T-Mobile Launches No Contract Unlimited Plan: Is it Right for You?

by Miranda Marquit

My husband has been using T-Mobile for years. He’s been using the unlimited talk and text on his non-smart cell phone for quite some time, and it’s worked well for us. (I’ve been using a non-smart cell phone with Tracfone for years.)

T-MobileRecently, we decided to upgrade both of our phones to smartphones, and, since we’re not fond of contracts, sticking with T-Mobile seemed like a good idea. We have to pay more for our phones, but we also aren’t tethered by a contract – and we’re paying less per month for unlimited talk, text, and data than we’d pay if we went with Verizon, which is our other major option here in town.

Here is a look at our options, and what we’re doing:

Before the Switch

Upgrading to the iPhone 5 means that we are paying more per month for phone and Internet services than we were before. Before making the switch, we had a home phone through the Internet, paying a total of $93.90 for voice and Internet service.

My husband’s monthly plan cost $50. Since I was on Tracfone, the cost varied according to how much I used the phone, with the monthly cost breaking down to between $4 and $7 per month. If you add all of that up (and assume the higher $7 cost for my Tracfone), the monthly bill came to $150.90.

Our phones were also quite inexpensive, costing about $50 apiece, so $100. Over the course of two years, we paid $3,621.60 for voice services plus Internet.

With T-Mobile

As part of our switch, we ported the home phone number to my cell phone and ditched the phone portion of our service. This leaves our monthly high-speed Internet at $64.95 per month. My son now has my Tracfone, and will be using it much less than I did (for now anyway), at a monthly cost of about $2. Our new T-Mobile service is $80 for our shared plan with unlimited talk and text. To receive unlimited data access, it’s another $20 per month per phone, so our monthly total for the T-Mobile plan is $120. (This plan also comes with 500 MB free Hotspot data.) So, the monthly total cost for voice, messaging, and Internet service is $120 + $2 + $64.95 = $186.95.

We’ve already decided this monthly increase of $36.05 is worth it, since I’ve been able to use my phone for work on the go already, and my husband has made liberal use of the phone as a GPS device.

The phones aren’t subsidized, so they cost $580 (we got the cheapest option). However, if you turn in your iPhone 4 or iPhone 4s, you can get a credit of between $100 and $120 to knock down the cost. The other cool thing is that T-Mobile will let you pay off your iPhone 5 over the course of two years, interest free.

Two year cost for voice, messaging, and Internet service with T-Mobile: $4,486.80.

Verizon Alternative

Finally, we could have gone with Verizon. The phones are $199.99 apiece, with a two-year contract. However, the monthly cost with Verizon is more. There is the “Share Everything” plan that costs $40 per month. However, that doesn’t cover data access. According to the data estimate, my husband and I use about 16 GB per month (this is consistent with our trend of usage so far). This plan level costs $130 per month, plus the two $40 charges for a total of $210 per month. Add in the home Internet and my son’s $2 per month, and the monthly total is $276.95.

The two-year cost with the phones and the monthly charges is $6,646.80.

In our case, T-Mobile is worth it over the cost of Verizon – especially if you add in the fact that it costs $350 to cancel the Verizon contract early, if you decide to move on before the two years is up. There’s no worry about a cancellation fee with T-Mobile, although if you take the lower pricing on phones with T-Mobile, you’ll still be liable for the monthly charges for the phone hardware.

Is the new T-Mobile “Simple Choice” plan right for you? Run the numbers in comparison to other plans to see what’s best for you and your family! Will you save money on your cellphone bill?

What do you think? Would a T-Mobile plan work for you? Leave a comment!

Published or updated October 10, 2016.
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{ 7 comments… read them below or add one }

1 brad

almost $4500 for 2 phones and internet for 2 years? and you’re asking if that’s a good deal?
um, no.
not to me, anyway. but i’m old- skool. i remember when phone bills were $20 a month for a 2-party line. i think apple has brainwashed people into thinking they need things which they really do not. i say don’t fall for it. it sounds like you think it’s worth it because hubby uses a lot of gps. what did he do before? get lost a lot?
i pay $50 a month to brighthouse for internet. im not happy about that, but that’s the only game in town other than verizon fios, which is even more expensive. if i want to know how to get somewhere, i mapquest it on my laptop at home first.
for phone service, i pay $20 a month to metro pcs for unlimited talk and text on a decent flip phone by samsung. no complaints. it works great.
so my bill for phone/internet is $840 per year, or $1680 for 2 years. that’s a much better deal, and im not saddled with a phone-cum-pocket computer that is overpriced when new and obsolete in 6 months.


2 Jake Erickson

My wife has been looking pretty hard at tmobile vs. the Walmart plan. Both require you to buy an unlocked phone at full price because you don’t have to sign up for a 2 year contract. It costs a lot up front, but it still ends up being cheaper than Verizon or Sprint and you end up with no contract.


3 Grayson @ Debt Roundup

I think this could be a good option for anyone looking to break away from a contract. You can also jump over the Straight Talk which uses T-Mobile’s network and it costs $45 per month per phone. You need to purchase the phone as well. This option wouldn’t be good for you because you use 16gb per month which is a lot of data.


4 Ryan Guina

Glad to see you will save a lot of money, Miranda! My wife and I are both grandfathered into the Sprint SERO plan, which has great features at very reasonable prices. If we didn’t have that plan, I would look hard at going with one of the “second tier” services, such as Tracfone, StraightTalk, etc. (second-tier in terms of price; most of them use the same networks the big services use). I think there are a lot of ways people can save money on cell phone plans and other services when they shop and compare.


5 Dan

I thought the point of the article was to save money? You are going from $3600 to $4500 over two years and even considered $6500. And you appear to be getter a lower overall quality of service.

Just feels like you are telling the world what you can afford


6 Ryan Guina

Dan, I think saving money is relative. Yes, the argument can be made that you aren’t truly saving money if you are spending money, but I think that’s semantics. If you have decided this is a product or service you want or need and you are going to buy it anyway, then it comes down to finding a way of getting the product or service at a lower price point. This can apply to almost anything. Even if you are spending hundreds of thousands of dollars, you can save money by buying a comparably sized house in another neighborhood/town/state, etc. The same applies to products of all sizes and price points.


7 Miranda

The point of the article is not strictly to save money overall. It’s a look at T-Mobile’s offering. Almost anytime you decide to get a smartphone, you are going to pay more money. We knew that going in, and decided that, for us, spending the money was worth it. We compared our options (which, for us, really boiled down to T-Mobile and Verizon). I am a firm believer that you prioritize your own spending. Do we *need* smartphones? Of course not. Do we want them? Yes. Have they helped us meet some of our other goals and improved our quality of life? Yes.

The key is this: Can we afford the increase without damaging our ability to fund other priorities? Yes. We’re not going into debt for these phones. We haven’t cut our retirement account contributions, our emergency fund is still intact, and we still give the same amount to charity. This was a planned purchase and a calculated move. It’s what we decided to spend our money on, so the only real question was which plan/service was going to give us the best value for our smartphone buck.


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