Carrier Dislike EIP and down payments

[Tthomas612]

i know some will flame me for this and some will agree, but I honestly hate this new way of buying phones.

At first I liked it then not so much...

I remember the days of walking in paying $199.99 and walking out with your new flagship device. Of course it was on 2 year contract, but a lot of places would still let you upgrade the next year for $450 down and another 2 year contract.

I was behind a person the other day in line and there down payment for a Galaxy S8 Plus was $649 DOWN... ok well I Might as well just go buy the phone unlocked now ...

I know it’s based off people’s credit, but something’s in me tell me it’s just wrong ... just wrong... I also know it means there monthly device payment willbe lower, but still $650 down??

Some days I just wish they’d bring back 2 year contracts

 

[eyoungren]

The problem with two year contracts though was that they masked the true cost of the phone. And with the price of the phone being built into the contract you ended up paying the full cost of the phone anyway. Go past two years and the phone was yours of course, but the price of the plan didn't change and now you're paying subsidy on a phone you've already paid off.

I can agree with you on leasing. I don't particularly care for the idea of paying all that money but the carrier owns the phone. But leasing is attractive to some because it allows upgrades (depending on the plan you may be on).

I prefer EIP. I'm paying for it monthly, but I know it's being paid off. Our iPhones were leased and our iPads were on EIP. The iPads will be paid off three months before the iPhones (we used the purchase option for the iPhones).

I guess too it depends on your purchasing habits. I can see your point if you (you in general, not specifically you) are one of those types that upgrades multiple times per year.

 

[Tthomas612]

The problem with two year contracts though was that they masked the true cost of the phone. And with the price of the phone being built into the contract you ended up paying the full cost of the phone anyway. Go past two years and the phone was yours of course, but the price of the plan didn't change and now you're paying subsidy on a phone you've already paid off.

I can agree with you on leasing. I don't particularly care for the idea of paying all that money but the carrier owns the phone. But leasing is attractive to some because it allows upgrades (depending on the plan you may be on).

I prefer EIP. I'm paying for it monthly, but I know it's being paid off. Our iPhones were leased and our iPads were on EIP. The iPads will be paid off three months before the iPhones (we used the purchase option for the iPhones).

I guess too it depends on your purchasing habits. I can see your point if you (you in general, not specifically you) are one of those types that upgrades multiple times per year.

For me I agree to an extent, but I did feel bad for them lol

 

[bufffilm]

The problem with two year contracts though was that they masked the true cost of the phone. And with the price of the phone being built into the contract you ended up paying the full cost of the phone anyway. Go past two years and the phone was yours of course, but the price of the plan didn't change and now you're paying subsidy on a phone you've already paid off.

I can agree with you on leasing. I don't particularly care for the idea of paying all that money but the carrier owns the phone. But leasing is attractive to some because it allows upgrades (depending on the plan you may be on).

I prefer EIP. I'm paying for it monthly, but I know it's being paid off. Our iPhones were leased and our iPads were on EIP. The iPads will be paid off three months before the iPhones (we used the purchase option for the iPhones).

I guess too it depends on your purchasing habits. I can see your point if you (you in general, not specifically you) are one of those types that upgrades multiple times per year.

It really depends on the plan you are on.

When Verizon ended the subsidized phone earlier this year, it hurt me.

Because as a longtime Verizon customer, I'm in already on a plan where my monthly cost can't be lowered (the difference is about a $1 cheaper).

Ymmv.

 

[eyoungren]

It really depends on the plan you are on.

When Verizon ended the subsidized phone earlier this year, it hurt me.

Because as a longtime Verizon customer, I'm in already on a plan where my monthly cost can't be lowered (the difference is about a $1 cheaper).

Ymmv.

Yeah, I guess it's just me. When I see subsidized I see 'locked in'. And that's not something I care for, even if I don't plan to leave.

There were only two choices when we ported to T-Mob though and I wanted out of Sprint so I went with whatever the rep signed me up on (within my request).

This year, I plan to just buy outright. We will finally have gotten the bill down once EIP is removed and I have no desire to jack it back up again after two years of ~$300 cell phone bills.

 

[Tthomas612]

Yeah, I guess it's just me. When I see subsidized I see 'locked in'. And that's not something I care for, even if I don't plan to leave.

There were only two choices when we ported to T-Mob though and I wanted out of Sprint so I went with whatever the rep signed me up on (within my request).

This year, I plan to just buy outright. We will finally have gotten the bill down once EIP is removed and I have no desire to jack it back up again after two years of ~$300 cell phone bills.

I realize that signing a 2 year contract makes it feel as if you’re trapped. This is part of the reason why most carriers went away from this 2 year stuff, but the worst thing is those down payments.

One of the things is that if I go in and have to pay $650 down for a phone then it still makes me trapped into something... because paying $650 down and it’s technically not even my phone yet... so now I’m paying $4 a month because my down payment was so big, but what happens when I can’t pay my bill?

I’m not saying me specifically... my down payments are low and my monthly payments are higher, but there are people out there that will still get trapped into this because theyve already paid so much down on the phone...

It sucks, but 2 year contracts suck too... I know it’s going to suck either way, but I still do believe they should give options at times... especially when someone’s down payment is $650 lol

 

[snow755]

i know some will flame me for this and some will agree, but I honestly hate this new way of buying phones.

At first I liked it then not so much...

I remember the days of walking in paying $199.99 and walking out with your new flagship device. Of course it was on 2 year contract, but a lot of places would still let you upgrade the next year for $450 down and another 2 year contract.

I was behind a person the other day in line and there down payment for a Galaxy S8 Plus was $649 DOWN... ok well I Might as well just go buy the phone unlocked now ...

I know it’s based off people’s credit, but something’s in me tell me it’s just wrong ... just wrong... I also know it means there monthly device payment willbe lower, but still $650 down??

Some days I just wish they’d bring back 2 year contracts

same thing was for me when i had them i had too pay a large lump sum too buy there phones but i switch over too verizon and i only had too pay Taxs on my phone with 0 down payment so if puting down a large lump sum is not your idea then i would look in too verizon and see if you can do a 0 down payment plan all they need too do is run a credit check

 

[eyoungren]

I realize that signing a 2 year contract makes it feel as if you’re trapped. This is part of the reason why most carriers went away from this 2 year stuff, but the worst thing is those down payments.

One of the things is that if I go in and have to pay $650 down for a phone then it still makes me trapped into something... because paying $650 down and it’s technically not even my phone yet... so now I’m paying $4 a month because my down payment was so big, but what happens when I can’t pay my bill?

I’m not saying me specifically... my down payments are low and my monthly payments are higher, but there are people out there that will still get trapped into this because theyve already paid so much down on the phone...

It sucks, but 2 year contracts suck too... I know it’s going to suck either way, but I still do believe they should give options at times... especially when someone’s down payment is $650 lol

Yes, in a sense I will also be trapped when I go out any buy our next new phones this year. We will be trapped with that particular phone and whatever carrier it operates on.

However, as you know, we don't upgrade very often. While I am going to be in a cage (the phone and it's price) I'd like to be able to choose WHICH cage (the carrier). I'd rather not be owing the carrier any money.

I get where you're coming from. It sucks to have to pay out that much just to upgrade.

 

[Strelok]

I did the calculations back in 2013 or 2014 and the monthly payments ended up being cheaper than a subsidized plan over the 2 years. This was on Verizon and you received a $20-$25 discount for going with monthly payments versus contract, so that also helped.

 

[Apple_Robert]

Either buy the phone outright on a credit card, and make sure to pay off the balance right away, or save up the cash and make the purchase,. Problem solved.

 

[eyoungren]

Either buy the phone outright on a credit card, and make sure to pay off the balance right away, or save up the cash and make the purchase,. Problem solved.

We usually just get ours with our tax refund every 2 to 3.5 years.

 

[Apple_Robert]

We usually just get ours with our tax refund every 2 to 3.5 years.

That plans works as well. Only problem is a big tax refund lets you know that you gave the gubmint interest free access to your money for the year.

 

[Strelok]

Either buy the phone outright on a credit card, and make sure to pay off the balance right away, or save up the cash and make the purchase,. Problem solved.

If you get a 2 year 0% loan, you would be crazy to to pay it upfront. Keep in mind your $650 (or however much you spend) is worth more today than it is next year.

 

[Apple_Robert]

If you get a 2 year 0% loan, you would be crazy to to pay it upfront. Keep in mind your $650 (or however much you spend) is worth more today than it is next year.

I agree with you. However, the OP made it known his dislike for carrier financing. Hence my reply.

 

[eyoungren]

That plans works as well. Only problem is a big tax refund lets you know that you gave the gubmint interest free access to your money for the year.

Well…not really. At least with us anyway.

The government doesn't care what you label yourself during the year as long as you pay the appropriate tax at the end of the year.

I (and my wife when working) declare tax exempt on our W2s. That gives us our full paychecks (minus FICA and the min. state tax). At the end of the year, I claim the correct exemptions.

That, of course, results in tax owed. But we both had/have student loans. The interest on the loans zeros our tax owed. With the credits we are entitled to (child and work credits) that's how we get a refund.

Without doing it this way we we'd be in a very difficult spot each paycheck.

 

[maxjohnson2]

I think EIP is just a continuation of contracts, if anything I think people are paying more now. American public lives on credit and they still can't accept true price of phones.

 

[Tthomas612]

I agree with you. However, the OP made it known his dislike for carrier financing. Hence my reply.

Well it is a dislike for it, but not because of me. I mean I get my phones either out right or I end up paying $0 to very little out of pocket...

I just believe that after what I saw the other night that it gives people more of a choice to have 2 year contracts. I understand that 2 year contracts end up costing more in the long run, but some
People have trouble coming up with $650 OOP for a device. I also realize that it’s there choice and they don’t have to upgrade to the latest and greatest, but these people were upgrading from a Samsung Galaxy S3 to a Galaxy S8 Plus.

So it’s not like they’re upgrading yearly...

 

[Strelok]

If you don't know how to play the credit system, that is kind of your own fault. There are many resources out there that explain how to get a good credit score. If you want cheap payments you'll have to work for it a bit.

 

[Apple_Robert]

Well it is a dislike for it, but not because of me. I mean I get my phones either out right or I end up paying $0 to very little out of pocket...

I just believe that after what I saw the other night that it gives people more of a choice to have 2 year contracts. I understand that 2 year contracts end up costing more in the long run, but some
People have trouble coming up with $650 OOP for a device. I also realize that it’s there choice and they don’t have to upgrade to the latest and greatest, but these people were upgrading from a Samsung Galaxy S3 to a Galaxy S8 Plus.

So it’s not like they’re upgrading yearly...

You are right. There are a lot of people who struggle to make payments or pay out of pocket for an item. In my opinion, if a person has trouble making a monthly payment for something like a phone, said person is probably living beyond his or her financial means.

One of the biggest problems I see with today's generation, is that they have the notion, that they are entitled to x,y, and Z, just because they want x,y, and z. Many don't consider the cost down the line. And when things get financially tight, they make excuses or continue to cling to their $1,000 satin sheets on a $100 income hoping that their entitlement mentally will get them through the night.

There are lot more important things in this life than Apple and its products. There are a lot of self-absorbed people on this forum who have equated self-worth and inner peace with having the latest and greatest Apple products, regardless of the cost. And one day, they will wake from their shallow slumber and realize that with all their gadgets that they shouldn't have bought at the time, that they are as empty inside as ever.

 

[Tthomas612]

You are right. There are a lot of people who struggle to make payments or pay out of pocket for an item. In my opinion, if a person has trouble making a monthly payment for something like a phone, said person is probably living beyond his or her financial means.

One of the biggest problems I see with today's generation, is that they have the notion, that they are entitled to x,y, and Z, just because they want x,y, and z. Many don't consider the cost down the line. And when things get financially tight, they make excuses or continue to cling to their $1,000 satin sheets on a $100 income hoping that their entitlement mentally will get them through the night.

There are lot more important things in this life than Apple and its products. There are a lot of self-absorbed people on this forum who have equated self-worth and inner peace with having the latest and greatest Apple products, regardless of the cost. And one day, they will wake from their shallow slumber and realize that with all their gadgets that they shouldn't have bought at the time, that they are as empty inside as ever.

Yes this I agree on100%. People do live beyond there means EVERYDAY.

Which probably makes my disdain for leasing phones mute. My whole thing is more people afford $199 before they can afford $650. However if a person is having a down payment of $650 said person may not need said device in the first place...

I think I’m more at odds then a dislike ..

 

[Reno Raines]

The problem with two year contracts though was that they masked the true cost of the phone. And with the price of the phone being built into the contract you ended up paying the full cost of the phone anyway. Go past two years and the phone was yours of course, but the price of the plan didn't change and now you're paying subsidy on a phone you've already paid off.

I can agree with you on leasing. I don't particularly care for the idea of paying all that money but the carrier owns the phone. But leasing is attractive to some because it allows upgrades (depending on the plan you may be on).

I prefer EIP. I'm paying for it monthly, but I know it's being paid off. Our iPhones were leased and our iPads were on EIP. The iPads will be paid off three months before the iPhones (we used the purchase option for the iPhones).

I guess too it depends on your purchasing habits. I can see your point if you (you in general, not specifically you) are one of those types that upgrades multiple times per year.

I agree wholeheartedly. We do EIP for my wife's phone and it is nice knowing we can pay it off early or just do the monthly payments and when it is paid off our bill goes down. We use T Mobile and I also like how they separate the cost of the phone from the actual cost of the carrier plan. I usually just save up my money and buy a phone outright but the EIP works great for my better half. I never liked the idea of a two year contract whereby even after the two years were up, I was still paying the same for my service even when still using my old phone. Just my opinion but I like the transparency. I think this was the best uncarrier move T Mobile ever did.

 

[democracyrules]

Either buy the phone outright on a credit card, and make sure to pay off the balance right away, or save up the cash and make the purchase,. Problem solved.

Agree with the above comment. Excellent and wise advice. I always buy my phone outright because of the freedom I can have if wanting to change carrier without any troubles of going any processes. Also, I can keep my phone too, not lease it.
[doublepost=1497193112][/doublepost]

You are right. There are a lot of people who struggle to make payments or pay out of pocket for an item. In my opinion, if a person has trouble making a monthly payment for something like a phone, said person is probably living beyond his or her financial means.

One of the biggest problems I see with today's generation, is that they have the notion, that they are entitled to x,y, and Z, just because they want x,y, and z. Many don't consider the cost down the line. And when things get financially tight, they make excuses or continue to cling to their $1,000 satin sheets on a $100 income hoping that their entitlement mentally will get them through the night.

There are lot more important things in this life than Apple and its products. There are a lot of self-absorbed people on this forum who have equated self-worth and inner peace with having the latest and greatest Apple products, regardless of the cost. And one day, they will wake from their shallow slumber and realize that with all their gadgets that they shouldn't have bought at the time, that they are as empty inside as ever.

Agree with the above comments. Very wise. However, remember, today's generation is a product of previous generation who created them, their parents and their parenting.

 

[ftaok]

Well…not really. At least with us anyway.

The government doesn't care what you label yourself during the year as long as you pay the appropriate tax at the end of the year.

I (and my wife when working) declare tax exempt on our W2s. That gives us our full paychecks (minus FICA and the min. state tax). At the end of the year, I claim the correct exemptions.

That, of course, results in tax owed. But we both had/have student loans. The interest on the loans zeros our tax owed. With the credits we are entitled to (child and work credits) that's how we get a refund.

Without doing it this way we we'd be in a very difficult spot each paycheck.

I was about to flame you for "bragging" about getting a tax refund, but then I read this post. Now I see what you're doing. I don't think I would have had the guts to declare tax-exempt like that, but I like your style.

It would be even better if you could claim the credits on your paychecks and get your tax refund over the course of the year.

Bravo man!
[doublepost=1497205666][/doublepost]

If you get a 2 year 0% loan, you would be crazy to to pay it upfront. Keep in mind your $650 (or however much you spend) is worth more today than it is next year.

For me, I use a credit card that gives me an extra 2 years on the warranty. And that's on top of AppleCare, if I choose to purchase it.

If I were to go with the zero-down zero-percent type plans, I wouldn't get that credit card perk. To me, the peace of mind of having an extended warranty beats the benefit of a 0% loan on a $700 item.

 

[Strelok]

You can go through the iPhone upgrade program and get AppleCare thrown in there.

 

[AZhappyjack]

Well…not really. At least with us anyway.

The government doesn't care what you label yourself during the year as long as you pay the appropriate tax at the end of the year.

I (and my wife when working) declare tax exempt on our W2s. That gives us our full paychecks (minus FICA and the min. state tax). At the end of the year, I claim the correct exemptions.

That, of course, results in tax owed. But we both had/have student loans. The interest on the loans zeros our tax owed. With the credits we are entitled to (child and work credits) that's how we get a refund.

Without doing it this way we we'd be in a very difficult spot each paycheck.

This is not entirely true. It works in your case because of the other deductions to reduce your overall tax... but for those who will end up owing large amounts using this method, the government will also add on an "underpayment penalty". The general rule is that an "underpayment penalty" is waived when the taxpayer owes less than $1000 or the taxpayer has paid (via withholding and/or estimated payments) 90% of the total taxes due. (source).

As with most tax situations, YMMV, but offering generic statements/advice like the one quoted above, it not a good idea... especially for one who is not a "tax professional".

I don't mean to take this thread too far off topic... but given the earlier statement about many living beyond their means and not understanding how "credit" works (beyond "free" now, pay later, sometimes forever), it was something that needed to be mentioned.