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The vast majority of people choose to go for a mobile subscription plan while prepaid plans represent a minority out of the total addressable market for mobile carriers. The reason why most people choose a subscription instead of a prepaid plan is that they get good deals on smartphones. Certainly, you have been tempted more than once to enroll in a 12 or 24-month contract just to renew your smartphone. While this can be lucrative, the advantages of prepaid plans cannot be denied and can be divided into three major points.
A 12 or 24-month contract will lock you in a subscription that you cannot change. You cannot get a lower-tier plan but you may be given the option for an upgrade to a plan that is more expensive. Prepaid plans can be changed on the fly whenever you need something extra. Mobile carriers usually offer various options that you can get on top such as more data traffic, SMS traffic, or voice call extras.
All the extra packages mentioned above for prepaid plans can be purchased individually or can be purchased in a bundle that includes multiple options. This is one of the main advantages of a prepaid plan. You get to pay only for what you use.
#2. No contract
As prepaid plans do not lock you into a contract for one year or more, you top up your prepaid card every month or whenever you see fit. There is no monthly bill, due date, or any kind of obligation. If you do not want to use a prepaid card anymore, you have the option to do so.
Another advantage of not being forced into a contract using prepaid plans is that you are not forced to use just one carrier. You can switch from one carrier as per your needs and at any given time. You can even switch to a different carrier after just one month.
#3. It is cheaper
The great deal that you think you are getting on a subscription contract for a smartphone is not that great once you do the math. The monthly subscription is quite high. That high monthly bill is supposed to cover some of the cost of the discount you are getting on the smartphone.
On the other hand, one of the advantages of a prepaid plan is that there are no extra hidden costs that need to be covered. In turn, it is much cheaper to switch to prepaid plans than to have a monthly subscription plan. Your costs can vary based on your needs and how you use the mobile network. In practical terms, you do not need unlimited voice calls and SMS. You may not need even unlimited data. A basic prepaid plan can be half the price of the cheapest 12-month contract. If you need more voice, SMS, or data traffic, you can just buy an extra pack for a particular month when your usage is higher than usual. After that, there is no obligation to pay extra.
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