Cell Phone Plans: All the Basics

Whether you just bought a new phone or are simply switching your cell phone carrier, the next step is to find your best-fit cell phone plan. To get talking, texting, and data streaming ASAP, start with our quick overview of cell phone plans.

The Big Cell Phone Companies vs. MVNOs

You might have noticed something surprising about our list of cell phone companies: some of those brands are household names, yet others you may have never even heard of. What’s up with that? In the world of wireless connectivity, the big names own their own networks while the little guys borrow the extra space.

The biggest companies are called MNOs, or Mobile Network Operators. MNOs create and maintain their own cellular networks. When you purchase a phone plan from an MNO, you’re being given access to a phone plan that operates on the company’s own telephone lines, 4G/5G networks, and other operating services.

On the flip side, there are smaller, lesser-known service providers called MVNOs, or Mobile Virtual Network Operators. MVNOs do not own their own network—instead, they lease their network space from MNOs at a discounted rate and then connect their customers to this leased network space.

As a customer, here’s what you really need to know about MNO and MVNOs:

MNOs

• Pro: Your calls, texts, and data are prioritized along the network, meaning your speeds rarely slow down.
• Con: You pay more for your phone plan, as you’re helping pay for the maintenance of the entire network.

MVNOs

• Pro: You pay significantly less for your phone plan, as MVNOs do not have to maintain a network.
• Con: You may experience slower data speeds at times from a practice called “throttling,” in which an MNO restricts the data use of MVNO customers along their network.

Prepaid vs. Postpaid (Bill Pay) Phone Plans

Network providers let you pay your phone bill in one of two ways: prepaid or postpaid.

Prepaid: With a prepaid phone plan, you can skip a credit check and keep an eye on your finances as you only pay for the phone services you use. At the start of the month, you select plan details such as calling minutes, text messaging, and data. If you exceed your purchased amount, you can simply buy more minutes/data.

The great thing about prepaid is that you won’t be charged more than what you agreed up-front. Unfortunately, that means that any unused minutes or data will feel like “wasted money.” Additionally, if you use your cell phone more than most, you may pay more over the course of a month than a postpaid customer.

Postpaid: Sometimes called “Bill Pay,” postpaid phone plans allow you to use your phone however you like and then pay the fixed monthly price each billing cycle.

Postpaid phones are extremely convenient: you can use your phone when and how you want and never worry about losing access to the network. Unfortunately, they tend to be pricier, may require a contract, and might stick you with extra charges for bonus services like international calling.

How Much Do Cell Phone Plans Cost?

The cost of your phone plan could vary quite a bit depending on the following factors:

• MNO vs. MVNO: Big-name MNO carriers tend to charge more for their services when compared to lesser-known MVNO companies.
• Prepaid vs. Postpaid: Prepaid phones tend to be cheaper on a minute-to-minute basis, but may cost more than postpaid plans if overused.
• Data Caps: Both prepaid and postpaid wireless plans reign in your data with caps. If unlimited data is important to you, you’ll have to pay more for it.
• Number of Lines: If you pay for multiple lines at once—maybe you’re connecting your partner or your children—you might save more per line than singles.

We get it: you want a ballpark estimate. On the low end, you may pay as little as $15/month for one line of limited data from an MVNO; on the higher end, you may pay as much as $65 for one line of unlimited data.

Here’s How You Switch to a New Phone Provider

Ready to make the switch to a new phone provider? The process is super easy and will look something like this:

1. Confirm network compatibility: Double-check that your new or old phone is compatible with your potential new network by searching on your new wireless provider's website.
2. Keep your old service: To port your old phone number and other important information to your new wireless plan, don’t cancel your old wireless plan just yet.
3. Purchase your new plan: Select your favorite plan and confirm your purchase.
4. Enter SIM card and activate: Your new provider will send either a physical SIM card in the mail or a digital eSIM card to your phone. Enter your SIM, activate your new carrier, and transfer your old network information.
5. Breakup with your old carrier: Confirm the transfer with your old provider. Once you get the all-clear, it’s time to make that breakup official with the old provider and say “Hello” to your new provider.

For even more help, check out our step-by-step guide on how to swap your phone carrier.

How to Choose the Best Phone Plan for You

The best phone plan is the one that best fulfills your needs. Are you a sports- and TV-streaming diehard? An unlimited plan would be your best bet. Own a business? You’ll want a carrier that offers multiple lines for you and your team to work together. Chatting on a budget? A simple prepaid service might save you the most money.

When thinking about your best-fit cell phone service, consider the following plan details:

• Pricing: How much does it cost for unlimited talk and text? What about data? Hotspot? International calls?
• Wireless Coverage: Whether your contacts are across the country or across the world, you’ll want to make sure your provider covers everyone in your contact list.
• Compatibility: Is your new network compatible with the phone of your dreams? What about your old phone that you intend to keep using?
• Family Plans: Will your new provider offer a deal if you add three lines, or charge you extra per line?

No matter what you’re looking for, you’ll find the top-rated cell phone plans right here on our comparison site.