Verizon Wireless announced last Friday that it was getting rid of its service contracts, which applies to all the carrier’s new subscribers, as well as current ones purchasing a new handset. Instead, America’s biggest wireless carrier are simplifying things by offering just 4 basic plans for customers to choose from: 1) small, which offers 1 gigabyte of data a month for $30, 2) medium, which offers 3 gigabytes for $45, 3) large, which offers 6 gigabytes of data for $60, and 4) extra large, which offers 12 gigabytes of data for $80. No down payments, activation fees, or two year contracts, and customers can either pay for the full cost of the handset up front, or pay it off monthly over the course of a couple of years.
It is a good deal for sure, but there are ways in which you can optimize your savings. Perhaps the best one is to keep your current handset and then avail of a big data package. For instance -- you have been using 12 gigabytes of data a month on your Samsung Galaxy S4 handset whose two year contract is over -- you are paying the Big Red $140 monthly, and you would keep paying the same amount even if you choose to keep your device. But with the new plans, you would pay only $100 monthly if you choose to keep your device, which equals $40 a month in savings. By this logic, you would have bigger savings if you go for big data packages. What if you are already under Verizon Edge? Switching to the new plans will still result in savings, but not by much. There is only a $5 difference monthly, but hey, it is still cheaper.
What about those customers who are new or about to renew? Well, they have two ideal options available to them. One is to purchase their handset outright, which entails paying for the entire price of the phone upfront. That may sound more expensive at first, but on a month to month basis, you will be able to save more over a two year period (especially if you avail of a big data plan). The second option is to pay off the handset over a period of two years. Under small data packages, you could pay a bit more monthly for a couple of years. But still, the previous two year contracts would have required you to pay a down payment of $200 plus an activation fee of $40 -- those charges no longer apply to Verizon’s new plans, which means that the new plans are still more cost effective in the long term.
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