Purchasing a cell phone can come with mixed emotions; one on hand, who doesn't get excited about having a mini-computer at their fingertips…on the other hand, the price of these little gadgets is enough to reconsider if an "upgrade" is really necessary. If the time has come for a new cell phone, there are two options to choose to get a discount on that "must-have" phone and/or service plan. You can purchase just the phone from a reputable online retailer or negotiate with a service carrier for the phone and/or plan.

How to save on a phone

Let's take a look at two words widely used when purchasing a phone separately, without signing a contract:

Unlocked: The first word you may come across on these sites is "unlocked" – to put it simply, cellular providers usually "lock" their phones so they only work on their specific network. An "unlocked" phone is not configured or programmed for any particular network. If you see an "unlocked" phone that interests you, call your service provider and ask if they can configure it to their network and if all of the features will work (very important!).

Refurbished: The second word that you need to be familiar with is "refurbished." A refurbished phone was used for a period of time, then it was repaired, or replacement parts may have been installed and it is resold. Most reputable companies will stand behind their refurbished product, stating it should work "as good as new" and will offer some type of warranty on the item.

Here are some popular places to check for discounted cell phones that don't require the purchase of a contract:

  • 1saleaday.com: This is one of my favorite websites to get discounted items, particularly electronics or technology-related goods. The only catch is these discounted items are only on sale for 24 hours. 1saleaday regularly features amazing unlocked cell phones at low prices. I recently bought an unlocked, new AT&T Nokia Lumia 900 for $199.99. This phone is available today on eBay and other outlets for $300 and up. I was able to bring it into T-Mobile (my carrier), who switched out my SIM card and got me up and running in minutes. While this website does offer great deals, keep in mind they do not accept any returns unless the product arrives defective.
  • Amazon Warehouse Deals: Google "Amazon Warehouse" and you will find what I consider a hidden shopping mecca. Not regularly advertised, Amazon Warehouse works like this: Amazon receives a product, ensures it is working, determines the product quality level and then offers the product at a deep discount. Amazon Warehouse is the perfect place to find open-box, refurbished, used and like-new products, including popular cell phones at cheaper prices.
  • Technology Specific Websites: While there are many technology product websites that offer deep discounts on phones, to find the best deal you have to be willing to check these sites regularly, compare to other sites, and jump on a deal quickly. Some of the most popular sites for cell phones without contracts include: DealsPlus, BensBargains, SlickDeals, and TechBargains.
  • Here is an extra tip: If you are considering the purchase of a cell phone and need some extra cash to fund the endeavor, consider using a site like SellCell. Type in the make and model of your current cell phone and get a list of buyers and the amount they will pay for your phone. I sold my Samsung Galaxy Blaze through this site for a little over a hundred dollars, and put that towards the purchase of my Nokia Lumia on 1saleaday.com.

How to save on a plan

Once you have your cell phone and carrier in place, you may ask yourself, "How can I save more money?" Here are a few tips to keep in mind:

  • Take Advantage of Website Apps: SaveLoveGive is a free website that figures out where you could be overspending when it comes to your cell phone. If you are a Sprint, AT&T or Verizon customer (more coming soon), just plug in your cell phone account information to authorize access and voila! This website will analyze your entire usage plan, charges, and what you actually use each month. It then takes that information and compares it with other plans that are currently available. Switch a little something here, bundle a little something there, and gain an average savings of $1,200 per year! Another website similar to SaveLoveGive is BillShrink—it provides the same type of analysis and savings options based on your needs.
  • Mention Your Discount: If you are a teacher, government worker, in the military or even a student, you may just qualify for a considerable discount—up to 25 percent! The trick is, you have to ask for it. To learn more about who qualifies for a discount, check out these pages for Sprint, Verizon, T-Mobile and AT&T. Enter your email address for the company/organization you work for and get ready for some savings!
  • Don't Be Afraid to Negotiate: The wonderful thing about customer representatives at mobile carrier companies is their power to waive connection fees and offer rebates and incentives. When purchasing a phone or plan, you have the option to speak with a live customer service rep, visit a retail location or shop online. Studies show that speaking directly with a representative provides the highest savings in incentives and rebates than the other options. Don't be afraid to ask, "What can you do for me?" especially if you have been a customer with the company for many years. Knowing what other service carriers are offering as far as discounts can be helpful as well, as some carriers will try to match current deals.
How to Pay Less for a New Phone