Itâs always a great feeling to know youâve paid off a bill. But what if you were still being charged every month for something youâd already paid off? Well that could be happening with your mobile phone contract…
New research for our Unlock Better Mobile Deals campaign shows that weâre collectively wasting a shocking ÂŁ355m every year by shelling out for handsets weâve already paid off.
Thatâs because nearly half of the people in our survey didnât switch straight away when they came to the end of their contract. On average theyâre paying an extra ÂŁ92 each towards handsets they already own.
Vodafone, EE and Three
So how is this happening? Well, most contracts combine the cost of the tariff and the handset. But itâs not normally split out like that, so people don’t know how much each element costs or when theyâve finished paying for their phone.
O2, Virgin Media, Tesco Mobile and Utility Warehouse have tariffs where the handset and airtime costs are separate, while giffgaff has never bundled the handset in. Whereas Vodafone, EE and Three customers still continue to be charged one bundled price.
For example, a contract with O2 Refresh for an iPhone 6 costs ÂŁ49 a month for 5GB of data and unlimited minutes and texts. Of this, O2 is clear that the handset part of the bill is ÂŁ25, meaning that youâll only pay ÂŁ24 per month when the contractâs over.
On a similar plan with Vodafone (4GB of data and unlimited minutes and texts) it costs ÂŁ48.50 a month. However, that price doesnât change once you come to the end of your contract and youâve finished paying off the cost of the handset.
Overpaying for your mobile phone
If you donât switch as soon as your contract has ended it could end up costing you around ÂŁ22 for every month you go over. Thatâs what happened to Jeremy:
âI was nearing the end of a two year contract that included an iPhone, so I rang Vodafone to ask about upgrading to a new handset. I was told an upgrade would be available nearer to the end of the contract â but when the contract finished, Vodafone didnât tell me or offer an upgrade.
âWorse, they continued to charge me ÂŁ45 a month for a phone I had already paid off. I only discovered that I was overpaying when my daughter mentioned that her bill was only ÂŁ15.â
We think people are being misled and, as a result, are collectively paying millions of pounds each year for a phone theyâve paid off. Weâre calling on all providers to separate out the cost of the handset so you donât continue to pay after the contract comes to an end. You shouldnât be handing over money for nothing.
Have you ever continued paying the same amount to your mobile provider even though youâd come to the end of your contract?
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