Other Upgrade Program or Purchase Outright

[John webstar44]

Outright all the way for me. £999 + £180 for my sim only contract with unlimited data and text minutes. £15 a month (1 year total cost £1179) (2 year total cost £1359)

Example UK prices showing Apple upgrade program £56.45 per month for a iPhone X 64GB + £69 upfront cost and you still need a sim card contract on top.
You could be talking around £56.45 + £20 sim only contract that around £76.45 a month working out around £986.4 whole year price.
Two years your paying around £1903.8

I'm Saving £544.8 for two years going sim free.

 

[Apple fanboy]

You are wrong on this one.

Time value of money (TVM) dictates that money available at the present time is worth more than the identical sum in the future.

Based on that, IUP is a no-brainier because at the least, you are beating inflation. Furthermore, If you choose to passively invest the £1000 at 10% per annum (which is totally doable), you would end up with £1210 in 2 years, covering the cost of AppleCare and then some.

If you are as financial savy as you make yourself to be, you should know that IUP is absolutely a no brainer, even if your net-worth is in the billions. I am just as much against accumulating debt as you are, but in this case, It is simply the correct financial decision to make. For the simple reason that you are offered financing and at 0% interest and 0 additional costs.

10% per annum? Care to share a link!

My lifestyle choice is to never have a loan, lease or credit card. It suits me. Your mileage might be different.

 

[blaugrana69]

Outright all the way for me. £999 + £180 for my sim only contract with unlimited data and text minutes. (1 year total cost £1179) (2 year total cost £1359)

Example UK prices showing Apple upgrade program £56.45 per month for a iPhone X 64GB + £69 upfront cost and you still need a sim card contract on top.
You could be talking around £56.45 + £20 sim only contract that around £76.45 a month working out around £986.4 whole year price.
Two years your paying around £1903.8

I'm Saving £544.8 for two years going sim free.

In the interests of fairness I think your maths are out (I should add that I buy outright and I’m not on the Upgrade Programme).
The iUP includes Apple Care retailing at £199 so you need to knock that off for comparison purposes. In addition iUP is over 20 months not 24. So after 20 payments, not 24, the phone belongs to you.

 

[John webstar44]

In the interests of fairness I think your maths are out (I should add that I buy outright and I’m not on the Upgrade Programme).
The iUP includes Apple Care +

To be honest that what I'm paying at the moment I keep my devices atleast two or three years max works out cheaper for me.
Better off paying bloody £76.45 or three uk wanted £90 iPhone X with all u can eat everything for 24 months £2160

I don't use Applecare never once smashed my screen so it's worthless for me.

 

[blaugrana69]

To be honest that what I'm paying at the moment I keep my devices atleast two or three years max works out cheaper for me.
Better off paying bloody £76.45 or three uk wanted £90 iPhone X with all u can eat everything for 24 months £2160

I don't use Applecare never once smashed my screen so it's worthless for me.

Without doubt the UK 24 month contracts work out considerably more than buying outright (I’m on a 3 Sim Only £15 per month deal - 12GB data, unlimited calls/texts). However my point was in relation to the iUP

 

[John webstar44]

Without doubt the UK 24 month contracts work out considerably more than buying outright (I’m on a 3 Sim Only £15 per month deal - 12GB data, unlimited calls/texts). However my point was in relation to the iUP

iUP is correct Upfront cost £69 iPhone X 64gb £56.45 ( £746.40) that with the upfront cost not including your £15 a month sim add your 12 month sim with it £926.4 1 year ownership.

 

[ANTAWNM26]

Unless your credit is shaky, adding a $50 payment is not going to effect your ability to get a mortgage. If your credit is that shaky, you probably shouldn't be buying a $1,000 phone.

Not your credit is shaky if say they are hard pulling not even a year out every time on top of other things you may have going on

 

[missbing]

Just curious but what is it about SquareTrade that you prefer? I have no experience with them but my sister swears by them for her family.

When I purchased SquareTrade last year for my iPhone X I got the 3 year protection plan for $159. AppleCare is $199 for 2 years. They cover everything AC covers and you can even take your phone to the Genius Bar and have SQ reimburse you if you don't want to send it into SQ or have SQ come to your house.

I just looked up current SQ prices and it looks like they updated their pricing structure for phones. It use to be $129/2 year and $159/3 year. Now they charge a monthly fee of $8.99, which is almost double what AC is, so I do not recommended SQ for phones any longer. It seems ridiculous that they nearly doubled their phone warranty prices. They have a chart that compares their new prices to different carrier warranties and compared to that it's cheaper, but compared to AC it's a lot more.

 

[Ermir444]

10% per annum? Care to share a link!

My lifestyle choice is to never have a loan, lease or credit card. It suits me. Your mileage might be different.

I work in the industry so 10% is rather conservative. I understand your choice and respect it. However, finacially speaking the UIP is the correct decision assuming you are finacially stable enough to buy it upfront. You should always use other peoples money, be it debt or equity, if it makes you more money.

 

[Deguello]

I work in the industry so 10% is rather conservative. I understand your choice and respect it. However, finacially speaking the UIP is the correct decision assuming you are finacially stable enough to buy it upfront. You should always use other peoples money, be it debt or equity, if it makes you more money.

In what industry do you work where a 10% riskless — because you’re doing the math like it’s riskless — return is rather conservative?

 

[Apple fanboy]

I work in the industry so 10% is rather conservative. I understand your choice and respect it. However, finacially speaking the UIP is the correct decision assuming you are finacially stable enough to buy it upfront. You should always use other peoples money, be it debt or equity, if it makes you more money.

No risk free savings or investments are delivering 10% imo.

I've heard you should use other people's money argument all my life. I'd just prefer to use my own. Too many people are have now pay later. Then they lose their job or some other circumstances change.
I'd rather not thanks. Just the way I am. And no offence, I've lived that way all my life. I'm not about to change now, and certainly not for an iPhone XS Max or whatever it's going to be called!

 

[Brenster]

On the upgrade program here in the UK. Got the iPhone X in Nov last year. Eligible for upgrade and starting a new 20 month term this December. Planning on carrying on until the agreement finishes whereupon I then own the phone outright.

Imnclusive Applecare is welcome (had to use AppleCare once on my then iphone 5J, and is effectively an all interest free way of buying the X.

 

[missbing]

In what industry do you work where a 10% riskless — because you’re doing the math like it’s riskless — return is rather conservative?

I work for a company that I'm able to buy company stock at a 15% discount, so when it comes time to sell (every 6 months) I make back a minimum of 15%. This is risk fee as long as you sell the day of stock purchase. Last 2 years my gain was 40%. A lot of big companies have these type of programs so that's a risk free way to use extra money to make money. Taking on debt with 0% interest allows me to take that extra money and invest, so I'm technically paying less than retail for that phone compared to buying it outright.

 

[Apple fanboy]

I work for a company that I'm able to buy company stock at a 15% discount, so when it comes time to sell (every 6 months) I make back a minimum of 15%. This is risk fee as long as you sell the day of stock purchase. Last 2 years my gain was 40%. A lot of big companies have these type of programs so that's a risk free way to use extra money to make money. Taking on debt with 0% interest allows me to take that extra money and invest, so I'm technically paying less than retail for that phone compared to buying it outright.

Sounds like a good deal. My company is privately owned. But not many places in the U.K. you can get a conservative 10% return on an investment. If any in fact.

 

[airjay75]

When I purchased SquareTrade last year for my iPhone X I got the 3 year protection plan for $159. AppleCare is $199 for 2 years. They cover everything AC covers and you can even take your phone to the Genius Bar and have SQ reimburse you if you don't want to send it into SQ or have SQ come to your house.

I just looked up current SQ prices and it looks like they updated their pricing structure for phones. It use to be $129/2 year and $159/3 year. Now they charge a monthly fee of $8.99, which is almost double what AC is, so I do not recommended SQ for phones any longer. It seems ridiculous that they nearly doubled their phone warranty prices. They have a chart that compares their new prices to different carrier warranties and compared to that it's cheaper, but compared to AC it's a lot more.

Interesting article here about SquareTrade: http://www.chicagobusiness.com/arti...paid-1-4-billion-for-money-losing-squaretrade

In the past, SquareTrade was definitely a better deal than AppleCare if you decided you needed insurance on your iPhone. I haven’t spent much time crunching the numbers, but I think I’d go with AppleCare over SquareTrade now. Of course, I still think AppleCare or SquareTrade is too expensive for what you’re insuring - unless you are fairly certain you will break your screen or otherwise significantly damage your phone, I just don’t personally think it’s worth it. Even then it’s more like a pre-paid repair program than it is insurance IMO.

 

[Deguello]

I work for a company that I'm able to buy company stock at a 15% discount, so when it comes time to sell (every 6 months) I make back a minimum of 15%. This is risk fee as long as you sell the day of stock purchase. Last 2 years my gain was 40%. A lot of big companies have these type of programs so that's a risk free way to use extra money to make money. Taking on debt with 0% interest allows me to take that extra money and invest, so I'm technically paying less than retail for that phone compared to buying it outright.

Well, if you’re talking about an ESPP then your stock contributions aren’t going to be in a lump sum, they’re going to be periodic (based on your pay schedule). Unless paying for the phone upfront somehow doesn’t leave you enough money to afford the periodic contributions, whether the $X goes to a phone payment or a contribution towards buying discounted stock, you’re still out of pocket the same.

That is, paying for the phone up front wouldn’t keep you from also buying the stock. Since money is fungible, it really doesn’t make any difference whether you buy the phone lump sum or not, unless, again, buying the phone upfront meant you couldn’t afford the stock. If you cans afford both, it’s a wash.

 

[Ermir444]

In what industry do you work where a 10% riskless — because you’re doing the math like it’s riskless — return is rather conservative?

When did I say riskless? Google the difference between riskless and conservative.
[doublepost=1536293178][/doublepost]

No risk free savings or investments are delivering 10% imo.

I've heard you should use other people's money argument all my life. I'd just prefer to use my own. Too many people are have now pay later. Then they lose their job or some other circumstances change.
I'd rather not thanks. Just the way I am. And no offence, I've lived that way all my life. I'm not about to change now, and certainly not for an iPhone XS Max or whatever it's going to be called!

Again, there is a big difference between riskless and conservative. S&P500 has returned about 10% on average for the past 10 years and about 9.8% since its inception. You can just buy and hold the SPY ETF. Furthermore, assuming you are investing for value, there are thousands of companies (especially commodity producers) that pay divident 8-12% per annum. And these are in equities only. 10% is not as hard as you think.

Im not disputing you world view regarding debt, only your agument that IUP is a mistake.

 

[Deguello]

When did I say riskless? Google the difference between riskless and conservative.

Well, if you’re talking about using investment money in this context, it needs to be riskless or your scenario makes no sense.

But the point still stands: there’s no 10% conservative investment, either.

Edit: With the exception of ESPP or the like.

 

[-C-]

For the longest time I was on the two year upgrade program when I bought the iPhone 3G, 4, 5 and then the last one I got was the 6 in 2014...that one is in pretty rough shape today but, to be honest, I'd be fine with it for another 4 years if I could get the battery replaced because the primary function of these things for me was met 4 years ago and not a lot has changed.

This upgrade program seems like a decent deal, really, however I think the real reason it exists is that they'd like to encourage more of that 'addicted to upgrade' behavior that's been tapering off for a while. Take advantage of it if you can but don't get caught up or else it turns into a bad deal.

 

[Ermir444]

Well, if you’re talking about using investment money in this context, it needs to be riskless or your scenario makes no sense.

But the point still stands: there’s no 10% conservative investment, either.

Edit: With the exception of ESPP or the like.

About the only certain thing is death, everything else has risk. Your point does not stand. As I said above, they are many dividend stocks, REITs and mutual funds offering comfortably 8-12%

 

[craigio85]

Without doubt the UK 24 month contracts work out considerably more than buying outright (I’m on a 3 Sim Only £15 per month deal - 12GB data, unlimited calls/texts). However my point was in relation to the iUP

Your point about the iUp was wrong. Firstly you worked it out over two years, not 20 months. Then you inexplicably added £5 per month to the SIM only cost for comparison. This caused you to arrive at the baffling conclusion that you’re saving north of £500 by buying outright.

The iUp with a SIM only contract is more expensive than buying outright and using a SIM only contract by exactly £199 - the cost of the AppleCare+. That’s the exact amount you’ve saved and it isn’t even really fair to say it’s a saving because that’s the cost of a service. Which, incidentally, is optional as users can exclude this and use iPhone Payments plan instead which is the exact same cost as buying outright. The only routes of buying an iPhone that significantly bump the cost is any form of finance which charges interest or taking a contract with a network provider which bundles in the cost of the device.

As for the question the thread asks - I’ve previously bought outright, but this year I’m going to opt for iPhone Upgrade programme.

 

[blaugrana69]

Your point about the iUp was wrong. Firstly you worked it out over two years, not 20 months. Then you inexplicably added £5 per month to the SIM only cost for comparison. This caused you to arrive at the baffling conclusion that you’re saving north of £500 by buying outright.

The iUp with a SIM only contract is more expensive than buying outright and using a SIM only contract by exactly £199 - the cost of the AppleCare+. That’s the exact amount you’ve saved and it isn’t even really fair to say it’s a saving because that’s the cost of a service. Which, incidentally, is optional as users can exclude this and use iPhone Payments plan instead which is the exact same cost as buying outright. The only routes of buying an iPhone that significantly bump the cost is any form of finance which charges interest or taking a contract with a network provider which bundles in the cost of the device.

As for the question the thread asks - I’ve previously bought outright, but this year I’m going to opt for iPhone Upgrade programme.

True but Not my maths !! I was replying to john webstar44 - he hadn’t factored in Apple Care as you state, I pointed out that it’s £199 so he needs to subtract that for a fair comparison and the iUP is over 20 months not 24 (payments).

 

[craigio85]

True but Not my maths !! I was replying to john webstar44 - he hadn’t factored in Apple Care as you state, I pointed out that it’s £199 so he needs to subtract that for a fair comparison and the iUP is over 20 months not 24 (payments).

Apologies - I quoted the wrong post!

 

[Krayzkat]

You are wrong on this one.

Time value of money (TVM) dictates that money available at the present time is worth more than the identical sum in the future.

Based on that, IUP is a no-brainier because at the least, you are beating inflation. Furthermore, If you choose to passively invest the £1000 at 10% per annum (which is totally doable), you would end up with £1210 in 2 years, covering the cost of AppleCare and then some.

If you are as financial savy as you make yourself to be, you should know that IUP is absolutely a no brainer, even if your net-worth is in the billions. I am just as much against accumulating debt as you are, but in this case, It is simply the correct financial decision to make. For the simple reason that you are offered financing and at 0% interest and 0 additional costs.

10% per annum? Care to share a link!

My lifestyle choice is to never have a loan, lease or credit card. It suits me. Your mileage might be different.

It would actually be WAY higher than a mere 10% interest rate per annum he’d be earning if he ends up with £1210 after 2 years, as the original £1000 is being depleted every month by whatever the monthly payment is, ie so after 12 months of payments the original £1000 he had stashed away earning huge amounts of interest would be depleted to £500 (plus whatever interest it’s gained in that period).

I can’t be bothered to do the maths.....

 

[Ermir444]

It would actually be WAY higher than a mere 10% interest rate per annum he’d be earning if he ends up with £1210 after 2 years, as the original £1000 is being depleted every month by whatever the monthly payment is, ie so after 12 months of payments the original £1000 he had stashed away earning huge amounts of interest would be depleted to £500 (plus whatever interest it’s gained in that period).

I can’t be bothered to do the maths.....

You are assuming he is using the original 1k to pay for the installments which is not correct. If all you have is 1k you shouldn't be buying an X in the first place.