There are a ton of commercials on television advertising the different cell phone companies and their plans for prepaid_cell_phone_250x251consumers. But a paid, monthly contract phone plan may not be the right kind of phone plan for you and your budget. It really depends on your usage and personal preference.

In lieu of a monthly contract phone plan, you have the option to have instead a prepaid cell phone. With the prepaid phones, you are not locked into a 1 or 2 year service plan and do not face having to pay hundreds of dollars in penalties and fees should you choose to switch to a different prepaid phone. The pay-as-you go plan allows you to prepay for the minutes you expect to use on your phone and then the amount of minutes actually used will be deducted from your account. With contract plans you may have the option to rollover those unused minutes but essentially you are paying for the minutes whether you use them or not.

Since many monthly contract phone service provides usually require a credit check before opening a phone account, those with bad or no credit histories may opt to use a prepaid phone instead, which requires no credit check. The pay-as-you-go phone plan can also be a better choice for your budget as you can set the amount of money you can afford to pay each month, instead of facing a high monthly bill you may not be able to pay off each month.

There are several different options available for prepaid phone plans. Citing two examples here, we will discuss the popular Tracphone and Net 10 prepaid phones.

Tracphone

Tracphone boots to be the leader in prepaid wireless service in the US. They offer several value plans, where you can purchase minutes for a flat rate fee each month. Text messaging is available on the phones. You can also add bundles of minutes at any time you are running low. Brand name phones are available starting at $14.99. If you already had a cell phone number, you can transfer your old number to your new Tracphone. You can activate and refresh minutes online or via the telephone.

The Net 10 prepaid phones charge $.10 a minute for all calls (local, ling distance, and roaming nationwide). The cost of the actual phone ranges from $19.99 to $59.99 and includes many of the popular brand named models (LG, Motorola, Nokia) in a select group of styles. Phones have text messaging capabilities, which cost the sender $.05 per message. Users prepay money to activate and use the phone. Net 10 offers 4 inclusive programs, where users pay a flat-fee to access different amounts of prepaid minutes. You can get 150-400 minutes for a flat rate fee or you can pay for the Net10 Unlimited program that gives you unlimited calling and texting for a flat rate a month. (Note: The Unlimited plan is not available in all areas.) Whenever you need to replenish minutes, you can log on to the Net 10 website or call the toll free number.

If you have been working on your budget and need to find some areas where you can cut costs, compare how many minutes you actually use on your cell phone each month and see if it might be more financially smart to switch to a prepaid wireless plan than it would be to continue renewing your monthly contract with your present provider. Just remember, only make the switch at renewal time or you can expect to pay upwards of $200-$300 to break your contract.