What are the advantages and disadvantages of prepaid cell phones and what things should someone need to know in order to decide which prepaid phone plan to use?

Significance For many people, prepaid mobiles fit their cellular needs. They want the convenience of a cell phone without the hassle of a monthly bill. Or maybe they don’t consistently use a large amount of minutes each month.

Or they don’t want to sign a long-term contract. Or they have credit problems that would prevent them from getting approved for a rate plan. Or their teen wants a cell phone, but they don’t want to worry about their child going over her minutes.

Types All major cellular companies offer prepaid or pay-as-you-go plans. Customers can choose a per-minute rate for their calls. They can pay a daily access fee and then a lower per-minute rate; some companies offer several levels of this plan, allowing a lower per-minute rate for a higher daily access fee.

Or customers can choose a monthly or “flex” plan that is similar to a rate plan. Their monthly rate is paid at the first of the month via a credit or debit card. There are also cellular companies, like Cricket, ... more.

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