Mobile phone plans buying guide

Confused by the ins and outs of mobile call plans? Our guide can help you.
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02.Plan or prepaid

Do you want to commit yourself to a postpaid service with regular bills, or would you be better off with a prepaid service?

Postpaid plan

  • Fixed-term contracts or plans range from one month to 24 months (or occasionally even more), and have a minimum monthly service charge, which usually includes a certain value of calls. They may (but don’t necessarily) include the cost of a handset.
  • Postpaid plans tend to have cheaper call rates, especially for medium- and higher-usage plans.
  • Costs can escalate out of control — something to consider if you’re on a tight budget. Some services offer bill capping (where you nominate a maximum monthly spend), although the minimum cap we found is still quite high.
  • Some carriers have unlimited capped plans. A higher monthly fee allows you unlimited usage (within the fair use policies of the carrier).
  • If you want to quit a plan early, there may be penalty exit fees.
  • If your plan includes a number of call credits and you overestimate your mobile usage, you won’t use them up; if you underestimate you may end up paying higher per-minute call rates than you would on a heavier-use plan. A tip is to use a prepaid plan first to check your usage.
  • Before signing up to a long-term plan, think about the length of commitment and minimum total costs; find out if a handset is included in the cost or if it’s extra; establish the costs and penalties involved in paying the plan out early, and whether you can change to a higher- or lower-usage plan at any stage.


  • With prepaid you buy a starter kit (with or without a handset), which gives you access to the phone network and a dollar amount of call credits. When that runs out, you can ‘recharge’ your call credits and extend network access.
  • A prepaid service gives you tight control over call expenditure, and is ideal if you’re watching your budget or if the phone’s for a youngster. Be careful using 0055 numbers, as these use up future credit. You could end up in a situation of topping up your phone just to pay off the charges you have already been billed and be left without any credit.
  • If this is your first mobile phone, using a prepaid plan will give you a rough idea of how much you’ll use it, so you can estimate more accurately the best service (pre- or postpaid) for the longer term.
  • Prepaid tends to be the cheapest option for people who don’t make many calls.
  • Even if you don’t have any call credits remaining, you can still use the phone to make 000 calls and receive calls for a limited time (possibly up to 12 months — ask providers for details).
  • You won't receive a bill. However, you can check your call credit status at any time (usually via a free-call number), and receive reminders (beep or message) when you're getting low on credit.
  • The call credits may expire after a certain time, so use ’em or lose ’em. Some carriers allow you to carry over unused credits for up to 12 months such as Vodaphone and its resellers.
  • International roaming isn’t available from all providers. An alternative with GSM phones is to buy a prepaid SIM when you get there, which may be cheaper than roaming anyway, although you’ll have a different number.
  • If you want to go to another network, you may have to pay what amounts to an exit fee (ostensibly a fee for removing SIM security locks). Different networks have different policies — check before you buy.
  • Look into how and where you can recharge your call credits (with many you can recharge over the phone or web; other ways include going to a dealer outlet, service station, convenience store or ATM); how long the credits are valid; and the minimum recharge amount.
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