Contract vs SIM-only plus handset purchase total cost

The Hidden Handset Premium

A 24-month contract at 45/month with a free flagship phone totals 1,080 over the contract. The same phone bought outright typically costs 800-900 with 15-20/month SIM-only service — 720-1,380 over 24 months depending on usage. The contract route is almost always more expensive for equivalent network service.

Keep Duration Changes Everything

A phone held for 36 months (12 beyond the contract) spreads the handset cost further. SIM-only users save a further 300+ in months 25-36. Contract users must either upgrade and start a new 45/month handset premium, or roll onto SIM-only anyway — losing the implicit handset subsidy.

The Usage Trap

Contract plans often bundle generous data, international roaming, and streaming add-ons whose cash value is 30-50% of the bundle price. If those are actively used, the contract value improves. If not, the bundle is subsidising features never consumed.

Run it with sensible defaults

Using contract monthly price of 45, contract length of 2, contract upfront handset cost of 0, sim-only monthly price of 15, the calculation works out to 540.00. Nudge the inputs toward your own situation and the output recalculates instantly. The defaults are meant as a starting point, not a recommendation.

The levers in this calculation

The inputs — Contract Monthly Price, Contract Length, Contract Upfront Handset Cost, SIM-Only Monthly Price, and Separate Handset Price — do not pull with equal force. Frequency and unit price pull the total in different directions. The biggest surprise for most people is how small recurring amounts compound into large annual figures — that's where this calculation earns its keep.

How the math works

Contract total equals handset upfront plus contract monthly times 12 times contract years. SIM-only total equals handset price plus SIM-only monthly times 12 times keep years. Results are estimates for illustration purposes only. The working is transparent — you can verify every step yourself in the formula section below. No black box, no opaque "proprietary model".

Why run the numbers before the purchase

Big purchases reward slow thinking. The calculation here is fast; the decision it informs isn't. Running this before you shop is the cheapest way to avoid the "seemed fine in the showroom" trap.

What this doesn't capture

Purchase decisions rarely come down to payback alone. Reliability, time saved, enjoyment, and alternatives outside the calculation all matter. The figure gives you the money side cleanly so you can weigh it against everything else honestly.