Parents have enough trouble controlling their teens and preteens without the added pressure of worrying about endless cellphone use. This is the time...
Parents have enough trouble controlling their teens and preteens without the added pressure of worrying about endless cellphone use.
This is the time of the year when the issue comes to a head because parents want to stay connected with children for school and after-school activities. Prepaid cellphones, a suddenly hot category, can increase domestic tranquility, as well as appeal to the credit-challenged and light users who can’t justify a regular cellphone bill.
Conventional cell plans, starting at $30 to $40 a month, usually come with a one-year or two-year contract. Subscribers must have a credit card or checking account, and must pass a credit check.
Prepaid plans are strictly cash up front. You buy a phone, typically for $50 to $150, although prices can be as low as $20. Then you buy increments of talk time — such as 100 minutes for $29.99. No credit card, checking account or credit check is required.
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You can’t get in over your head. When the phone runs out of minutes, it stops working until you buy more. Conventional monthly plans, in contrast, let you talk through your assigned bucket of minutes as the bill keeps going up and up — a bill you often won’t see for several weeks.
There’s also a new wrinkle in prepaid service: “hybrid'” plans, which charge a monthly fee in exchange for lower rates for frequent talkers. These plans require a credit card or checking account, but no credit check.
Virgin Mobile just added a hybrid plan in July, called Month2Month. For $29.99 a month, the plan provides 150 “anytime” minutes and 150 weekend minutes, with automatic addition of more minutes — if needed — in $10 increments.
The research firm Ovum says 17 million of the 185 million cellphone users in the United States are now on prepaid plans, and it forecasts that prepaid could become 25 percent of the market in 10 years. Rival research firm Yankee Group says 12 percent now have either prepaid or hybrid plans and predicts the combined number hitting 25 percent in just four years.
Three groups of people are candidates for prepaid phones:
• Parents buying for teens and preteens. Prepaid plans protect parents from runaway bills and can even be used as an incentive for good behavior: Take out the garbage every night this week and you’ll get more minutes. Teens also can learn responsibility by purchasing minutes from their allowance or from an after-school job.
• The credit-challenged. Immigrants and young people often lack the credit history required for a regular monthly cellphone plan.
• Light users. Cellphones are useful even if you talk only a few minutes a day, but regular plans can be unattractive to light users because they require buying five or more hours of talk time per month.
Prepaid plans, if you shop carefully, are usually less expensive for those who talk less than 200 to 300 minutes a month.
Heavy users, on the other hand, should stay away from prepaid. If you talk much more than 300 minutes a month, prepaid plans become prohibitively expensive.
There are also pitfalls with prepaid.
You can’t always tell which cellphone network is used by a prepaid plan, so you might wind up with a phone on a network with a weak signal in your neighborhood where other networks are strong.
Buying prepaid cards, either in the store or by phone or online, is more of a hassle than just paying a bill once a month.
Prepaid plans may charge extra for features such as voice mail, caller ID and text messaging that are included with regular monthly plans.
And most prepaid plans require you to keep buying more minutes, as often as once a month, to keep the account active, even if you’ve already got minutes to burn.
At least two carriers, however, offer a way out of frequent re-upping. TracFone sells a card for $89.99 that’s good for one year, and all minutes purchased for 7-Eleven’s Speak Out Wireless phones are good for 365 days.
One option for heavy talkers who don’t travel a lot are all-you-can-eat plans from MetroPCS and Cricket.
Looking forward, there will be new ways to hold down prepaid spending.
One example available now is CallWave Mobile , a new prepaid service launched Aug. 4. For a monthly fee of $3.95, users get call forwarding and call transfer.
This means you can switch a call in progress from your CallWave Mobile phone to your home phone or any other convenient land line, reducing your use of costly prepaid minutes.
Calls will also automatically ring through to another number you designate when the CallWave Mobile phone is turned off.