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prepaid cell phone comparisonIf you are shopping for a prepaid cell phone plan, the enormous variety of plans can be absolutely confusing. Prepaid cell phones offer some clear advantages over traditional contract plans.

  • Prepaid cell phone plans don’t require credit checks
  • You don’t have to sign a contract
  • They can be significantly cheaper than traditional cell phone plans.

Unfortunately, since every prepaid cell phone provider structures their pricing differently, comparing prepaid cell phone plans can be overwhelming.

When comparing prepaid cell phones you need to look at one thing – the activation period.

The activation period is the amount of time that the minutes you purchase are useable. Your minutes expire at the end of the activation period.

If you take a step back from the details of these plans and look at the big picture, you’ll find that all prepaid cell phone plans fall into two general categories: Pay As You Go plans and Monthly plans.

  • Pay as you go plans have varying activation periods (from 30 days to 1 year).
  • Monthly plans expire after a 30 day period.

When you read the reviews of prepaid cell phone plans keep these two pricing structures in mind.

Pay As You Go

Pay as you go plans offer varying activation periods.

These can be the most flexible plans, but unfortunately pay as you go plans can also be the most confusing for consumers. The basic principle is that you purchase a phone card and you get to use the minutes for the amount of time attached to that card. The average activation period is 90 days, but you can purchase cards that have more or less time.

Minutes expire at the end of the activation period. If you use up the minutes before the activation period ends, you can simply purchase more minutes and your activation period starts over. Many companies offer longer activation periods if you buy a larger number of minutes.

The standard activation period is 90 days, but many companies offer more or even less time periods. Most companies offer activation periods of 30, 60, 90 or 180 days. A few companies even offer a daily plan, while a few companies offer a yearly activation period. TracFone offers a separate card (without any minutes attached) that will extend your activation period out one full year.

Monthly Plans

This is the simplest of options. With monthly plans your minutes expire at the end of 30 days.

You buy a set amount of minutes and they expire 30 days from the time you activate them. Of course you are not locked into that 30 day period. If you use up your minutes before the time period, simply charge your phone with another card. For example, if you bought a monthly card that had 1000 minutes, but you used those minutes up in 20 days, just purchase another card and charge your phone with those minutes. Your 30 day activation period resets when you charge your account with the new card.

Like the pay as you go plans, you can purchase minutes in varying amounts. Plans are typically offered in 200, 500, and 1000 minute options. Most providers also offer an unlimited monthly plan which generally provides you with unlimited talk, unlimited text, and unlimited web access. These unlimited plans can be significantly cheaper than a contract plan.


Whether you choose a pay as you go option or a monthly plan, prepaid cell phones give you the flexibility to tailor you cell phone budget to the amount of minutes you use. You can increase or decrease the amount of minutes you purchase based on how many minutes you actually use.

So what are the advantages of a pay as you go plan vs. a monthly plan?

Both types of plans offer varying amounts of airtime from 60 up to 1500 minutes. The major difference though is the time component – the activation period. Monthly plans have a 30 day activation period while pay as you go plans have activation periods anywhere from 30 to 365 days. So, with that in mind, here are the benefits of each type of plan:

  • Pay As You Go. If you are an infrequent cell phone user, you can use the longer activation periods of pay as you go plans to your advantage. Pay as you go plans make sense for people that use their cell phones occasionally. If you need a cell phone for emergency use only, or if you go long periods of time without using your cell phone, say a month or longer, then pay as you go plans will make sense for you. By having a longer activation period, you can keep your cell phone activated between the times that you use it. You could theoretically use a monthly plan for the same purpose, but many cell phone companies will drop your phone number if you don’t keep your phone activated.
  • Monthly. If you use your cell phone consistently month in and month out, then go with a monthly plan. Even if you only use a few minutes a month, if you are sure you are going to use your cell phone, go with the monthly plan. Monthly plans are offered in varying minute packages so you can tailor your budget to your usage. Also, if you use a LOT of minutes every month, then you’ll want to go with an unlimited monthly plan. The unlimited plans offered by prepaid cell phone companies are significantly cheaper than almost any contract plan.

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