Prepaid Cellular Plans
Flexible and affordable. No contracts, no surprises.

It's hard to believe that fewer than 10 percent of cellular plans sold in the US are prepaid plans. While they're not for everyone, the are a better fit for more people than the numbers suggest.

Is a Prepaid Plan Right for You?
If you fit into one or more of these categories, you can save money on your cell phone bill by signing up on a prepaid plan. When you switch, you can even keep your existing cellular phone number, thanks to the Wireless Local Number Portability Act (WLNP).

• Light to Moderate Use
  People who use their cell phones 450 minutes a month or less will definitely save money on a prepaid plan. The lowest price you'll find for a traditional, contract plan from the major national carriers is $40 a month for a barebones plan. Add taxes and "recovery" and other fees and your will find yourself at $45 a month.
  
  Prepaid plans have rates as low as 10 cents a minute with long distance included. What you don't use, you don't pay for. If you only talk for 150 minutes, you spend $15.
  
   
• Emergency Phone Use
  Amazingly, a very large chunk of people are paying $40 a month or more just to have a cellular phone to use in emergencies. This is crazy!
  
  Any working cellular phone can be used to dial 911. And a prepaid plan is a very affordable way to make occasional calls to non-emergency numbers.
  
  While most prepaid plans have no monthly fee, all of them policies which impose a "virtual" monthly fee for extremely low usage customers, such as emergency phone users. This trick is to find a provider with the least restrictive policies, resulting in the lowest virtual monthly fee.
  
  Lifeline Cellular has identified two carriers that we believe have the lowest monthly fee in the USA: Beyond Wireless at 6 cents a month and JusTalk at $2.50 a month. We have a partnership with JusTalk and can offer you a phone and plan for $34.95. You can find more on specific providers below.
  
   
• Credit Challenged
  If you have a bad or little credit history, most companies offering traditional, contract plans will require a large cash deposit or refuse you outright. They do this because they won't profit from you unless you complete the entire term of the contract (usually one or two years).
  
  With prepaid, as the name implies, you only are allowed to use minutes you have already paid for. Since you've already paid, they've already made their profit and you pose no risk to them.
  
   
• Inconsistent Minute Usage
  The insider secret of contract plans is that they make a big profit off of you when you under-use your allotted minutes and, as most people are aware, they make an even bigger profit when you use more than your allotted minutes.
  
  If your month-to-month minute usage varies widely, with a contract plan you will end up paying much more than you would with a prepaid plan. This is because you will either buy many more minutes than you'll use on your light months or you'll pay outrageous overage charges on your heavy months if you sign up on a plan with a small number of minutes.
  
  Prepaid plans are the perfect solution for cell phone users whose talk time varies drastically from month-to-month. On a prepaid plan, you pay for exactly the number of minutes you use. No more, no less.
  
   
• Short-term Usage
  Prepaid plans are also great if you plan on having a phone for a year or less. The minimum term for a contract plan is one year. If you quit before then, you will pay a hefty "early termination fee." Your only cost-effective option is to continue paying the monthly bill until your contract expires.
  
  On a prepaid plan, you can quit any time. No contracts to get out of. No fees. No hassles.

 

Independent Providers
You will find the best rates and most flexible plans with independent prepaid companies. If you find a provider that has local numbers in your area and convenient refill options, this may be your best options. Consider these providers:

• Beyond Wireless
  This company has the lowest minimum monthly usage of any prepaid carrier in the country a 6 cents a month (JusTalk is the second lowest). They are a regional carrier with aspirations to become national. Currently they serve primarily the Southeast US and are creeping up the East Coast. By requiring their customers to make only one call every two months, we wonder how they are able to stay in business! Before signing up with them, be sure you find a retailer where you can add more minutes (you can also add Beyond Wireless minutes online). Lifeline Cellular can sell you a phone for $34.95 that is compatible with Beyond Wireless's network.

• JusTalk
  Nationwide local numbers. Uses Cingular's network. Refill minutes at any of 20,000 Western Union outlets, among many other places (you are likely to find a Western Union at your local grocery or convenience store). Rates are as low as 13 cents a minute with free long distance. Lifeline Cellular has a partnership with JusTalk and can get you started for only $34.95 (plus shipping and handling). With the exception of Beyond Wireless (below), JusTalk has the lowest minimum monthly usage of any prepaid carrier in the US.

 

Large, National Providers
These are the companies you will probably recognize. A national carrier may have some attractive features that the independent guys don't offer. However, price is your biggest concern, you are better off with an independent provider.

• TracFone
• Cingular
• Verizon
• Virgin
• Boost Mobile