there are three major takeaways worth noting:

  1. Assuming your credit score is decent, it's usually cheaper up front to get yourself an early-upgrade plan, rather than go with a contract plan. Every carrier offers $0 down on brand-new, flagship smartphones, and most will wave their activation fees.
  2. You will always pay more month-to-month on an early-upgrade plan than you would on a contract plan   between $5 and $25 more, depending on the carrier.
  3. Over the course of one year, getting an early-upgrade plan with one of the carriers with the best cell phone coverage will set you back an additional $100 to $200. But, of course, you get a brand-new phone every year, rather than every two years.

Depending on where you live, what your coverage needs are, and what your budget is, different providers will be more or less attractive to you. Here are some basic takeaways for each:

  • AT&T offers great speeds and coverage that's almost as solid as Verizon's, but for over $300 less than every year. If you want an early-upgrade option with a solid balance of speed, coverage and price, this is it.
  • Verizon Wireless remains the single most expensive cell phone provider of the bunch. Getting an early-upgrade plan with them will cost you almost $200 more than a regular contract plan. You'll end up paying over $1,500 per year, but you get Verizon's world-class coverage and customer support.
  • T-Mobile is affordable as always, although its early-upgrade option costs $120 more every year than its regular plans. Since you can always pay off your phone with T-Mobile over time, you're not getting any more convenience for your extra $120. You are, however, getting a second phone and included phone insurance, which is a nice bonus.
  • Sprint's early-upgrade option is actually cheaper than its contract option, by a full $40 a year. It's easily the most affordable upgrade program on the market, and we'd recommend it whole-heartedly were it not for Sprint's notoriously iffy coverage and slow download speeds.
  • U.S. Cellular is a regional carrier that also offers early upgrades, and   like Sprint   those upgrade plans are cheaper than the carrier's contract options. However, the U.S. Cellular's overall price point is higher than all the other providers except Verizon. They are, quite simply, expensive. Unless U.S. Cellular is the only provider in your area   an unlikely scenario, but it's the case in a few pockets across the country   you should pick someone else.


If you're looking for an early-upgrade program that will let you buy a new flagship phone every year, and you can have your pick of carrier, go with AT&T. They've got a solid network with great coverage and fast speeds, and you'll save several hundred dollars over competing programs.

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