You’re likely paying hundreds of pounds too much on your mobile phone.
In the past I’d happily upgrade to a two-year mobile contract so I could get my hands on the latest iPhone, paying more than £35 each month plus a sizeable upfront fee. But that’s a thing of the past – I’m currently spending just £8 a month on my mobile phone bill.
Here’s what you need to know to do cut your bill too.
I was with O2 and Orange for the first 13 years of having a phone, but six years ago I moved to Three and bought a new handset direct from Apple. Since then I’ve moved between networks and bought and sold new handsets. And saved a ton of cash.
Right now for example, the closest equivalent tariff direct from my old network O2 (5GB of data with a 128GB iPhone 12 Pro) would cost £54.10 a month for three years (yes, it’s a 36-month contract!), plus £30 upfront. That’s a total of £1,869.60 over 36 months.
Buying the same phone outright direct from Apple combined with my Three deal (for 12GB of data – more than double what O2 offers) and the three-year total is £1,387. That’s a total difference £482.60, or £160 saved a year.
(I actually paid £150 less for this handset thanks to a flash deal meaning my actual saving is £210 a year over three years!)
Even if you’re already on board with going SIM-only, it’s still possible to save. My wife Becky recently moved from SIM-only with O2 to SIM-only with Three, and thanks to cashback her bill will drop from £15 a month to £5.50. That’s a saving of £114 over the next year.
I can’t promise you’ll cut your bills by as much as I have (I do have a very pricey handset), but follow these tips and there’s no reason you should be paying more than £8 a month.
Here’s how you too can save on your mobile phone contract.
Split your handset and your tariff
The best prices are often with SIM-only deals. Here you keep your old handset or buy a new one separately and pay just for your minutes, texts and data. Since you aren’t paying for a new phone, the monthly costs are also considerably less.
You can get contracts that run from 30 days to a year, giving you far more flexibility than the 18, 24 and even 36-month deals you’re tied to with handsets.
At the time of writing you should be able to get 8GB to 12GB plans for around £8 or £10. When I spot any really good prices I’ll share them on my mobile SIMs and phones deals page.
Don’t get your handset via your network
Once you go SIM-only you’re no longer caught in that bi-annual cycle of getting a new phone when you don’t really need to. Ideally you’ll keep your handset for more three or four years. But with poor batteries and broken screens, we all need to upgrade at some point.
However, you should avoid getting one as part of your contract. Most networks will charge you a premium on top of the handset price to get a new phone bundled with your SIM.
It’s very, very rare for these deals to work out cheaper, particularly for the latest handsets. Instead, you’ll save money buying it outright from Apple, Samsung or the likes of John Lewis.
Of course, the high cost of these handsets can be a barrier, but even then you don’t need to resort to including it in a contract. Apple and Samsung offer 0% finance for two years, while you could choose a 0% purchase credit card instead. Do check your credit score first though.
Choosing your new phone tariff
Whether you stick to a combined phone and SIM deal or split them up, you can still bring down the cost.
Don’t pay for more data than you’ll actually use
One of the biggest ways we waste money on our mobiles is via upselling, and now the networks are all about getting us to pay for more data than we need.
When I last got a new contract with Three, the salesperson said “It’s only £3 more for 20GB”. Sounds good. Except I didn’t need 20GB. I didn’t really need the 12GB I have, but that was bizarrely cheaper than the 5GB option.
And I see this upselling all the time. There are always a number of promotions offering unlimited data at what looks like fantastic prices. But you really don’t need unlimited data, so however good the price, you’re still overpaying.
Most of you will be fine with 4GB or 5GB, perhaps less, and it’s easy to check your usage history. I’ve written here about how you can work out exactly how much data you need.
Factor in the extras and freebies
I wouldn’t recommend choosing a new phone network based purely on extras, but if prices are similar it’s worth seeing what you can get.
The reason I first chose Three over similarly priced networks was they let you use your inclusive data, texts and minutes abroad in countries such as the USA rather than just Europe, which saved me a fortune on our honeymoon.
But a year later I switched to BT Mobile as I didn’t need this worldwide roaming. When I had another trip to the States I switched back to Three. And during lockdown when there was no overseas travel at all I moved to Smarty in search of the perfect lockdown SIM.
With news that EE is bringing back roaming charges in Europe, any network that weeks keeps this fee-free could be worth an extra £1 a month if you are going to head abroad.
You might also want to factor in what you’d get from O2 Priority or Vodafone’s VeryMe rewards – though both are still available if you’re with a different network if you pay.
Networks will also be trying to upsell you on 5G at the moment. Some of the smaller ones will only be 4G so if that’s important to you it will likely cost more. In reality though, this faster network speed is only currently available in major cities, so most don’t need it (yet).
Don’t just stick to the big companies
You’ll have spotted that most of the cheap deals are with smaller networks. And I bet you’re warry of switching in case you can’t get reception.
Well, there are actually only four different phone networks – O2, EE, Three and Vodafone. All the others “piggyback” on one of these. So, for example, Giffgaff runs on O2 and BT Mobile uses EE.
This means you get exactly the same reception as someone on the host network but at a far lower price. The only real difference will be in customer service, though you’ll also lose network-specific benefits from the big brands, such as O2 Priority Moments or Three’s global roaming.
I’ve written in more detail about these so-called “virtual networks”, including which ones operate on which main network.
It’s also relatively easy to bring your number with you. My moves across different networks all took less than 24 hours though it might take longer if weekends or bank holiday get in the way. Just ask for a PAC number, which you can get just by texting your network.
Finding the best price
Don’t wait for your contract to end
One of the worst tricks networks would use to make extra cash was to let you keep paying for a phone and SIM after a contract had ended. This meant many people would still be paying for a handset even after they’d covered the cost.
However, rules from Ofcom mean most mobile networks will let you know when your contract is due to end and if you can get a better deal with them.
This is a great nudge, but even if you’re offered a cheaper deal, it doesn’t mean you’ll be on the cheapest deal out there – as the following tips will show.
Plus, the rules currently only apply to tariffs purchased directly from the network (i.e. not from an online or high street phone shop), and not all networks have signed up, with Three the main big name missing from the agreement.
Personally, I’d not wait for this to happen as you can usually negotiate with your network up to 30 days before the end of a contract. This gives you the chance to see if you can get a better deal with your current network, and if not start the process of moving to a cheaper one.
Just as you would with your gas or broadband, it’s important to see what other networks are offering. MoneySupermarket or BillMonitor are decent price comparison sites, though they don’t include all the SIM-only networks.
Make sure you also check retailers such as Carphone Warehouse too as they often have their own deals.
Check for cashback
If you’re switching network or upgrading without a new handset there’s less of a chance for cashback, but it’s worth checking anyway.
Try both Topcashback and Quidco. I recently got £40 back from Three on an 8GB a month deal when Becky also switched over. And if you’ve never used cashback sites don’t forget the new member bonuses to get even more back!
You can also earn cashback to knock more off your bill using the app Airtime Rewards.
Watch new videos every week on the Andy Clever Cash channel, plus a regular live Q&A
Call your network to see if they’ll negotiate
It’s still worth calling your network to see if they can match or beat the total savings you’ll find from the tips above. It helps to do some research first so you know what you can get if you switch.
Then ask to be put through to the ‘terminations’ or ‘disconnection’ team as they’ll usually have more sway. You can even do this over live chat if you prefer.
I’ve done this the most years with Three. I’ve either had my price knocked down or data added for the same price, beating what I’d get elsewhere. None of these deals were available on the Three website, but came from saying I wanted my PAC.
Listen to Cash Chats, Andy’s twice-weekly podcast. Episodes every Tuesday and Friday.