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June 28th, 2018

Ever since everybody caught up to Apple’s debut of the first iPhone in 2007, smartphone upgrades went like this: you paid a few hundreds of dollars (or less if it wasn’t the latest and greatest), but most of the phone was paid off with a two-year wireless contract.

In two years, as your phone battery started to wear down and the phone got filled up with photos and videos you were too busy to delete, you thought about upgrading to a new phone with a better camera, more memory for your digital junk and faster speeds. You’d get a pretty decent trade-in on the phone you now owned and start the two-year cycle anew.

But over the past couple of years, things have started to change dramatically. It’s not your imagination that new, top-of-the-line phones from Apple, Samsung and others are getting more expensive. And people are upgrading more often as their mobile needs increase. Wireless carriers have shifted to pricier upgrade plans that spread out the cost of the phone and steer you toward an upgrade sooner, but you’re leasing the phone, not paying to own it.

Michelle Skupin, senior director of global corporate communications at Austin-based RetailMeNot, said for those who buy into the idea of a one-year upgrade cycle, “this is great for all involved.”  Carriers keep their customers, phone manufacturers sell more phones more often and customers get newer tech at the same monthly cost.

But that’s not the only path. You can also look at purchasing last year’s models at a steep discount, buying a used phone, doing an upgrade plan through the phone maker, switching carriers for a better deal or shocking everybody by just keeping your current phone.

Let’s explore the options and map out some smartphone strategies as we enter the summer season of new phone releases.

If you must have the latest phone every year

Look, there’s no shame in wanting the latest technology in your phone. If it’s a device you use all the time, every day, why shouldn’t you splurge on the fastest phone with the nicest screen and sharpest-picture-taking camera?

ContributedYanyan Ji, SVP Marketing and GM at ecoATM Gazelle

But expect to pay a lot, as we’re in the era of flagship phones such as the iPhone X and Samsung Galaxy Note8 that cost more than $1,000 when they debut. 

Yanyan Ji, SVP of marketing and GM at ecoATM Gazelle, which allows phone owners to trade in their devices for cash, points to research from IDC that phone prices are rising at about 9 percent a year.

“This rise in price can be attributed to the inclusion of more and more advanced technology in phones, such as AI, software and other features. Despite rising costs, device sales will continue to increase as consumers still have a desire to have the latest devices,” Ji said.

Ji says that a lot of ecoATM Gazelle customers are now upgrading every 12 to 18 months instead of two years at a time. 

There are a few ways to offset the “Ouch” factor of paying more than $1,000 for a new phone, however. In addition to carrier lease plans that promise a new phone every year for a monthly fee (say $30 to $50 a month plus data/voice charge), Apple and Samsung have their own upgrade plans that do largely the same thing and sometimes also offer an unlocked phone you can use to switch between carriers. It’s worth noting that with, say Apple’s Upgrade Plan, you have to pay sales tax for the entire cost of the device up front. In that case, a monthly plan might be more palatable.

Andrew Hoyle / Tribune News ServiceWith a long list of features you want and only a few that you don’t, there is no better budget phone than Motorola’s Moto G5 Plus, according to CNET.

Skupin at RetailMeNot suggests timing and flexibility can help, too. Wireless carriers sometimes offer huge financial incentives to switch from another wireless provider. Carriers who also sell TV and home internet service might also offer device or data-plan discounts for bundling with a phone plan.

And waiting a while after a phone’s launch for a promotion or sale can cut the cost, too.

“Last year, consumers could find great deals on Amazon Prime Day for phones such as Motorola and Samsung,” she said. “We also see an increased number of deals tied to the back-to-school shopping season” from late August into September.

If you own your current phone, selling or trading it in at the right time can also cut into that $1,000 price.

“To get the most of your trade-ins, you want to sell your phone when  your device is still the most current model and before a new model is released,” Ji said. “The newer your device and the better condition it is in, the more money you will receive for it.”  The value of a phone can drop 10 to 20 percent after a new model that replaces it goes on sale. 

Sites like Gazelle can lock in a price estimate for a given amount of time, say 30 days, so that there’s some overlap time and you’re not left without a phone when you send it in to trade.

If you’re OK with the next-best technology

There’s also no shame in avoiding the top-of-the-ladder race, especially if you’re upgrading from a phone that’s already a few generations old. 

You’ll see a huge performance boost and a much better camera phone by going from, say, an iPhone 5 to an iPhone 7 and save a lot of money versus going straight to an iPhone X. 

The best time to do that is when a new phone is introduced; all the older models get a price cut.

Justin Sullivan / Getty ImagesAn attendee inpsects the new iPhone SE during an Apple special event at the Apple headquarters on March 21, 2016 in Cupertino, California.

“This is great for the budget-conscious consumer who doesn’t necessarily need the latest technology,” Skupin said. 

There are also models from phone makers that are geared toward the more price-conscious, such as Apple’s iPhone SE and models from Motorola, Asus and LG on the Android side. 

You can search the sites of phone makers and wireless carrier for refurbished phones, which can sometimes be found at a steep discount. Or, if you are not tied to the idea of a brand-new phone fresh out of its cellophane peel, you can consider purchasing a model that some upgrading tech junkie just traded in.

Ji said that pre-owned iPhone Xs are already coming into the Gazelle marketplace at a rate of about 20 a month. “Consumers are seeing the value of buying pre-owned devices as they have not not been used long, are in good condition and still have a long life.” 

Ji said Texas is among the top three states for customers buying from that marketplace (the others are California and New York).

Again, trading in older devices, even ones that aren’t in much demand, can defray costs.

“There’s no such thing as a phone that is too old to trade in,”  Ji said. You might not get much cash for it, but if it’s just cluttering up a drawer in  your home or completely inoperable, it can at least be recycled responsibly.

If you’re already stressed out about the idea of upgrading 

If all this makes you nervous, there’s nothing wrong with just sitting out the next round of phone-upgrade mania. Upgrading a phone can mean re-upping a wireless carrier agreement, dealing with transferring your digital data from one phone to another, and having to purchase a different protective case if there’s a size or shape difference.

Who needs all those hassles if your phone is working fine and you don’t need more speed, space or extra features?

Korey Howell PhotographyMichelle Skupin, senior director of global corporate communications at RetailMeNot

You can still squeeze some extra life out of an older smartphone by having the battery replaced to get longer life out of each charge. If it’s a non-removable battery, you’ll want to have that done by a specialist if you’re leery of DIY-via-YouTube home upgrades.

An even cheaper option is carrying a small portable battery pack when you need it.

And if the problem with your older phone is that it’s just generally glitchy and slow, you might consider backing up your data, restoring the phone to its factory settings, then bringing your data back on to it. Restoring a phone can sometimes speed things up or at least get rid of some bad file juju that may be causing problems. 

Want to get the most out of a smart phone upgrade (or non-upgrade, even?). It helps to have a plan.

Cover image: The Samsung Galaxy S9, right, and S9+ debuted at the 2018 Mobile World Congress in Barcelona.  David Orr / For The Washington Post

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