Buying a mobile
Entering the phone zone
It's hard to imagine life without a mobile phone, but it can
cost you a bomb if you buy the wrong phone or plan. Follow our tips
to get a mobile phone deal you can afford and how to
keep your phone safe.
How much can you afford?
Play it safe and work out your budget before you shop. Add up
what you earn, subtract what you spend on rent, food, bills,
petrol, fares and any other regular expenses. The money left over
can be spent on things you want, including your mobile. Use our
budget planner to help.
Know your limits so you don't end up in debt. If you don't pay
your mobile bills on time you could end up with a poor credit
rating and even have problems getting a loan in the future.
Case study: Vinh's 'free' phone on a 'capped' plan
Vinh, 18, desperately
wanted to get rid of the pre-paid mobile his mum gave him when he
was 15. One phone shop offered him a free phone on a 24-month
contract for $29 per month that would give him calls and texts
worth $150 each month. (This is called a $29 cap plan.)
When Vinh got his first bill, it was $160 because he had more
calls than were covered by his cap. The next bill was $170 because
Vinh had browsed the web on his phone, but data downloads were not
included in his plan.
Vinh fell behind with his payments. He got an overdue notice and
then a disconnection notice that included a $400 early
(contract) termination fee. Finally, a debt collector visited
him, asking for $700.
'I didn't know what to do. I ended up calling the
Telecommunications Industry Ombudsman. They helped me to get the
termination fee waived, but I still had to borrow money from my dad
to pay for the rest. It was really messy. I got a default listing
on my credit report for not paying… which might be a problem when I
try to get a credit card or even a mortgage. I'm really careful
with my mobile now.'
Choose a mobile phone
With so many mobile and plan options, take the time to look
around online and in the shops until you find the mobile phone you
want for the price you're after.
Don't rely on the salesperson to tell you everything: read your
mobile phone contract yourself. It will become the official record
of your deal. Only sign when you fully understand what you are
getting. Ask your parents, or someone with experience, for help if
there's something you don't understand.
What features do you really need?
The more features a phone has, the more it will cost. Consider
- Do you really need the maximum memory capacity, Bluetooth,
infrared and extra accessories (hands-free, car kit,
- How much data do you need to download per month?
Remember, call plan features - like voicemail, internet data and
roaming - can still cost money each time you use them. Ringtones
and downloads seem cool in the ads but they will cost extra.
Ask your provider if you are being charged for any premium or
paid services. In NSW, one in five people aged between 12 and 20
has been charged for a mobile phone service they did not know they
had signed up for.
Be really careful before signing up to deals that offer 'free
ringtone downloads' or 'free SMS competitions'. Many people get
slugged with unexpected charges. See SCAMwatch: Mobile phone scams.
What about coverage?
Not all mobile phone providers have good coverage outside major
cities. Ask to see coverage maps so you can check the areas that
have no coverage.
Decide on a pre-paid plan or a
Pre-paid means you buy 'credit' to pay for calls and services
before you use them. This can make your calls more expensive but is
a great way to make sure you don't get into debt. Once you've used
up your credit, you can't make any more calls until you put more
money on your phone.
If you buy a pre-paid phone, you might find that
your mobile service provider has locked your phone's SIM
card to their network. This means you might have to pay up to $150
to 'unlock' the phone if you switch to another mobile service
Before you sign, find out how much it costs to get out of the
contract early. It can cost up to $150 to unlock your phone if you
switch service providers.
When you sign up to a mobile phone contract, you usually have to
choose a 'cap'. A cap is the amount you pay each month to make
calls, send texts, browse for data and use the other services on
If you continually go over your cap, then depending on the rates
for your mobile contract, it would probably be cheaper for you to
increase your cap than to pay for the extra each month.
To get the right contract and choose the best capped plan for
you, work out:
- How many calls you would make in a month
- How long your calls usually last
- What time you usually make calls (e.g. before and after school
Most contracts are for 12, 24 or 36 months. You get a network
connection, a handset and a number of free calls, texts and
downloads each month. In return, you pay:
- An access charge
- A 'flag charge' (a call connection fee) on each call
- Timed call costs (a charge based on how long your call lasts
e.g. $1 for every 30 seconds)
Usually plans with high access charges have lower call costs.
Plans that charge calls per second instead of in 30-second blocks
can also save you money.
If you already own a handset you can pay month-by-month without
signing a long-term contract. Calls are usually cheaper if you make
them in off-peak times. Look up the cheaper times on your call
charges schedule and make your calls at these times.
Decide on warranty and
When you buy a new phone you have the basic consumer right to a
phone of acceptable quality. If your new phone is faulty or doesn't
work, you have the right to get it repaired or replaced, or to get
a refund, depending on the situation. Keep your receipts and
network service connection agreement as proof of purchase.
Some stores may suggest you buy an 'extended warranty': an
additional warranty that covers you for repairs and maintenance for
a given period. But be aware that this may not give you any more
rights than you have already. If you're thinking about an extended
warranty, check the service agreement and conditions to see where
you have to take the phone for repairs, and if it covers spare
parts, labour and a replacement phone.
Insurance is optional. It usually covers loss, accidental damage
and theft but may not cover you if your phone is stolen when you
leave it unattended. Find out more about mobile phone
Keeping your mobile safe
Once you buy a mobile you should treat it like your wallet and
keep it safe. If someone steals your phone they can get more
information from it than they can from your wallet.
Here are some things you can do to protect your mobile:
- Don't leave your mobile phone lying around in plain sight. Keep
it as safe as you would your wallet.
- Don't save passwords on your phone. Try to create passwords
that you can remember but no one else can work out.
- Activate the password or PIN security on your mobile.
- Use mobile networks rather than free wireless when accessing
your bank accounts.
- Always check the authenticity of the site - a smaller screen
can make it hard to identify fake sites.
- Check your phone and bank statements for any unusual charges in
case someone has accessed your mobile without you knowing.
If you have problems with
If your phone isn't working, contact:
- The store that sold you the phone or your network provider to
try and sort out the problem.
- The fair trading or consumer affairs office in your state or
territory if you have problems with the store that sold you the
phone, or about faulty recharge cards.
- If your problem is with a network service provider or being
overcharged for bills, call the Telecommunications
Industry Ombudsman (TIO) on 1800 062 058. The TIO will also
examine complaints about faulty handsets where the handset was
bought as part of a contract or bundled deal.
If you're having problems managing your mobile phone bills or if
you're in debt, talk to your mobile service provider or the TIO
immediately. Find out more about managing debts.
The mobile phones and features that look great
in the ads may not be right for you, and may even get you into
debt. You're better off with a mobile you can afford.
Last updated: 28 Jul 2016