Should You Buy a One Year Prepaid Wireless Plan?

YouTuber, Santos Prod, asks…

Would it be wise to buy a 1 yr pre paid card instead of monthly?

Santos wants to know whether or not it’s a good idea to buy a Straight Talk 1 Year service card, or is it better to pay monthly.

For those of you unfamiliar with it Straight Talk sells a one year service card for $495. When you buy this plan you are prepaying for one year or 12 $45 Unlimited, Talk, Text, and 25GB of data monthy plans in advance. The 25GB plan cost $45 monthly, if you buy the yearly plan, it comes out to $41.25 per month, or a $45 per year savings.

Before answering I am going to assume that you have decided that Straight Talk is the right wireless service for you in terms of network coverage, price, and features.

My initial reaction would be to say no, don’t sign up for a one year plan but you really need to decide if the savings make sense for you.

On the downside, you’ll be prepaying for one year of service in advance, effectively locking you into using Straight Talk for one year. If you are new to Straight Talk, it’s not a good idea to prepay that far in advance for a service you are not sure you will be happy with. Second, if your needs change over the next year, you cannot change plans. Suppose you take a new job, and they give you a phone to use with unlimited data. You may find you don’t need to be paying for 25GB per month on your personal phone. Or maybe you are traveling for a new job and find out you need your personal plan to have unlimited data, but you are stuck with 25 GB. Perhaps you decide to move outside the US or move to any area with no cellular coverage. You have already paid for service.

However, prepaying for the one year plan can make sense in some circumstances. With the yearly plan the $45 savings is like getting one month for free. One way to think about your phone service is how much is it going to cost you for the year for phone and plan, and $45 is a 8% savings on plans for the year. Also depending on your finances you may decide its easier to make one yearly payment instead of 12 monthly payments for service.

You may also see additional savings if you buy the yearly plan card online or a retail store as you may just pay sales tax on the plan and avoid the other taxes and fees you are charged when you pay Straight Talk online with your credit card.

If you decide to buy a smartphone from Straight Talk directly, you are already committing to use Straight Talk for 12 months. Straight Talk phones are activation locked and can only be used with Straight Talk. After you use the phone with Straight Talk for 12 months, they will unlock the phone for free and you can use it with a different wireless service.

If you decide to buy a phone for someone else as a gift or to help them out you might want to include one year of service with the phone. I heard from a number of readers that want to give someone an iPhone or Galaxy phone as a gift. You can include one year of service with the phone and after that, your personal commitment is done. The giftee can choose to continue to pay for Straight Talk service themselves or unlock the phone and take it to another service. This is also a really nice way to transition adult children off your wireless bill. Give them a new phone for high school or college graduation with one year of service. The same holds true if you are trying to help a family member or friend get back on their feet by providing them a phone. You can help them out for a year, without a further commitment.

I hope this helps, Santos.

What about you? Are you considering a one year prepaid plan? Leave a reply below and share.

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