AT&T Inc. (NYSE:T) Narrows Your Installment Plan Options

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AT&T Inc. (NYSE:T) is tweaking its phone financing plans. The carrier is reducing the financing options to just two from the current four. The new plans are expected to take effect on June 9.

According to AT&T Inc. (NYSE:T), cutting down the number of installment plans is in the best interest of its customers because it eliminates confusion. For background, AT&T embraced installment phone financing plan after rival T-Mobile US Inc (NASDAQ:TMUS) made the legacy phone subsidy package look like a bad thing. As part of its Un-carrier movement, T-Mobile popularized the concept of letting customers to pay the full retail price of the phone through installment plans rather than locking them in with plans that run for years.

The old method is going away

AT&T Inc. (NYSE:T) is tweaking its AT&T Next and AT&T Next Every Year. Under the current AT&T Next Every Year, you have 24 months to settle the full retail price of your phone. But you can upgrade your handset after the 12th installment or after have paid 50% of the retail price of the phone you are holding. The other condition with AT&T Next Every Year is that you are required to trade in an eligible handset.

As for AT&T Next, customers have 30 months to pay the full retail price of the phone they are holding. But after you have made installments for 24 months or paid off 80% of the device, you are eligible to upgrade your handset. This plan also calls for customers to trade in an eligible device.

What’s new in AT&T’s camp?

The new phone installment plans from AT&T work this way: You are buying a phone that costs $750. Under the AT&T Next plan, you will have the choice to put down zero deposit and make monthly installment payment of $25 or put down $225 in deposit and pay $17.50 per month. As for AT&T Next Every Year, you will have the option to make a down payment of $225 and get on an installment plan of $21.88 per month. Alternatively, you can choose not to make a down payment and get on the $31.25 per month installment plan.

AT&T Inc. (NYSE:T) and other carriers are finding that installment plans allow customers to update more frequently and give them more freedom as they can switch carriers at will.

Neha Gupta

Neha Gupta has been in the financial space for over six years now. Gupta earned her MBA degree from Symbiosis Centre of Distance Learning in 2009 and her passion for finance led her to pursue Chartered Financial Analyst (CFA) course. She has successfully completed Level II of her CFA. She is a veteran in article writing, which is depicted in her numerous pieces published on SeekingAlpha, Nextiphonenews, InsiderMonkey, MarketWatch, and Techinsider. Her crisp and eloquent writing finds its best place in Researchcows, where emphasis is given on developing rich content for various websites, products, business plans, trainings, and book writing.

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  • Joe

    The big issue here, is sales & marketing hiding the total monthly cost to the customer. “This plan is only 30$ a month, period.” with 25$ in fine print for the phone. No matter what they do to simplify plans, if marketing doesn’t start being morally honest about the total cost to the consumer, customers will not be happy. Honest, means the plan + phone + tax price must be the largest font size on the TV screen. Not just showing them a cheap monthly plan as the biggest number and the other half of the cost in fine print or a super fast voice over.

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