Why You Should Consider a Prepaid Phone Plan

If you’re looking for ways to save money on your monthly bill, consider switching to a prepaid cell phone plan.

In this article, I’ll explain the differences between prepaid and postpaid phone plans, highlight the benefits of prepaid plans and list my top picks for the best prepaid phone plans available.

I’ve researched more than 70 phone plans to find the absolute best prices and features. Through this process, I’ve been able to see firsthand how much you can save by switching to a prepaid plan.

This article was updated in December 2023 and I review it every six months. Detailed notes on all updates can be found here.

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Prepaid Cell Phone Plans: What You Need To Know

A prepaid cell phone plan can be a great way to save on your monthly phone bill, and you’ll have access to the same service as postpaid plans. 

With prepaid phone plans, you won’t have to worry about a credit check or monthly contract. You’ll also find lower prices per line than with traditional postpaid plans. Plus, there are more options and features available now with prepaid phone plans, so you can choose the amount of talk, text and data that works for you. 

Before you make the switch to a prepaid phone plan, here’s what you need to know: 

• Prepaid Phone Plans vs. Postpaid Phone Plans
• The Benefits of Prepaid Phone Plans
• What To Know Before You Switch
• The Best Prepaid Phone Plans

Below, you’ll find more information on prepaid phone plans including the top five benefits of a prepaid plan and the best plans available now.

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Prepaid Phone Plans vs. Postpaid Phone Plans

Prepaid and postpaid phone plans aren’t really all that different these days. Now, “prepaid” simply means that you pay your bill before you use the phone’s service instead of at the end of the month.

Prepaid phone plans are available from major cell phone service providers such as T-Mobile, Verizon and AT&T as well as from cost-efficient MVNOs that run on the same towers as major networks (examples include Tello Mobile, Visible and Boost Mobile.) 

You can choose unlimited talk, text and even data for a lower price than you’ll see with traditional postpaid plans. The price is often lower because you get lower data caps and earlier deprioritization, but being able to avoid a credit check, contract and overage fees may be worth it to you. To see exactly how much you can save with a prepaid phone plan, I looked at a couple of examples from AT&T and T-Mobile:

• AT&T offers a 4GB plan for $50 per month for one line with unlimited talk, text and 4GB of data, while prepaid plans directly from AT&T (Review) begin as low as $25 per month per line for 16GB of high-speed data when you prepay a year in advance. Of course, the data is likely to be a little slower with a prepaid phone plan. But you’ll save $25 per month for one line and get four times the amount of high-speed data by switching to AT&T Prepaid.
• Next, let’s consider T-Mobile. For one line, T-Mobile Prepaid (Review) offers plans beginning at $40 per month for 10GB of data and unlimited postpaid plans that range from $60-$100 per month for one line. Connect by T-Mobile (Review) is another prepaid option with plans beginning as low as $10 per month for 1GB of data. Alternatively, Tello Mobile (Review) is an MVNO that runs on the same towers with monthly prepaid plans beginning as low as $5. For $9, you can get unlimited talk, text and 1GB of high-speed data. For $25, you can get Tello’s unlimited plan, which includes 35GB of high-speed data per month.

As you can see, prepaid phone plans are a great way to save on your monthly phone bill. For even more affordable options, be sure to check out our full list of the best prepaid phone plans.

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The Benefits of Prepaid Phone Plans

No matter which plan you decide is best for you, opting for a prepaid phone plan, in general, has its benefits. You’ll be able to find a lower monthly price, change your plan at any time and enjoy the same coverage that you’d get with a postpaid plan. 

If you’re still on the fence about it, here are five of the best reasons to consider a prepaid phone plan: 

1. Pricing. Generally speaking, prepaid phone plans are cheaper. You’ll find deals beginning at $5-$10 per month with prepaid plans such as Tello Mobile, Boost Mobile and Connect by T-Mobile. While you’ll likely have slower data speeds, you’ll still have access to the same service. 
2. No Credit Checks. When you sign up for a prepaid plan, you’ll pay upfront for what you plan to use, and you won’t have to sign a contract. That means you won’t have to worry about any credit checks because you won’t be borrowing anything.
3. Flexibility (No Contracts). Since you won’t be signing a contract with a prepaid phone plan, you’ll have total flexibility. You can cancel, change your plan features or change your phone at any time. 
4. No Overage Fees. Since you’ll be paying upfront for what you use, you won’t have to worry about overage fees. Prepaid plans simply pause your service once you’ve met any calling, texting or data limits. And you can change your plan or add to it at any time.
5. Coverage and Features. Prepaid phone plans from major carriers and MVNOs offer the same coverage that you get with traditional postpaid plans. Plus, there are tons of features to choose from now with prepaid plans including mobile hotspot availability and international add-ons. 

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What To Know Before You Switch

While there are several benefits to choosing a prepaid phone plan, there are still a few major differences and exceptions that you should be aware of. For example, if you’re looking for a family phone plan with shared data, if you’re looking for a phone plan with a lot of additional perks or if you’re looking for a contract-based phone plan that includes a new phone on a payment plan, you may want to consider a postpaid plan instead. 

Before switching to a prepaid phone plan, here are a few differences that you should be aware of:  

1. Data may be slower. Monthly prices are lower with prepaid phone plans due, at least in part, to the fact that data may be slower. This is thanks to data throttling and prioritization, which basically means that you may have a limited amount of high-speed data or experience slower speeds when the network is busy. Prepaid phone plans tend to get hit the hardest with this, so expect slightly slower data speeds.
2. There will be fewer perks included. Compared to postpaid family plans and major carriers, you’ll find fewer perks with prepaid phone plans. You won’t see many prepaid family plans with shared data, multi-line discounts or streaming service subscriptions. Plus, you’ll need to bring your own phone or buy a new one on your own. Prepaid plans without contracts don’t typically offer new phone deals. 
3. International data may not be available. Many prepaid plans don’t include international talk, text or roaming. In fact, several prepaid plans and carriers don’t offer international data at all. So if you’re a frequent traveler, prepaid may not be the way to go. Still, as long as your phone is compatible, Wi-Fi calling and texting will be available anywhere you’re connected.

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The Best Prepaid Phone Plans

When it comes to prepaid phone plans, there are more options to choose from now than ever. There are prepaid plans available directly from major carriers as well as from more cost-efficient MVNOs that provide access to the same service towers. I’ve researched dozens of prepaid phone plans to find the absolute best prices and features. You can check out the full list here.

Below, you’ll find my top three picks for the best prepaid phone plans.

	Tello Economy	Visible	T-Mobile Simply Prepaid
	Tello Economy	Visible	T-Mobile Simply Prepaid
Price	$9/month (plus taxes)	$25/month (taxes & fees included)	$50/month (plus taxes & fees)
Talk and Text	Unlimited	Unlimited	Unlimited
Network	T-Mobile	Verizon	T-Mobile
Data	Unlimited	Unlimited	Unlimited
Data Cap Overage	1GB	None, but speeds may slow during congestion.	50GB
	Shop Now!	Shop Now!	Shop Now!

• Tello Mobile: Cheapest Overall Prepaid Phone Plan
• Visible: Cheapest Unlimited Prepaid Phone Plan
• T-Mobile Prepaid: Best Unlimited Prepaid Plan from a Major Carrier

Below, you’ll find additional information on these three top picks for a prepaid phone plan. For more options and information, be sure to check out our full list of the best prepaid phone plans.

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Tello Mobile

Team Clark’s Review Price: $9/month (plus taxes) Multiline Discounts: No Talk and Text: Unlimited Data: Unlimited Data Cap Overage: 1GB Hotspot Data: Free; pulls from monthly data

Cheapest Overall Prepaid Phone Plan

Tello Mobile offers prepaid plans beginning as low as $5 per month. Unfortunately, that price only includes 100 minutes and no data. However, for a more reasonable phone plan, Tello still offers incredibly low prices. For unlimited talk, text and 1GB of high-speed data per month, Tello offers a $9 monthly plan. Additional plans from Tello Mobile include 2GB of high-speed data for $10, 5GB of high-speed data for $14, and 35GB of high-speed data for $29.

For even more savings from Tello Mobile, check your phone’s compatibility online to see if you can bring your own device with you when you switch. To learn more about Tello Mobile before switching, be sure to check out our full review. 

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Visible

Team Clark’s Review Price: $25/month (taxes & fees included) Multiline Discounts: No Talk and Text: Unlimited Data: Unlimited Data Cap Overage: None, but speeds may slow during congestion. Hotspot Data: Unlimited (speeds up to 5Mbps)

Cheapest Unlimited Prepaid Phone Plan

If you’re looking for a prepaid phone plan with unlimited data (and unlimited mobile hotspot data), Visible’s $25 plan is a great option. Visible runs on Verizon Wireless’ network.

For $25 per month for one line (new customers only), you’ll get unlimited talk, text and data, though speeds may slow when the network is congested. There’s no high-speed data cap that you’ll have to look out for, but that also means that deprioritization can happen at any time. Visible’s $25 plan includes unlimited mobile hotspot data, but hotpsot speeds are capped at 5Mbps.

Visible also offers a $45 unlimited plan that includes 50GB of premium mobile data before slower speeds, unlimited talk, text and mobile hotspot data. To see if your phone is eligible to bring with you to Visible, check its phone’s compatibility online before switching. To learn more about Visible before switching, be sure to check out our full review. 

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T-Mobile Prepaid

Team Clark’s Review Price: $50/month (plus taxes & fees) Multiline Discounts: Yes Talk and Text: Unlimited Data: Unlimited Data Cap Overage: 50GB Hotspot Data: Unlimited at 3G speeds

Best Unlimited Prepaid Plan from a Major Carrier

If you’re looking for an unlimited prepaid plan from a major carrier, T-Mobile Prepaid is a good option to consider. The cheapest unlimited plan is available for $50 per month for one line plus taxes and fees. Speeds slow after 50GB, but you can still continue using unlimited data. This plan also includes unlimited mobile hotspot data at 3G speeds as well as unlimited talk and text. 

Additional plans from T-Mobile Prepaid include 10GB for $40 per month for one line and Unlimited Plus for $60 per month for one line. If you’re thinking about switching to a T-Mobile plan, be sure to check your device’s compatibility online first.

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Final Thoughts

Ultimately, switching to a prepaid plan is a great way to save money. You’ll find lower monthly costs for the same coverage and a variety of features. You won’t find credit checks, contracts or overage fees. Of course, data may be slightly slower than you’d experience with postpaid services. There may also be fewer perks and limited international features.

If you’re thinking about switching to a prepaid plan, be sure to check out Tello Mobile for the cheapest monthly price. If you’re willing to pay for a year of service in advance, Boost Mobile (an MVNO that uses AT&T and T-Mobile’s towers) will be even cheaper overall. Visible offers the cheapest unlimited prepaid phone plan and T-Mobile Simply Prepaid is a great unlimited option from a major carrier. For more of the best prepaid phone plans, check out our full list here.

For even more options, be sure to read our guide on the best cell phone plans and deals available now and our full list of the best prepaid phone plans. Once you’ve decided on a new phone plan and you’re ready to make the switch, check out this guide that we put together to take you step-by-step through the process.

Did we miss a plan on our list or did you find a better deal? Let us know in our Clark.com Community or check out the latest conversations around cell phones.