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Find and Compare the Best Cell Phone Plans: A Definitive Carrier Comparison

To illustrate what you might pay with a subsidized, locked plan versus going the unlocked route (in which you purchase your phone at retail cost), we'll look at the price comparison for an iPhone 5. Say you bought a 16GB iPhone 5 subsidized from AT&T ($199.99 before any deals); the cheapest 2-year contract is $85 per month and includes unlimited calls, unlimited texts, and 1GB of data. The total cost over two years? $2, 239.99.

Alternatively you could pay $649 for an unlocked 16GB iPhone 5 direct from Apple and then opt for a monthly, no-contract plan from T-Mobile. For $60 per month you'd get unlimited calls, unlimited texts, and unlimited data (with the first 2GB up to 4G speeds). Over two years that amounts to $2, 089. That's a $151 difference.

If you were willing to go with a smaller carrier, then you could buy the same $649 iPhone 5 from Walmart and opt for a per month contract from Straight Talk (owned by Tracfone). This plan offers unlimited minutes, unlimited texts, and unlimited data and over two years would cost you , 729 — that makes the Straight Talk iPhone option substantially less than the subsidized option, and $360 less than the above unlocked scenario.

The Difference Between These Options

The value proposition for the three options above is clear, but what exactly are you signing up for with each? With AT&T, you'll be locked into a contract for two years, and if you leave early, you'll be charged a termination fee. However, you'll be able to enjoy 4G LTE speeds if you live in an area with coverage. That said, your data limit is a strict 1GB and if you need more, then you have to jump up to 4GB, which will make your monthly payment $115, or $30 more per month and $360 more per year. If you don't increase your allowance in advance, and you ignore the warning and exceed your limit, then you'll face overage charges that can be even higher: nearly per GB.

The T-Mobile plan is monthly so you can jump ship at any time, but there's no telling when they might change their prices. T-Mobile offers HSPA+, which is really 3G, although speeds can be comparable to 4G LTE in the right areas. However, T-Mobile intends to roll out a full 4G LTE network in the coming months. The data in the aforementioned plan is "unlimited" but the terms read that data is available at the top speed for up to 2GB per month, and then at a slower speed beyond that.

With Straight Talk, you're paying monthly with no long term obligation either, so, once again, you can jump ship at any time — but prices could go up at any time as well. Straight Talk offers HSPA+ in some areas, but there's no LTE. They also offer "unlimited" data, but in practice you will likely be throttled if you exceed 2GB per month. Straight Talk doesn't have a transparent fair usage policy, though, so that 2GB limit is based on anecdotal evidence, and mileage may vary.

Plan Prices by Carrier

The four major U.S carriers are AT&T, Verizon, T-Mobile, and Sprint, each of which offers nationwide coverage, though their smartphones and plans are quite different. You'll also find a growing number of smaller carriers that offer alternative plans and coverage. First, we'll look at each of the major carrier's plans, contract terms, and family share options.

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