Keep your old phone, save some dosh

OK, listen carefully guys, we're going to try and save you some good money in felix this week. For many of us, our mobile phones are a vital part of our lives. However, we often pay well over the odds for them. For instance, did you know the cheapest iPhone 3GS contact comes to £729 (not to mention extra call charges) over the 18 month contract period? Did you know that per megabyte, sending a text message at 10p costs you almost eight times as much as it costs NASA to receive images of outer space from the Hubble Space Telescope?

Many of you will be able to save in the region of £180 per year by switching to a SIM-only tariff. You must have completed the original length of your contract on your phone, but then all it takes is a quick phone call to your network.

SIM-only tariffs

Traditionally mobile phone contracts have always bundled a “free” phone together with a monthly allowance of minutes, texts and maybe Internet access. However, a bit of deeper analysis shows that there really is no such thing as a free phone; typically you'll pay a surcharge of about £15 per month on your bill for that “free” phone.

So if you've just signed an 18-month £35 per month phone contract: roughly £15 per month of that goes on the surcharge for the free phone, meaning that “free” phone really costs you £270. After the initial 18 months, you've paid off that phone in full, so why should keep paying the £15 per month surcharge for the phone? In a straw poll, I've found that the vast majority of people keep paying the surcharge after the initial length of their contract, in essence throwing £15 per month down the drain, or into the network's coffers, for no reason. Therefor if you've completed the original term of your contract, you should consider switching to a SIM-only tariff.

On a SIM-only tariff, you only pay for the airtime, or inclusive minutes, you don't pay the phone surcharge because the tariff doesn't come with one. All of the major mobile networks have SIM-only tariffs available, so usually it's just a case of looking around your network's website, calling them up and asking to switch over. It's worth shopping around the other networks for great deals too.

Most people find they can get the same or better airtime allowance for £15 less per month (giving a total of saving of £180/year).

Apple iPhone 3G users

If you purchased an iPhone 3G close to launch in around June 2008, your 18-month contract will have just come to an end over the last couple of months. O2 are offering a range of SIM-only iPhone tariffs with rolling one month and 12 month options.

If you are on the standard iPhone tariffs, you will currently be getting 600 minutes, 500 texts and unlimited web browsing and WiFi for £35 permonth. However, by switching to 'Simplicity 25 for iPhone' for example, you will get 600 minutes, unlimited texts and unlimited web browsing for £25 per month; more texts and £10 cheaper! For the heaviest of phone users, there is also an 'Unlimited for iPhone' tariff available with unlimited everything for £50 per month. The best thing about the both SIM-only iPhone tariffs is that you can have a one month rolling contract, allowing you to upgrade to the new iPhone 4G in June without issue.

iPhone users can also shop around for SIM-only tariffs on other network s too, but be aware that you'll need a decent free Internet allowance and some features such as Visual Voicemail might stop working.

How to switch tariff or network

Finally, a couple of words on switching your phone tariff or network. If you are staying on the same network but want to switch tariff, you can call the customer services of your mobile network and ask to be switched over to your new tariff. Your phone number won't change, you won't need a new SIM card; all that changes is your phone bill.

If you want to change network then there are a few extra steps. Firstly, you'll need to have an unlocked mobile phone. The best way of checking this is to insert a SIM card from a different network and seeing whether your phone will accept it. Secondly, you'll need to ask your current network for a PAC, a port authorisation code. This allows you to take your phone number to your new network. By law, they'll have to provide you the code within two days of your request. Provide this PAC to your new network and your number should be transferred within two working days.

Hopefully this will be helpful to some of you! With mobile prices climbing, the cost of living already high and the odd beer here and there making a dent in your bank account, every little bit saved helps.