How to get the cheapest iPhone plan without handset repayments

Posted: 22 December 2016 1:30 pm


Want an iPhone on contract without extra handset repayments? It can be done, but choose carefully with older iPhone models.

You’ve always got the option to buy an iPhone outright and go on either a month-to-month or prepaid plan, but that requires a significant upfront spend on the iPhone handset, which typically equates to over $1,000 outright. This is why so many Australians who want iPhones buy them on a contract with a carrier instead, typically over 24 months. On that kind of contract, you'll pay a monthly total which includes both the charge for the plan and a handset fee.

Some carriers don't show the costs separately, but our mobile phone finder will always show you the split price for any handset, as well as the total cost.

Apple’s iPhone remains the most popular smartphone in Australia and this has enabled Apple to continue to charge a premium price for its phones. Indeed, it has been able to arrange deals with carriers that still include handset repayments on almost every plan, which something that no other phone series, including Samsung’s very popular Samsung Galaxy S7, does.

So is it possible to find a mobile phone contract for an iPhone that doesn’t include a separate handset repayment? Can you sign up for a contract where the iPhone is essentially thrown in for free and you're just paying for calls, data and texts?

The answer is yes, but you'll have to make some compromises. If you are looking to avoid handset repayments as part of a contract, you’ll almost always have to settle for the entry level storage variant of your chosen iPhone model. That brings its own storage challenges if you want to store a lot of photos, music or video on the device. For the cheapest plans, you'll also have to be content with an older iPhone model.

Below we've rounded up all the currently available Australian iPhone plans (as of December 2016) that don't include an extra handset repayment. Every single plan on this list includes unlimited national calls and texts, so the main features that differentiate them are the included data and which network they run on.

iPhone 5S

The budget option: iPhone 5s

The oldest current iPhone in Apple’s lineup is still offered by the major carriers, and it’s far and away the lowest cost way to score an iPhone on contract with no additional repayments required. That being said, even for a phone that's as old as the iPhone 5s, there's a difference between lowest cost and "inexpensive", especially depending on your choice of carrier. Here's how the two carriers who still offer the iPhone 5s compare.

PlanDeviceMonthly CostDataMinimum 24 month cost
Telstra Go Mobile MiPhone 5s 16GB$753GB$1,800
Vodafone Red $60iPhone 5s 16GB$603GB$1,440

There’s an obvious catch with getting an iPhone 5s at this stage in the iPhone life cycle. To put it bluntly, the iPhone 5s is a seriously ancient iPhone, and most likely to be entirely discontinued when iOS 11 rolls around, thanks to the introduction of the iPhone 7 and iPhone 7 Plus. Within the span of a two year contract you're almost certainly going to end up with a phone that doesn't get the latest iOS updates. That doesn't mean the phone won't work, but your access to new apps is likely to become patchy.

Into the mid-range: iPhone SE

Apple doesn’t officially call the iPhone SE the "cheap" iPhone, but that’s effectively what it is relative to the outright price of other current iPhone models. You pay less for it upfront, and that means it’s also a more attractive prospect for carriers to offer at lower contract tiers, at least in theory.

In practice, there’s wide variation between the major carriers as to which price point the iPhone SE is offered with no additional handset repayments, as you can see below.

PlanDeviceMonthly CostDataMinimum 24 month cost
Telstra Go Mobile LiPhone SE 16GB$551GB$1,320
Optus My Plan Plus $65iPhone SE 16GB$653.5GB$1,560
Vodafone MyMix Red Data $70iPhone SE 16GB$8011GB$1,920

The SE's positioning as the affordable iPhone gives it something of a sweet spot when it comes to pricing. At the time of writing Telstra's running a deal on the 16GB model where it's available with no handset repayments at any plan price point. Given its relatively new status and pricing, there's really no reason to opt for an iPhone 5s on contract when you can get the considerably improved iPhone SE for the same or lower pricing.

You can check all the available iPhone SE plans in Australia here.

Into the mid-range: iPhone 6s/iPhone 6s Plus

The iPhone 6s and 6s Plus are the next range that's offered across multiple carriers; while you may find the iPhone 6 or 6 Plus with some carriers, those are truly end of life stock, and there's a strong argument to steer clear of two year old iPhones unless there's a significant price drop anyway. In our experience that isn't always the case.

The one big benefit you get here is that when Apple introduced the iPhone 7 and iPhone 7 Plus, it also doubled the baseline for the older iPhone 6s handsets. As such, you score a much more comfortable 32GB of storage rather than squeezing into 16GB.

PlanDeviceMonthly CostDataMinimum 24 month cost
Telstra Go Mobile LiPhone 6s 32GB$9510GB$2,280
Optus My Plan Plus $85iPhone 6s 32GB$8510GB$2,040
Vodafone Red Data $90iPhone 6s 32GB$10013GB$2,160

While it's feasible to score a 6s without handset repayments, you do start to stretch up into the higher plan price tiers to do so. At these kinds of prices it's not uncommon to see premium Android handsets on sale with no handset repayments, some of which are much newer and more powerful than the 6s.

You can compare every available iPhone 6s plan in Australia here.

Staying current: iPhone 7/7 Plus

If you're signing up for a two year contract, it makes sense to get a phone that is as current as possible. In the case of Apple, that's the iPhone 7 or iPhone 7 Plus. They're definitely premium handsets, but can you get one on contract without handset repayments?

The answer is yes, but you've got to settle for that entry level 32GB tier and opt for a higher price contract to do so.

PlanDeviceMonthly CostDataMinimum 24 month cost
Telstra Go Mobile XLiPhone 7 32GB$13510GB$3,240
Optus My Plan Plus $120iPhone 7 32GB$12020GB$2,880
Vodafone MyMix Red Data $100iPhone 7 32GB$10022GB$2,400

Apple positions the iPhone 7 as its flagship premium phone, so it's no surprise that the cheapest plan you can get an iPhone 7 32GB without additional handset repayments starts at $100 per month.

Want to compare every iPhone 7 storage variant and plan? You can do so right here.

Predictably, to score the iPhone 7 Plus with no handset repayments, you've got just a single choice at the time of writing, with only one carrier offering a pricing tier that doesn't include some form of handset repayment.

PlanDeviceMonthly CostDataMinimum 24 month cost
Telstra Go Mobile XXLiPhone 7 Plus 32GB$19530GB$4,680

Here's what you'll pay for every iPhone 7 Plus plan across Australia.

Why do handset repayments matter?

You can always opt for a lower-tier plan with handset repayments built in; at the time of writing the lowest cost you could score an iPhone 7 32GB for is $62 per month, but that’s for a plan with a relatively meagre 500MB of data usage per month. That’s not going to suit too many iPhone users, and a pricier plan is likely to be better value overall.

Fundamentally, as with any phone contract, it's a tradeoff between the handset repayment price you pay, and the inclusions you get with that particular contract tier. The lure of a "free" phone means that you're essentially spending that money on a larger package of provided services, primarily through expanded data allowances, but also potentially through extras such as free international calls or bundled entertainment packages.

The real contrast point for iPhone handset repayments, however, is against pretty much any other Android phone. There’s nothing at all in the Android space offered by a major carrier that isn’t automatically a "free" phone at the highest tier for every carrier, and most are available at sub-$100 plan price points with no additional payment either, which means you score the best of both worlds.

Image: Shutterstock

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