Free phone? The hidden cost of tempting offers

Yahoo

13-05-2025

(WSPA) – Whether it's the cost of a new cell phone or the monthly service, Americans spend $180 billion a year on their mobile devices. Many don't realize there are simple ways to slash the cost of your cell phone plan, and sometimes smarter ways to get a new phone than taking advantage of the 'free phone' offer from major carriers.
Bob Atkisson reached out to 7NEWS, struggling to get answers on why his free phone offer that he got with a trade-in over the holidays appears to have raised his bill over the last few months.
'I specifically said to the person on the phone, I said, now just to make sure this will not cost me anything monthly, my bill will not go up. And she said no, as a matter of fact, it's going to go down,' Atkisson said.
The Greenwood man had seen a commercial offering an 'Apple 16 pro with Apple intelligence on us.'
But he told 7NEWS, after he saw his monthly bills, the offer he thought he was getting didn't add up.
'It actually shows that I've paid more money,' he said, confused.
We'll get back to Atkisson, but 60 miles north, Leon Wiles saw the same commercial and ran into the very same bill shock.
'It was twice as much as what they explained to me…I was shocked, I was totally blown away,' Wiles said.
He was even more shocked to see the bill he received after he sent back the two new phones, a charge for more than $1800.
In a statement, a Verizon Spokesperson told 7NEWS, 'We advise customers to carefully verify that any promotions they intend to use are indeed compatible with their selected service plan. It is crucial to understand the terms and conditions of both the plan and the promotion to ensure eligibility and avoid potential issues.'
Edgar Dworsky, Founder of ConsumerWorld.org, warns that free phone offers can lock you into higher payment plans for years.'Sometimes you wind up being put into a premium plan. I'm just shocked these days when I see $60/$70/$80 a month for one line? Are they kidding at the big carriers?'Dworsky's advice, seek out plans for closer to $25 a month. They're actually offered by major carriers like Verizon and AT&T through their pre-paid service, and they generally have ample data.For instance, AT&T has an unlimited talk, text and data pre-paid plan for $25 a month, if you pay for a year upfront ($300). In addition to pre-paid plans, you could also use a Mobile Virtual Network Operator, which resells service under much cheaper brands, though they may have more usage restrictions.
Another way to potentially save money is to look into selling your old phone outright instead of trading it in.
Many online sites typically offer more than your carrier, and you'll get cash, which means you are not locked into a lengthy plan.
Sites like Swappa, Decluttr and Gazelle specialize in electronic resale, and are generally trusted in the industry because they verify the used phones they sell are what they say they are.
Or if you want cash in hand, sell your old phone at brick-and-mortar stores like Fix Phone.
The manager of Fix Phone in Greenville, Adam Komilov, warned that when it comes to buying used phones that do not come directly from the manufacturer, do your research on third-party sellers.
'We have a lot of customers that spend like $1000 to buy an iPhone 16, brand new phone, but when they turn it on and check it out, it's an Android phone inside and they find out that they've been scammed,' he said.
Komilov also warned, sometimes people buy phones from third-party sites and social media, and end up with a stolen phone that the original user has locked, which means the phone won't work.
Back at Atkisson's home, 7NEWS helped connect him with a Verizon rep that settled his billing issue, so he's now back to paying about $240 for four lines, and is comfortable with a credit they gave him for his used phones.
Still, he's locked into 36 months of payments, so let's do the math on what he could be saving if he had switched plans to a prepaid one.
He would have had to buy the phones directly from Apple for $1600, offset by selling his old iPhone 13 Max Pro and iPhone 11 for an estimated $600.
But even with the net $1000 expense, if he had switched his plan to a prepaid unlimited for $25 per phone line, he has 4 lines, he would save $140 each month. In 36 months, he'd have $4,400 extra dollars plus two paid-off phones.
Wiles warned that his bill arrived just after Verizon's 30-day return policy ended. And he got nowhere, until he contacted 7NEWS, we reached out to Verizon and his $1800 bill was dropped.
'It was just spiraling. So, when I contacted you, I immediately got a positive response and affirmative response and I hadn't gotten that before. So whatever your magic was, it made a tremendous difference,' Wiles said to our 7NEWS Here to Help crew.
The moral of the story, be sure you get in writing exactly what your charges will be including taxes and fees for any 'free phone,' and if you're paying more than 25 to 35 dollars a line, know there are other plan options, some even unlimited, that could drastically lower your bill.
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