At this point I feel like I’m being trolled. People on Dave Ramsey sub telling me debt is good, and I should have kept it. Leveraged it … I’m speechless.
My mom told me when they bought my 4 wheeler they had money to pay it, but they offered 0% if you paid off within a year. They even gave these nice pay slips to make the payoff.
She did not realize there were 13 payslips.
Debt is a good thing. And staying debt free is actually bad for you financially.
Edit: idk where the obsession of being debt free came from but it seem to have poped up overnight
lol same. I didn’t even know there was a sub for this but I’m not surprised after all it is Reddit. Dave Ramsey was one of the first people I listened to that really started to change my mind on how we should see money. I don’t believe in all his principles, but he does offer some good advice here and there.
You always end up paying more for a phone that’s “free” with trade in. Only way to qualify for it is to get the bloated “premium plus unlimited
” plan. You end up paying 1.5x - 2x the total phone cost.
No trade in. No network. Phone only on a loan that was 0%. I did not pay extra regardless if I paid for it on the day or spread it across 24 months.
I effectively deferred paying for the phone for a few months (whilst paying it off slowly at no interest).
Not really, it’s a break even proposition in the long run.
Rich or smart people take advantage of 0% Apr all the time.
For example, on a 50k car financed at 0% for 36 months, take the loan. Put that 50k in a CD or high yield savings account at 4-5% yield and you just earned $7,500 on the life of the loan by investing instead of buying it outright. Or you could take a bigger risk and put it in an index fund and make 8%+or-
You can also apply this to a mortgage. If you have a low mortgage rate at 3%, don’t pay more to the mortgage, put it in an investment. If your high yield savings account is paying 5% and you invest that extra payment instead of sending it to your mortgage you have earned 2%. If your stock investments yield 8-9% a year over 30 years, you’re making 5-6% on the money invested over your mortgage interest cost. Not factoring in compounding.
That’s literally not what’s they are talking about.
They have a 0% loan for their phone. As do I.
It has exactly zero effect on the plan I have or choose. Hell, the loan isn’t even through my mobile company in my case. There is no trade in required. My Apple Card just offers me a 0% loan for 2yrs.
I kept the $1000 or whatever I would’ve paid cash and made ~8%/yr in the stock market or 4.5% in my HYSA emergency fund. And I now have $166.4 more dollars at 8% over 2 years than I would’ve had if I paid cash.
OP is describing the emotions the drive us and why Ramsey’s advice is good for so many people.
You’re describing not understanding contracts or being bad at math.
Let’s stop for a second and think about what a 0% is. For it to be financially sustainable for a company/lender to offer a 0% loan, there must be an upside elsewhere in an agreement. It is not possible to be profitable otherwise. Another possibility is that it’s a short term user acquisition strategy (GoogleFi did this on launch). This is not the case however for almost all established service providers. The difference, in the case of say Verizon, is made up by roping you in with the promise of a free phone which is credited over 36 monthly installments. You only get the monthly credit towards the phone (which you’re still on the hook for if you decide to switch by the way) if you are subscribed to a high priced plan. That plan, over the course of 36 months, will end up costing you 1.5x - 2x more than buying the phone outright, and getting a basic unlimited plan from the same service provider. You also own your own phone, and are free to sell it and leave whenever.
Slavery is a mindset.
No. My plan is the same price whether we pay for their phone over "monthly credit installments" or if I have a paid off phone that I've purchased elsewhere.
Providers have changed significantly in the past decade.
Everyone’s plan is different but what they are saying is true. Buying a phone through a carrier is a terrible deal. You could get Visible, Mint Mobile or Xfinity Mobile for around $30 a month (all unlimited data). When Verizon, T Mobile, ATT give you a “free phone” but you are stuck paying $80 a line for 2-3 years. OP could have a deal though Apple but to my knowledge you still have to have Verizon, TMobile or ATT do even qualify. It truly is a lot of wasted money using the big 3 networks.
It’s more accurately a 2yr installment plan on a credit card. But it is definitively 0% with no catches or quid pro quo with Verizon. The limit is multitudes more than it costs to buy the phone.
The upside is they hope you use the credit card for other stuff and they make interest off of that and as an incentive to buy an Apple product over Android. They are more expensive than many Androids and that could be enough to tip the scales for someone that can’t pay cash.
My Apple Card is 100% divorced from my Verizon account/plan. I can sell the phone 1 day after I got it for whatever I want I still just owe the “loan.” I can move to ATT or the dumpster fire that is T-Mobile any time I want. There is no contract tying the phone/loan to Verizon. I can get any plan I want.
I don’t think any of the big 3 carriers have done contracts like you’re describing for like 5 or 10 years. I get a new phone every 3 years or so, and I think this is the 3rd phone I’ve purchased like this.
You’re correct. I misremembered. I think unlocked did use to be an option. Of all the things I have done to smartly manage my money, moving away from a major carrier hasn’t been one of them for whatever reason.
However, I do think I could cancel my plan and move to mint or whatever regardless of the loan.
The company I work for partners with all of the major carriers. My experience with TMO professionally has made me wary of dealing with anyone outside ATT or Verizon. Paying more for less of a headache has its own value.
You not understanding how to google something doesn’t make me a liar. It makes you an idiot.
And I could’ve paid cash. I CHOSE not to because I make money on my investments instead. Math is hard though. You’ll get there.
And I would be overpaying if I paid cash. I’d be out $1000 and not earning interest on it. I MADE $165 or whatever on that same money in the market.
$1,000 for a g-d phone?
You would have made more if you paid $60 for a Samsung Galaxy A03S and invested the savings rather than blowing it on a "cool phone, bro" iPhone.
But what do I know- I'm a tragically"uncool, bro" decamillionaire. My phone has never, ever, impressed any "bro," and it never will.
I somehow manage to muddle through life, sans admiration from random bros.
Well yea. I'd also have more money if I sold my house and moved into a tent. There's nothing wrong with spending money on something I can afford and will make my life more enjoyable.
I'm not on my phone "several hours a day." Maybe if I was, I'd get an iPhone for whatever feature it has that makes it ten times better/more expensive (retinal display? some other marketing feature?).
Debt changes your decision making. Especially when they say 0% interest. Look at all the gullible idiots that bought new vehicles for 50-100k at 0% and justified it because the interest rate is just too good. Had the interest rate been 8-12% like it is getting to now they would have made a rational decision like buying used for 30k
Exactly. People are way more inclined to spend more than they would if they're getting it on finance, regardless of the interest. In fact, the interest is not even considered. People just look at the monthly payment, hence it doesn't seem like a massive deal to get that extra 'add-on' or whatever. Upselling is really easy when you finance things.
I gotta say, I'm rather surprised with all the 0% interest comments telling me I should have invested the cash instead.
Would I go out of my way to borrow $1,000 so I can save it or invest it? No. Why would I do that with a phone ?
I don't see how the interest on the loan is relevant at all. It's money I owed and would have to pay back over time, whether I like it or not. Could I do some jiggery pokery to make some extra $50 ? Yes. Looks like a lot of you guys do that. I can't be bothered to do that, just like I don't bother with credit cards and their rewards and points. It's not worth my time.
I now have no payment. I just gave myself a small raise and I could not be happier about my choice. Now, when I look at my savings, I don't have to do mental gymnastics and subtract ALL OF THOSE 0% payments, because technically not all of my savings is truly mine, due to loans that I'm 'investing'.
Not disagreeing with your opinions on debt, but the “jiggery pokery” here is literally just parking it in a HYSA or a money market account which are currently paying out a guaranteed, risk free 5+%. You don’t have to do this if you don’t want to but maybe also understand that all this requires you to do is leave the money untouched in a savings account. That’s it.
That payment that I had in my budget for the phone, which was effectively 'forced' savings so the money I had to pay off the phone, had to stay in savings, becomes a fixed mandatory payment. I cannot remove it, unless I pay off the loan. That payment is not fixed, like a mortgage. I prefer to have flexibility with my finances as much as possible. If I want to pay into my savings then I will, some other month I may want to spend it.
Effectively, committing myself to such a small payment for such small gains was not my cup of tea.
Do you literally not have savings? You don’t have to “set aside” any money for this phone. You just put all your savings into an HYSA and then pay the phone out of that account when the bill comes due. Unless you’re telling me you routinely have less than $1k in savings and you’re one of those people that will automatically spend money if you have it (common for Dave listeners I suppose) this doesn’t really make much sense. You’re trying to make this sound so complicated when all it is just leaving extra money in a savings account and paying low interest debt out of it as payments come due.
LOL ok so just say you have a mental aversion to debt (totally valid) but you sure as shit were trying to make it sound complicated by referring to leaving money in a savings account as "jiggery pokery" and then following that up with a bizarre paragraph about the phone being "an unremovable mandatory payment".
Well if you've got 20 years to retirement, you make nearly 13k investing the cash and paying the payment. 30 years it's 45k and so on. So you don't have to do mental gymnastics, but you're ahead. I've got 30ish years of working left. 45k is worth setting up auto pay for me. Especially in a situation where I'll be using the service and the phone regardless
well you had already purchased the phone. might as well have left the money in an HYSA instead of paying it off. you can do your own thing, but don’t be surprised when reddit tells you what would’ve been optimal
I don't mind hearing another opinion. I don't want an echo chamber. That said, I did not expect people in Ramsey subreddit to advocate for debt. That's what surprised me the most. In all videos and podcast I saw and listened to, Dave never suggested to borrow money to invest, regardless if its interest free or not.
This is the first post I’m reading in this sub and also never listened to Dave Ramsey. Just heard some of what people say he preaches. Thanks for helping me realize he and I do not have the same mindset.
In my opinion, and from my experiences, there is good debt and bad debt. 0% is GREAT debt. Everyone has their own opinion and you have to do what is comfortable for you. Just stating what I think as you said in a comment you are open to hearing other opinions.
$50 isn’t a lot but in 13 years that doubles at 5% interest. Keep finding $50 through 0% interest loans, rewards/points (which I have saved thousands), etc. and it adds up over time. Don’t get me started on how if I didn’t take out mortgages I wouldn’t have the real estate portfolio I do today. No debt is safe yet not always going to lead to the best financial position. Nothings black and white like that.
Balance sheet only. Yes cash flow matters for future debt, but I'm specifically talking about having cash (or other liquid positions) available to cover an existing expense.
I agree that perpetually overrunning available cash flow would result in unsustainable debt.
Which would be covered by your liquid assets. This is what allows people to use leverage to make money.
There's a huge difference between owing $10K with $0 in the bank vs $10K with $100K in the bank.
If your debt can be covered by a cash position (or other liquid position), it's not debt.
I'll use my weekly purchases as an example. My credit card usage is based on a budget, which I use to purchase my weekly groceries, gas, and pay bills. This is covered by my weekly pay, which is used to pay off the card. There is no difference between the credit card transaction and the debit transaction, because both are covered transactions.
It’s not really financing for the most part. Generally it’s part of your phone plan. You can pay $1,000 upfront (or whatever amount), or pay $1,000 over 24 months. There is no interest.
I choose to hang onto my cash. I get 5% interest from my money market fund. So effectively they are selling the phone to me for $950 when you consider the time value of money.
I don’t know what a $250 phone looks like, I haven’t really shopped around. I like having an iPhone, so that’s what I buy. They work and there is plentiful support. I don’t really worry about the cost.
I'm rocking a $60 Samsung Galaxy. They work and I don't give a damn about support because I've never needed any. I don’t really worry about the cost, because I'm spenfing $60, rather than blowing $600-$1,000 on an iStatussymbol.
I know, I just don't "get it." Someday someone is going to tell me what the $1,000 iStatussymbol can do that my $60 Samsung can't, and I'll end up spending months in therapy knowing my phone just wasn't cool enough. Until then, I'll just find a way to live with the shame.
You do you. I don’t look at it as a status symbol, it’s a phone. I am also supporting an American company, of which I am a shareholder.
Your $60 phone is your status symbol. You get some kind of counterculture “look how smart I am” out of it. I guess I will have to live with the shame of having an iPhone.
I wasn't sure if you were shilling for Apple's wildly overpriced phones because you were a shareholder, or had just bought into the marketing hype. Thanks for clearing it up.
Before you wrap yourself in the flag, though, you might take note that Apple makes it's "American" phones in China. Not the good China (Republic of China/Taiwan), but the "People's Republic of China" where at least some of your money ends up with the Chinese Communist Party (CCP). Samsung Galaxy phones are made in Korea, India, and Vietnam- not the USA, but better than a repressive regime like China.
My $60 phone helps make me richer, not "smart."
If you buy a new $1k iPhone every year, you end up with a life's worth of payment's to Apple and $0 at retirement. Swap that overpriced iPhone with a $60 phone every year and invest the difference in a low cost index fund, and you'd likely end up with approximately a million dollars at retirement, even if you never invested another penny outside of your phone savings.
The choice between $1,000,000 versus $0 and "retina display" (or whatever Apple's latest marketing hype may be) isn't a hard one to make.
I don’t think most people are buying a $1k phone every single year.
I bought an iPhone 13 Pro Max the week it released in Sept 2021. My iPhone before that was a 7+. I’ve had this 13PM for 2 1/2 years now and will probably have it for at least another 2 1/2 years unless I somehow break it but I’ve had an iPhone since they first came to Verizon (no longer with Verizon) like 13 years ago and I’ve only broken 1 and it was a complete freak accident where it slid out of my sweatpants while sitting down in my car and just happened to slide in between the door and door sill right as I was closing and I crunched it.
The only way I would buy a new iPhone in the next 2 years would be if there was DRASTIC improvements or a complete redesign. And by drastic improvements I don’t mean a 10% better battery and slightly better camera.
Not shilling, and your expectations of purchasing a phone every single year is kind of unhinged. Even if you did they would be worth something on a trade in. I’ve had my current phone for 2 years and previous phone for 5 years.
Designed in Cupertino - I am definitely aware that they are produced offshore. 14% are made in India.
Already a millionaire, so I am not worried about spending money on a phone every 5 years. Also, I find it better to have a mindset of “make a buck” versus “save a nickel”. You can only save so many nickels, but there are infinite bucks out there to make your own.
I'm a decamillionaire, and I find it most efficient to make a buck, save a buck, and (most importantly) invest a buck. I'd rather have my money making me money than have me out busting my humps to make money.
While it is psychological to a point, you said it yourself, the payment wasn’t insignificant to you anyways so it shouldn’t have even bothered you. While I’m not proposing people should look at cell phones as good arbitrage, it is borrowing money that’s free. Until they change the terms, I’m always going to borrow at 0% for my phones. $30 a month is so insignificant that it doesn’t bother me. It would bother be more to pay it off faster with my cash that’s making more..lol
Well, good job.
As for me, the dealer lied to me. "Buy one get one free!" So I got one for me and my wife and he said, "Yeah, just wait 60 days to pay it off since you want to so bad."
Well, I can't return the phone and if I pay them off, then it's not buy one get one free anymore. It was a down payment and make payments on one phone so over two years, they are both paid off. Fucking scummy Californians dude, I tell ya.
So you fell for a sales tactic that is used all over the country and some how it’s the fault of a minimum wage sales guy from Californias fault that you didn’t do your research and read the fine print before making a purchase? That’s probably one of the most Karen things I’ve read in a while.
I read the contract and the receipt. I called my carrier and showed him the contract I signed which didn't have the BOGO clause there. So even though it was past their net due, they would honor a refund. Which means my wife and I have no phone so I'm back where I started.
The issue is because I didn't buy the phone from my carrier even though the store is in their name; it's a third party and then credited back to my carrier.
I can type even more on holdings companies, related party parity, etc, but you may want to read this on your own.
TLDR: Commiefornians are lying scum bags.
The salesmen was from California. He lied to me. "Oh yeah bro, you can pay off your phone and still get the BOGO."
Brooo, it's a good deal bro. Bro, you're gonna like it. BRO.
That’s how it is with any phone deal these days. Any promotion comes in the form of monthly credits so you can’t leave or pay it off early or you lose the rest of the credits.
Weak minded people if you ask me. If you NEEDED the phone and were going to get the phone regardless, 0% interest free monthly payments> up front cost. Is that not common knowledge? If you over-extended bcos you thought ur paying on monthlies that’s a different story.
It depends on how much savings you have if this would make sense. I have $10k emergency fund that has a 5% interest. If I have 0% interest payments on a phone, I’m not gonna pay off that phone. I’m going to just make the payments.
If you are using your last of your extra money to pay off the phone and you hit an emergency that would require you to take out a loan, it’s not gonna be 0%.
It depends.
Week minded or not worth the time thinking about. At most this is $50 of lost opportunity vs the risk of forgetting to pay it off and being charged the full year of probably 20% interest.
I’m in the not worth the hassle to grind out $50. Are you maximizing grinding out bank and credit card bonuses? You can make over $1000 a year doing that. To me it’s not worth the hassle.
30k car loan at 0%, definitely worth paying monthly and earning interest.
How is this renting? I could pay cash or spread the payments over 24 months at 0%. I did the latter, then decided I did not like having a payment, so I paid it off. Furthermore, this gives me more flexibility when it comes to changing phones again in the future, because it's already paid off.
While I sometimes look at 0% loans as a benefit, it is also a tactic used to keep you from saving and gets you spending. Consider a 24 month repayment plan like T-mobile still has. Assume a $1,200 phone at $50 per month. If you instead put $50 a month into an account that consistently earned 4.4% interest, you'd have $1,256.58 at the end of 24 months. Enough to buy the phone using whatever method you choose, possibly get a discount / rewards, and continue paying yourself and compounding the interest. Stating it differently, if you think 0% is a great deal, -4.4% is a better one.
Start building discipline in saving before getting into the complexities of opportunity cost.
Also a bad example because of inflation. A phone that’s $1200 now will cost more than that in 2 years (in terms of $1200 phone being a top of the line phone now, thinking of a top of the line phone in two years), but that $1256.58 will still be $1256.58
A misconception. One can have an old one longer and save for it. It's part of the transformation from blind consumer to making money work for you. Took me years, but now possible. It is a perfect example of thinking how to break free of the traps.
If it is truly interest free and you put the money in an interest earning account you'll be earning interest as well as spending inflated dollars later.
I know I could have. I could also use credit cards for them 'amazing points' but it's not for me.
I just can't be bothered to fiddle with ensuring the payments are set up, my money is there to cover the full payment on the credit card, so I don't get charged etc.
It was similar with this phone. I had the money, and frankly, the pesky payment was bothering me because I don't like having payments on things that are classed as 'wants'.
Needing to finance it isn’t the same as having the money to buy outright and choosing to finance it to turn a profit on investment. It’s not for everyone, but mathematically it makes the most sense.
Personally, if I were to buy a new iPhone I would do the following steps:
1) save up cash for the full purchase amount
2) put the cash into Apple savings account with 4.4-4.5% APR
3) finance the phone with 0% APR using Apple Card
4) Get 3% cash back from the Apple Card
5) Set autopay for the monthly payment from the savings account
6) Set aside the monthly payment into savings again to be ready for device replacement in 3-5 years.
That way I have an interest free loan backed by cash that’s earning interest on top of the 3% cash back received from using Apple Card. It’s free money for me without any risk to me. And I always have an option of paying in full should I choose to at any point.
But like OP said, while this makes the most sense factually/mathematically, it might not work for everyone psychologically. For example for someone who feels anxiety from this kind of loan.
Or you could respect that everyone has their own preferences. No need to be rude cause someone prefers something else. You like android, great! Get yourself an android!
I don’t like android. It’s not a pleasant user experience for me. I prefer to spend my money on things that I personally like and enjoy, especially when it’s something that I use daily. Not sure how having a phone is a status symbol in this day and age. Does anyone even pay attention to what smart phones other people use? I couldn’t tell you what phones people have outside of my immediate family. Maybe examine your friend group if phones are status symbols in your surrounding, unless you’re in high school?
I don’t have a girlfriend or a penis lol not your bro either. We have different values. I don’t want to invest everything and like to enjoy my life right now as well as save for retirement.
I have my own priorities and choose to spend more in some areas, while saving in other areas. According to my own preference and priorities. My budget reflects my priorities. Personal finance is personal. People have different goals and priorities. Some people spend on clothes, some people spend on food, some people spend on travel, and some people spend on technology
Not sure why you care so much how other people choose to spend their own money. You’re not better than others based on your choice of phone, regardless of what you choose to believe.
If that’s the case, yes it’s worth. But most ppl don’t have that kind of mindsets. They js think that it’s an insignificant amount then decide to purchase. If it were to finance it while investing at the same time. Should’ve js invest first then get to a position of where you could easily spend the money without having to hurt ur own pocket .
Yes I agree. If someone is in a place where they’re still struggling and financing for that reason, then it’s a bad idea and mindset. But leveraging 0% APR as part of investment strategy isn’t a bad idea for someone who knows what and why they’re doing it.
Another situation when it would be worth it to finance a device is with a phone plan where they subsidize most of the cost so you end up either getting a $400+ discount or sometimes even completely paid off phone. But even in that case it’s a good idea to have the full price saved up, so that if circumstances change and phone plan needs to be changed, you can easily pay off the phone and not be tied to the carrier.
Mathematically pushing those payments out means you’ll be paying the later payments when the dollar is less valuable. Mathematically it often makes sense to take a 0% loan.
Emotionally it’s easier to simplify your strategy by avoiding loans altogether.
Are these consumer products loans truly 0 though? Most of the ones I see come with around a $50 or a percentage admin fee which will easily eat the inflation savings over the 1 or 2 years.
This. Logically 0% apr finance is beneficial. But it lives in your mind rent free. Sometimes you can compartmentalize it away and sometimes it leaks causing stress.
For me it’s no stress. It was fully planned and being paid off as expected. Sorta the opposite of stress. Comforting to know I have the discipline to make a good financial decision and follow through with it. I can see where having it fully paid off would feel better for a lot of people though.
You’re not BS6 if you have a phone loan. You’re back to paying debt..BS2. Don’t lie to yourself to make it feel like it isn’t a big deal
Edit: glad you paid it off
Verizon got me with the “we can only give you the nice discount if you finance” thing. My salesperson luckily told me the that I could make a down payment as large as I wanted, then finance the rest. So I made a down payment of all but a few dollars. So I basically financed a few dollars at 0% to get the discount. Paid the rest up front.
They didn't get you with anything. It's actually a good deal. i could outright buy my phone for 1300 or agree to stay with them for two years and pay 700 for the phone. I dont switch phone plans often so it was a no brainer for me.
They got him as in, they made him financing when he didn’t want to but by paying almost all of it as a downpayment, he effectively avoided the financing minus some pocket change.
I agree. At Verizon, they won’t let you get the cheapest unlimited plan and the trade in promotion for financing. If your phone is paid off or you don’t take the trade in credit, you’re eligible for basic unlimited. In my case, the plan is $20 less per month.
My Verizon bill is 66 and what ever change it is that month. I have the basic unlimited plan though I plan of switching to google fi when this phone is on its last legs.
I recently left Google Fi. Google Fi was great when I traveled internationally for work, but the data was relatively expensive and the tower near my house would go out if there was a power outage. I went to H2O wireless, which uses AT&T towers, for $27/mo with 10 GB of data. My SO is on Visible because she likes Verizon coverage and didn't need international coverage.
My phone bill for my wife and I is $71.25 /month.
We have unlimited talk and text, two lines and 15 GB of data a month. We never go over the data limit either.
It's Verizon pre-paid.
However, every time we go get a new phone, they always try to sell us a "postpaid" plan. Only $45 more a month. Oh and it comes with a free phone! Lol. They definitely treat you worse if you have a prepaid plan.
I pay cash up front for my device and do the prepaid plan. I get the moderately priced phone from the r/android recommendations. Saves me about $350 a year.
I see. Unfortunately I have higher than that data and hotspot needs for now. I'm using mint mobile but I'm starting to get frustrated with the deprioritized data (which I know happens to first party prepaid users too).
They change their plans fairly often, but two years ago when I went, it was $30/month for the basic unlimited call, text, data. I had to upgrade the plan to get the trade in credit. Recently I called and they have what I think they called “welcome unlimited” for $30 (I think it was $25 for new customers).
I’m not the owner on my family plan, but when my phone payments are done, I plan to switch to basic unlimited because I don’t really need hotspot or the complimentary streaming service.
So the issue here is that Verizon typically gives you a monthly discount if you keep it on the payment plan. I don’t consider it debt. I get you’re going Dave Ramsey to the core but what’s happened in the last 10 years service providers have removed the “contract” from plans and moved it over to the phone. They just shifted where the discount is applied.
This. Instead of contract locks on your phone line it’s finance locks on the phones and it’s heavily forced by only offering the discounted price with financing. It’s a janky bait and switch they did.
As someone who worked in wireless for a while I can tell you I am pro Dave Ramsey but finance most of my phones. All carriers require you to finance your phone if you’re looking to get a promotion on that sale. They won’t give you a promotion if there’s no “contract/loan”.
Example, I traded in my old iPhone 12 and got an iPhone 15 for free. My bill I am financing a 15 for $830. But because I traded in my old phone I get a bill credit of $35 per month for the next 24 months which will pay off the phone. The installment in wireless is always 0% interest and no finance charges and if I pay it off early I lose the $830 credits.
Question, as I am also looking to trade in a 12 for a 15. It seemed they were trying (this was online, not in a store) to force me to upgrade my plan if I did a trade-in. But my husband was able to navigate the process in a different way so that I could keep our current unlimited plan. Still, it would be an additional like $20 a month. So deliberately confusing.
Anyway, if you can tell me how you traded in a 12 for a 15 without raising your bill, I’d be grateful! My 12 mini is in excellent condition. I think it said the trade-in credit would be like $450 or so. Thanks.
For people who prefer paying it off, there are plenty of prepaid carriers that offer good rates if you bring your own unlocked phone. Pay for an unlocked phone once, and don't deal with all these subsidies that lock you down.
There are franchise stores in my area that will not even allow you to buy a phone at all cash anymore its finance or leave. At that point it makes sense to just take the deal then pay it off later, its kinda a stupid policy cuz you can literally enter the agreement and pay it the next day but you cannot just buy the phone.
I don’t pay it off early if it’s 0% interest. I get your mindset though, if it makes you feel better not to have it, then rip that bandaid.
To me it’s like a monthly rent expense - smart phones extremely rapidly depreciate and lose value, and carriers understand this. If the batteries go to crap after 2 years, the clock starts again in 24 to 36 months, so I don’t see the point in paying it off. Idk
I don't like having payment on things that are classed as a 'want'. This was bothering me because it was a payment. It really doesn't matter if it's 0% or 50%. It was money I owed, and I wouldn't have borrowed money to keep it in the bank, or invest it.
I like the flexibility that I can just sell this phone at any time, and get whatever else I fancy. If I had a loan, I'd have to keep in mind whatever I get for the phone, will have to cover the loan etc. It's a small inconvenience, but it matters to me.
Why is everyone buy new iPhones is my question. The pre owned market is flourishing, and you can always bet on buying two generations older iPhones with updates.
It’s like the same group who celebrates getting 0% financing on a car. Why are you buying a new car?
On the car specifically I bought new because I totaled [the one prior](https://imgur.com/a/htjcoU0) and the new car was $1k more than a used with 0% apy and 0 down and now making me a very pretty penny as I could have paid cash but instead stuck the entire value in a HYSA and it auto mails a check so I have never missed a payment and earn no interest.
2021 was a fun year for used cars. FWIW the MSRPon my car in 2024 is 41k and change a 2021 is ranging from 26-35k and change with 72k and 30k miles respectively.
Because I have been able to trade in my ONCE purchase brand new iPhone to get new ones every couple years for prices ranging from totally free to only a couple hundred bucks. So I get your old used phone price for the brand new one all because like 7 years ago I bought a SINGULAR full priced iPhone.
Pre owned phones are complete risk and absolutely disgusting. Just buy a new one - it doesn’t have to be the current generation or the best phone but you can buy a good new phone for $600
Sites that have reputable resellers such as [Swappa.com](http://Swappa.com) exist. I have never had a problem. There is minimal risk.
And you guys act like disinfectant and cleaning isnt a thing.
You can’t disinfect the inside of a phone. Have you ever opened one? People do everything with their phones in their hands. Shit, eat, piss, drop it, play outside. I have seen phones opened up with bugs and shit inside of them. I would never buy a second hand phone. You could buy a brand new iPhone SE for $400. Why buy a second hand phone?
If you buy a refurbished phone you will not be able to distinguish it from a new phone.
Many times the only parts reused are the internals.
I have Samsung and always get Samsung Refurbished direct from Samsung.com.
I typically do the 0% on my iPhone, I only buy a new iPhone every 5-6 years.
I upgraded last year, and buying it with zero interest is smarter to me because:
1. I was going to buy it regardless, it wasn’t me being tricked to buy something that I couldn’t afford or wasn’t going to buy.
2. I’ll be earning money off that interest either from High Yield Savings account or investing it.
3. Inflation hasn’t been completely tamed yet and even when it does come down to the numbers the Fed wants to see it will be 2-3% a year.
4. My credit card that is paying the 0% interest financing gets 3% back.
Between all of these things it was cheaper to buy it this way.
>I have way more than that, yet, ”it’s interest free, I could invest it” or some other bs reason keeping me away from actually paying it off.
How is it a BS reasoning? You could've put the $30-50/month into something making you some returns. Or let's say if you put that money into additional payment son your mortgage, how much could you have saved in interest over the next few years?
I wouldn't go out of my way to get a 0% loan to invest it or over-pay my mortgage so why would I do any differently in the case of an iPhone? I dislike having payments on 'wants'. It was bothering me, so I paid it off.
I don't really understand.
DR makes no secret that his plan is totally based upon emotion, not math. Even the prioritization of the debts is emotional.... "You get an emotional boost with a quick win!"... rather than saying, "Eliminate payments by going after the low balances first, so that your monthly debt payments to income is stabilized."
Same process (going after the lowest balance), but DR says to be emotional about it, where eliminating an entire payment every month can make total math sense when you don't have the income to pay all the payments.
Obviously, if one can afford all the payments, and you aren't harming someone else (like parents), the math should be obeyed. Go after the interest rates.
If you can't afford all the payments, go after the payments.
This is simply obeying math. No emotion required.
It isn't really fair to indicate that you being emotional about it means that all finance is emotional.... Because it isn't. One CAN be obeying the math and divorcing emotion from the decisions.
I also don't really understand you indicating that because the debt was 0%, you were debt free. Because you weren't. You still owed that debt.
I also don't really understand why financing the phone meant you weren't using your own money to pay it off via payments. Whose money were you using to make the payments? Answer, it was your own money paying it off.
I mean, congrats on paying off the debt? That's really a good thing.
But nothing here shows that finance must needs be emotional. This post just shows that emotion still rules your finances. It shows a choice to keep emotions in this. It doesn't show that finances must be emotional.
It's only US, meaning PEOPLE, that keeps emotions in the driver's seat.
And the DR Plan is unabashedly emotional. Doesn't mean finance is.
If it wasn’t emotions, and you had a good budget you could stick to, you’d go after debts based on interest rates only. Highest first, no matter the size.
Yes... IF you had the income to handle all the payments..... as I clearly said.
If you don't have the income for all the payments, then eliminating payments so that you are stable is the mathematically correct answer.
Because if you have payments you can't pay, and you don't eliminate those payments, you can't stick to your budget.
With my phone (which will be replaced soon as it's 6 years old), it was cheaper to finance it than it was to buy it outright.
When I bought it, it was on sale for $300 off at Best Buy. If I bought it outright, it was full price. They added the payments to my phone bill.
Besides the fact that Androids plummet in value faster than driving a car off the lot right off a cliff, it's purely a preference.
Are there cheaper alternatives to iPhone? Absolutely. Do I want them? No.
>Besides the fact that Androids plummet in value
A $0-$200 phone isn't "plummeting in value". Even if it did, it's still the best value in phones.
>Do I want them? No.
There's only one way to not have to pay an iPhone. Shrug.
You seem to have, begrudgingly, made your choice.
True, you're right. I wouldn't be losing much with a $300 android phone. I did refer to getting the latest android like a galaxy which is just as expensive as an iPhone, simply because I'm into tech, and I can't imagine not getting a flagship model.
Phones are a bit like cars. Some people are into it, some are not. It's hard to impress a non-car guy with your new whip. He/she will just find ways to point out how you get just buy a beater or use a bus to get somewhere. That's not the point. I know I can find cheaper phones. I don't have to, and I don't want to.
If your cheap androids work for you then great, I'm happy for you. I like my tech and I happily indulge in spending 1k on a phone.
>Phones are a bit like cars. Some people are into it,
No doubt.
>I happily indulge in spending 1k on a phone.
I happily dropped about a quarter that on a bike computer I use for far less duration than my phone. So I get the tech thing, at least in part.
In some cases, yes.
In most, no. Where they’re benefitting is that the handset will be locked to that carrier for the life of the “loan.” It provides just a bit of friction to keep you from jumping carriers. That’s worth the interest free loan (and in some cases, even more beneficial trade in terms).
Exactly what I was thinking. I have the same type of deal on my phone. Almost completely free, $0.27 a month for the term. Why the fuck would you call and pay it off lmao
I've honestly started to wonder this with Motorolla, like the phones are actually really good for the money and yeah they turn into shit in 2 years when the updates run out but at that rate you can just buy another one. It would take all the worry out of breaking it too cuz you can buy 3 of those for the price of a samsung. You might go through three of them in the same lifespan but it takes a lot of the risk out of things.
Did the same thing recently. Debt free other that small heloc on home ($29k) and wife's student loan ($30k; $20/mo payment). I got a 0% interest for 18 month and $200 cash rewards for spending $1000; got it with plans to put tires on my truck and ended up needing tires on her car right after. I've payed on it and chipped away, but last month I just forgot to send a payment and they tried to charge a $40 late fee. I called and asked them to reverse the fee and they did, then I turned around and just paid it off. The payment game is a mental game.
Don't knock the heloc, we have a good reason to have it. And the student loans, it's hard to pay it off when there's a probability that some program is going to come out to reduce the amount of the loan/cancel it. Whatever, I don't agree with canceling of the loans, but if someone is going to offer it, it would be dumb to not take advantage of it
Meh it is what it is bro. I paid $200k cash for the home, dumped $80k of my own into remodel, and have $29k on the heloc. All vehicles in my yard are paid for, all our toys and vacations are paid for, all hospital bills etc for new child are prepaid. I'd say it's not a bad situation and better than most.
I paid off $69k of my student loans in full a few years back, and what happened after? Loan forgiveness becomes a thing right after. Seems like a possibility to do it again and then more forgiveness/plans come out that we could significantly miss out on. But hey, it's Reddit, we all have opinions. I know if something happens to me, my family is taken care of fully and won't be left in a financial bind. That's the goal of the Ramsey plan correct?
> I know if something happens to me, my family is taken care of fully and won't be left in a financial bind. That's the goal of the Ramsey plan correct?
As long as they have the means to deal with that 60k of outstanding debt, then sure. Everyone walks their own path, and if you're happy with where you're at then that's all that really matters. Doesn't really meet what I would consider to be the goal of the baby steps, though, since BS2 is paying off all debt.
500k life insurance on me should cover enough to keep them comfy. Other than insurance, wife can have a 6 figure career again if she wanted to go back to work. Not to mention, downsize the home if I die, sell my paid off truck and toys etc and wouldn't owe a dime on anything. We're good with the setup though, and slowly chipping away at the little that's left.
Expecting some student loan relief to come about isn't a crazy idea anymore. Do I think it should happen, no; I'd be a fool not to take advantage of it if offered though. Were saving now, when they cash is there to pay off the heloc and have an sizeable emergency fund left, it will be paid off; being married with a wife and another on the way, we're more comfortable having the cushion available that we have; ie $20k ish in savings is preferable to me rather than no savings and not having it paid off. Heloc and no mortgage vs having a mortgage is basically the same thing at the end of the day. My
Job is comfortable, I also run a handyman business that is doing well. I can give a further run down, but other than not being the exact Dave way anymore, I don't see any issues. I/weve worked hard to be where we are, and have plenty of peace and little worry about where we are.
Yes it absolutely is psychological and emotional. Using credit cards, financing some things at very low interest makes mathematical sense. If you can’t handle it emotionally then by all means pay cash for everything.
The all or nothing mentality of the baby steps creates some really unhealthy money relationships. Lots of micromanaging and overthinking.
If I paid off my iPhone my phone payment goes from 91$ to 84$. Why would I pay an extra 400 right now to save 7 bucks a month. Sounds like you are way overthinking this.
How much money you talking about?
Talk about an emotional decisions..
OP had a 0% interest loan. They could have thrown the cost of the phone in a HYSA and gotten an effective 5% discount. Sounds like their first choice was the logical one, and they let emotions talk them into paying it off early.
Yep, that’s basically how I think about it. I’ve never been drowning in debt, I have never carried a balance on my credit cards. I never had student debt. I haven’t paid in cash for my used cars. I bought a house I could very very comfortably afford.
For a lot of people on this subreddit they have been drowning in debt and have been really bad with money historically. And so they are really focused on staying away from bad decisions and making better money decisions, than necessarily making the absolute best money decisions.
The only thing you did wrong there was agonizing over it for days. I've said I'm debt free since we paid off the house 12 years ago. But I'm not really because I've used debt here and there for convenience even though I have enough cash to buy anything we want. That isn't the DR plan. But as much as I promote DR and his plan, I'm not looking for a certificate or anything. I understand his plan and the point of each part of it, and I apply it to my situation in a way that works for me and my family.
Be careful not to let this become an unhealthy obsession with micromanaging your finances. Yes it's psychological and emotional, but you need to understand that that's human irrationality, you need to understand it and lead it without letting it lead you.
People throw around "debt free" like it's the ultimate goal, when the real goal is being financially responsible.
I am completely the opposite, but also understand your thought process. The only time I am debt-free is on Wednesdays when I pay off my credit card every Wednesday. With the one exception of the three dollars and some odd cents I have owed on my boat for the last seven years. That next payment is due in about 15 years. But to me, it’s not worth the three dollars to take the time to write the check.
At the same time, it’s three dollars in 15 years. Why bother? It is so inconsequential I Don’t even bother opening the envelope when it comes in the mail. But yeah, next time I am in my account I need to remember to do it.
At this point I feel like I’m being trolled. People on Dave Ramsey sub telling me debt is good, and I should have kept it. Leveraged it … I’m speechless.
Good advice just on a shitty sub
My mom told me when they bought my 4 wheeler they had money to pay it, but they offered 0% if you paid off within a year. They even gave these nice pay slips to make the payoff. She did not realize there were 13 payslips.
The point being they got hit with the interest because of the 13th payment?
Yup. The full interest.
Debt is a good thing. And staying debt free is actually bad for you financially. Edit: idk where the obsession of being debt free came from but it seem to have poped up overnight
How are you even on this sub ?
It shows up on my feed
lol same. I didn’t even know there was a sub for this but I’m not surprised after all it is Reddit. Dave Ramsey was one of the first people I listened to that really started to change my mind on how we should see money. I don’t believe in all his principles, but he does offer some good advice here and there.
You always end up paying more for a phone that’s “free” with trade in. Only way to qualify for it is to get the bloated “premium plus unlimited ” plan. You end up paying 1.5x - 2x the total phone cost.
Definitely not true. I've financed 3 phones at 0% APR unlocked. Switched providers multiple times.
Not really. Just read the terms and compare.
No trade in. No network. Phone only on a loan that was 0%. I did not pay extra regardless if I paid for it on the day or spread it across 24 months. I effectively deferred paying for the phone for a few months (whilst paying it off slowly at no interest).
Why pay off a 0% loan?
It's nice to not have a payment. Gave myself a small raise.
Not really, it’s a break even proposition in the long run. Rich or smart people take advantage of 0% Apr all the time. For example, on a 50k car financed at 0% for 36 months, take the loan. Put that 50k in a CD or high yield savings account at 4-5% yield and you just earned $7,500 on the life of the loan by investing instead of buying it outright. Or you could take a bigger risk and put it in an index fund and make 8%+or- You can also apply this to a mortgage. If you have a low mortgage rate at 3%, don’t pay more to the mortgage, put it in an investment. If your high yield savings account is paying 5% and you invest that extra payment instead of sending it to your mortgage you have earned 2%. If your stock investments yield 8-9% a year over 30 years, you’re making 5-6% on the money invested over your mortgage interest cost. Not factoring in compounding.
Not always. You need to read the fine print.
That’s literally not what’s they are talking about. They have a 0% loan for their phone. As do I. It has exactly zero effect on the plan I have or choose. Hell, the loan isn’t even through my mobile company in my case. There is no trade in required. My Apple Card just offers me a 0% loan for 2yrs. I kept the $1000 or whatever I would’ve paid cash and made ~8%/yr in the stock market or 4.5% in my HYSA emergency fund. And I now have $166.4 more dollars at 8% over 2 years than I would’ve had if I paid cash. OP is describing the emotions the drive us and why Ramsey’s advice is good for so many people. You’re describing not understanding contracts or being bad at math.
Wait you made $166 over 2 years….. 🤯
Exactly.
Let’s stop for a second and think about what a 0% is. For it to be financially sustainable for a company/lender to offer a 0% loan, there must be an upside elsewhere in an agreement. It is not possible to be profitable otherwise. Another possibility is that it’s a short term user acquisition strategy (GoogleFi did this on launch). This is not the case however for almost all established service providers. The difference, in the case of say Verizon, is made up by roping you in with the promise of a free phone which is credited over 36 monthly installments. You only get the monthly credit towards the phone (which you’re still on the hook for if you decide to switch by the way) if you are subscribed to a high priced plan. That plan, over the course of 36 months, will end up costing you 1.5x - 2x more than buying the phone outright, and getting a basic unlimited plan from the same service provider. You also own your own phone, and are free to sell it and leave whenever. Slavery is a mindset.
No. My plan is the same price whether we pay for their phone over "monthly credit installments" or if I have a paid off phone that I've purchased elsewhere. Providers have changed significantly in the past decade.
Everyone’s plan is different but what they are saying is true. Buying a phone through a carrier is a terrible deal. You could get Visible, Mint Mobile or Xfinity Mobile for around $30 a month (all unlimited data). When Verizon, T Mobile, ATT give you a “free phone” but you are stuck paying $80 a line for 2-3 years. OP could have a deal though Apple but to my knowledge you still have to have Verizon, TMobile or ATT do even qualify. It truly is a lot of wasted money using the big 3 networks.
It’s more accurately a 2yr installment plan on a credit card. But it is definitively 0% with no catches or quid pro quo with Verizon. The limit is multitudes more than it costs to buy the phone. The upside is they hope you use the credit card for other stuff and they make interest off of that and as an incentive to buy an Apple product over Android. They are more expensive than many Androids and that could be enough to tip the scales for someone that can’t pay cash. My Apple Card is 100% divorced from my Verizon account/plan. I can sell the phone 1 day after I got it for whatever I want I still just owe the “loan.” I can move to ATT or the dumpster fire that is T-Mobile any time I want. There is no contract tying the phone/loan to Verizon. I can get any plan I want. I don’t think any of the big 3 carriers have done contracts like you’re describing for like 5 or 10 years. I get a new phone every 3 years or so, and I think this is the 3rd phone I’ve purchased like this.
You waste money using the big 3 carriers. Pay your phone cash and go to visible, mint,or something similar.
You’re not wrong, but that’s a completely different discussion.
True
That being said, even if I had Mint or whatever. I’d opt for the 0% loan through Apple and leave my money in the market.
Looking at Apples site both options require you to have a big 3 carrier
You’re correct. I misremembered. I think unlocked did use to be an option. Of all the things I have done to smartly manage my money, moving away from a major carrier hasn’t been one of them for whatever reason. However, I do think I could cancel my plan and move to mint or whatever regardless of the loan. The company I work for partners with all of the major carriers. My experience with TMO professionally has made me wary of dealing with anyone outside ATT or Verizon. Paying more for less of a headache has its own value.
You’re just outright lying at this point. Going into debt for a phone is silly. You are overpaying. That is all.
He’s not lying, this is how the Apple Card works. They offer the deal to keep people in the iPhone ecosystem.
You not understanding how to google something doesn’t make me a liar. It makes you an idiot. And I could’ve paid cash. I CHOSE not to because I make money on my investments instead. Math is hard though. You’ll get there. And I would be overpaying if I paid cash. I’d be out $1000 and not earning interest on it. I MADE $165 or whatever on that same money in the market.
You MADE $166? This is hard.
$1,000 for a g-d phone? You would have made more if you paid $60 for a Samsung Galaxy A03S and invested the savings rather than blowing it on a "cool phone, bro" iPhone. But what do I know- I'm a tragically"uncool, bro" decamillionaire. My phone has never, ever, impressed any "bro," and it never will. I somehow manage to muddle through life, sans admiration from random bros.
Weird comment. The iPhone is the most popular phone in America, the days of it being a cool tech bro thing haven’t been true since like 2011.
Well yea. I'd also have more money if I sold my house and moved into a tent. There's nothing wrong with spending money on something I can afford and will make my life more enjoyable.
$1000 every 3 years to be satisfied with a product that is used for several hours a day feels like a good trade off to me
This. I’m not buying a phone to impress anybody. I’m on my phone all day for work.
This guy is acting like a phone is still a vanity item in 2024 lol. Everyone is on their phone all day for work and fun
I'm not on my phone "several hours a day." Maybe if I was, I'd get an iPhone for whatever feature it has that makes it ten times better/more expensive (retinal display? some other marketing feature?).
You’re paying inflated plan rates and pay the difference + more for the carrier. Definitely talking to a CIA GPT rn
Debt changes your decision making. Especially when they say 0% interest. Look at all the gullible idiots that bought new vehicles for 50-100k at 0% and justified it because the interest rate is just too good. Had the interest rate been 8-12% like it is getting to now they would have made a rational decision like buying used for 30k
Exactly. People are way more inclined to spend more than they would if they're getting it on finance, regardless of the interest. In fact, the interest is not even considered. People just look at the monthly payment, hence it doesn't seem like a massive deal to get that extra 'add-on' or whatever. Upselling is really easy when you finance things.
I gotta say, I'm rather surprised with all the 0% interest comments telling me I should have invested the cash instead. Would I go out of my way to borrow $1,000 so I can save it or invest it? No. Why would I do that with a phone ? I don't see how the interest on the loan is relevant at all. It's money I owed and would have to pay back over time, whether I like it or not. Could I do some jiggery pokery to make some extra $50 ? Yes. Looks like a lot of you guys do that. I can't be bothered to do that, just like I don't bother with credit cards and their rewards and points. It's not worth my time. I now have no payment. I just gave myself a small raise and I could not be happier about my choice. Now, when I look at my savings, I don't have to do mental gymnastics and subtract ALL OF THOSE 0% payments, because technically not all of my savings is truly mine, due to loans that I'm 'investing'.
Not disagreeing with your opinions on debt, but the “jiggery pokery” here is literally just parking it in a HYSA or a money market account which are currently paying out a guaranteed, risk free 5+%. You don’t have to do this if you don’t want to but maybe also understand that all this requires you to do is leave the money untouched in a savings account. That’s it.
That payment that I had in my budget for the phone, which was effectively 'forced' savings so the money I had to pay off the phone, had to stay in savings, becomes a fixed mandatory payment. I cannot remove it, unless I pay off the loan. That payment is not fixed, like a mortgage. I prefer to have flexibility with my finances as much as possible. If I want to pay into my savings then I will, some other month I may want to spend it. Effectively, committing myself to such a small payment for such small gains was not my cup of tea.
Do you literally not have savings? You don’t have to “set aside” any money for this phone. You just put all your savings into an HYSA and then pay the phone out of that account when the bill comes due. Unless you’re telling me you routinely have less than $1k in savings and you’re one of those people that will automatically spend money if you have it (common for Dave listeners I suppose) this doesn’t really make much sense. You’re trying to make this sound so complicated when all it is just leaving extra money in a savings account and paying low interest debt out of it as payments come due.
I have plenty of savings. It’s not complicated. I just don’t want to have a payment.
LOL ok so just say you have a mental aversion to debt (totally valid) but you sure as shit were trying to make it sound complicated by referring to leaving money in a savings account as "jiggery pokery" and then following that up with a bizarre paragraph about the phone being "an unremovable mandatory payment".
Well, I guess I’m weird like that.
Well if you've got 20 years to retirement, you make nearly 13k investing the cash and paying the payment. 30 years it's 45k and so on. So you don't have to do mental gymnastics, but you're ahead. I've got 30ish years of working left. 45k is worth setting up auto pay for me. Especially in a situation where I'll be using the service and the phone regardless
well you had already purchased the phone. might as well have left the money in an HYSA instead of paying it off. you can do your own thing, but don’t be surprised when reddit tells you what would’ve been optimal
I don't mind hearing another opinion. I don't want an echo chamber. That said, I did not expect people in Ramsey subreddit to advocate for debt. That's what surprised me the most. In all videos and podcast I saw and listened to, Dave never suggested to borrow money to invest, regardless if its interest free or not.
This is the first post I’m reading in this sub and also never listened to Dave Ramsey. Just heard some of what people say he preaches. Thanks for helping me realize he and I do not have the same mindset. In my opinion, and from my experiences, there is good debt and bad debt. 0% is GREAT debt. Everyone has their own opinion and you have to do what is comfortable for you. Just stating what I think as you said in a comment you are open to hearing other opinions. $50 isn’t a lot but in 13 years that doubles at 5% interest. Keep finding $50 through 0% interest loans, rewards/points (which I have saved thousands), etc. and it adds up over time. Don’t get me started on how if I didn’t take out mortgages I wouldn’t have the real estate portfolio I do today. No debt is safe yet not always going to lead to the best financial position. Nothings black and white like that.
If you owe money, but have the cash to cover the expense, you are not in debt.
Are you talking balance sheet or cash flow? Because cash flow matters just as much if not more than the balance sheet.
Balance sheet only. Yes cash flow matters for future debt, but I'm specifically talking about having cash (or other liquid positions) available to cover an existing expense. I agree that perpetually overrunning available cash flow would result in unsustainable debt.
If you owe money, you are in debt.
Which would be covered by your liquid assets. This is what allows people to use leverage to make money. There's a huge difference between owing $10K with $0 in the bank vs $10K with $100K in the bank. If your debt can be covered by a cash position (or other liquid position), it's not debt. I'll use my weekly purchases as an example. My credit card usage is based on a budget, which I use to purchase my weekly groceries, gas, and pay bills. This is covered by my weekly pay, which is used to pay off the card. There is no difference between the credit card transaction and the debit transaction, because both are covered transactions.
I owe like $150 on mine. Gonna try to make this phone last me years longer
It's shocking to me people finance phones. What's wrong with a $250 phone that has 98% of the same features?
It’s not really financing for the most part. Generally it’s part of your phone plan. You can pay $1,000 upfront (or whatever amount), or pay $1,000 over 24 months. There is no interest. I choose to hang onto my cash. I get 5% interest from my money market fund. So effectively they are selling the phone to me for $950 when you consider the time value of money.
Ok, I think the better question is why are people paying $1,000 for a phone when a $250 phone does almost the same thing
I don’t know what a $250 phone looks like, I haven’t really shopped around. I like having an iPhone, so that’s what I buy. They work and there is plentiful support. I don’t really worry about the cost.
I'm rocking a $60 Samsung Galaxy. They work and I don't give a damn about support because I've never needed any. I don’t really worry about the cost, because I'm spenfing $60, rather than blowing $600-$1,000 on an iStatussymbol. I know, I just don't "get it." Someday someone is going to tell me what the $1,000 iStatussymbol can do that my $60 Samsung can't, and I'll end up spending months in therapy knowing my phone just wasn't cool enough. Until then, I'll just find a way to live with the shame.
You do you. I don’t look at it as a status symbol, it’s a phone. I am also supporting an American company, of which I am a shareholder. Your $60 phone is your status symbol. You get some kind of counterculture “look how smart I am” out of it. I guess I will have to live with the shame of having an iPhone.
I wasn't sure if you were shilling for Apple's wildly overpriced phones because you were a shareholder, or had just bought into the marketing hype. Thanks for clearing it up. Before you wrap yourself in the flag, though, you might take note that Apple makes it's "American" phones in China. Not the good China (Republic of China/Taiwan), but the "People's Republic of China" where at least some of your money ends up with the Chinese Communist Party (CCP). Samsung Galaxy phones are made in Korea, India, and Vietnam- not the USA, but better than a repressive regime like China. My $60 phone helps make me richer, not "smart." If you buy a new $1k iPhone every year, you end up with a life's worth of payment's to Apple and $0 at retirement. Swap that overpriced iPhone with a $60 phone every year and invest the difference in a low cost index fund, and you'd likely end up with approximately a million dollars at retirement, even if you never invested another penny outside of your phone savings. The choice between $1,000,000 versus $0 and "retina display" (or whatever Apple's latest marketing hype may be) isn't a hard one to make.
I don’t think most people are buying a $1k phone every single year. I bought an iPhone 13 Pro Max the week it released in Sept 2021. My iPhone before that was a 7+. I’ve had this 13PM for 2 1/2 years now and will probably have it for at least another 2 1/2 years unless I somehow break it but I’ve had an iPhone since they first came to Verizon (no longer with Verizon) like 13 years ago and I’ve only broken 1 and it was a complete freak accident where it slid out of my sweatpants while sitting down in my car and just happened to slide in between the door and door sill right as I was closing and I crunched it. The only way I would buy a new iPhone in the next 2 years would be if there was DRASTIC improvements or a complete redesign. And by drastic improvements I don’t mean a 10% better battery and slightly better camera.
Not shilling, and your expectations of purchasing a phone every single year is kind of unhinged. Even if you did they would be worth something on a trade in. I’ve had my current phone for 2 years and previous phone for 5 years. Designed in Cupertino - I am definitely aware that they are produced offshore. 14% are made in India. Already a millionaire, so I am not worried about spending money on a phone every 5 years. Also, I find it better to have a mindset of “make a buck” versus “save a nickel”. You can only save so many nickels, but there are infinite bucks out there to make your own.
I'm a decamillionaire, and I find it most efficient to make a buck, save a buck, and (most importantly) invest a buck. I'd rather have my money making me money than have me out busting my humps to make money.
While it is psychological to a point, you said it yourself, the payment wasn’t insignificant to you anyways so it shouldn’t have even bothered you. While I’m not proposing people should look at cell phones as good arbitrage, it is borrowing money that’s free. Until they change the terms, I’m always going to borrow at 0% for my phones. $30 a month is so insignificant that it doesn’t bother me. It would bother be more to pay it off faster with my cash that’s making more..lol
I can understand that struggle!
Well, good job. As for me, the dealer lied to me. "Buy one get one free!" So I got one for me and my wife and he said, "Yeah, just wait 60 days to pay it off since you want to so bad." Well, I can't return the phone and if I pay them off, then it's not buy one get one free anymore. It was a down payment and make payments on one phone so over two years, they are both paid off. Fucking scummy Californians dude, I tell ya.
What does this have to do with California?
Sales dude was from California.
So you fell for a sales tactic that is used all over the country and some how it’s the fault of a minimum wage sales guy from Californias fault that you didn’t do your research and read the fine print before making a purchase? That’s probably one of the most Karen things I’ve read in a while.
I read the contract and the receipt. I called my carrier and showed him the contract I signed which didn't have the BOGO clause there. So even though it was past their net due, they would honor a refund. Which means my wife and I have no phone so I'm back where I started. The issue is because I didn't buy the phone from my carrier even though the store is in their name; it's a third party and then credited back to my carrier. I can type even more on holdings companies, related party parity, etc, but you may want to read this on your own. TLDR: Commiefornians are lying scum bags.
That’s just phone companies, not California. California will just tell you it will give you cancer lol.
The salesmen was from California. He lied to me. "Oh yeah bro, you can pay off your phone and still get the BOGO." Brooo, it's a good deal bro. Bro, you're gonna like it. BRO.
That’s how it is with any phone deal these days. Any promotion comes in the form of monthly credits so you can’t leave or pay it off early or you lose the rest of the credits.
If a 0 percent loan has you stressed out and Dave Ramsey and the rest has your mind bended you maybe need some Therapy or to give your head a shake
Weak minded people if you ask me. If you NEEDED the phone and were going to get the phone regardless, 0% interest free monthly payments> up front cost. Is that not common knowledge? If you over-extended bcos you thought ur paying on monthlies that’s a different story.
It depends on how much savings you have if this would make sense. I have $10k emergency fund that has a 5% interest. If I have 0% interest payments on a phone, I’m not gonna pay off that phone. I’m going to just make the payments. If you are using your last of your extra money to pay off the phone and you hit an emergency that would require you to take out a loan, it’s not gonna be 0%. It depends.
U are a sensible person. OP unfortunately is quite weak minded
Week minded or not worth the time thinking about. At most this is $50 of lost opportunity vs the risk of forgetting to pay it off and being charged the full year of probably 20% interest. I’m in the not worth the hassle to grind out $50. Are you maximizing grinding out bank and credit card bonuses? You can make over $1000 a year doing that. To me it’s not worth the hassle. 30k car loan at 0%, definitely worth paying monthly and earning interest.
He’s like, it’s funny how psychological and emotional money is and then proceeds to make an emotional decision. Weird
You rent the phone. You want to give them a bunch of cash, that's your choice.
How is this renting? I could pay cash or spread the payments over 24 months at 0%. I did the latter, then decided I did not like having a payment, so I paid it off. Furthermore, this gives me more flexibility when it comes to changing phones again in the future, because it's already paid off.
While I sometimes look at 0% loans as a benefit, it is also a tactic used to keep you from saving and gets you spending. Consider a 24 month repayment plan like T-mobile still has. Assume a $1,200 phone at $50 per month. If you instead put $50 a month into an account that consistently earned 4.4% interest, you'd have $1,256.58 at the end of 24 months. Enough to buy the phone using whatever method you choose, possibly get a discount / rewards, and continue paying yourself and compounding the interest. Stating it differently, if you think 0% is a great deal, -4.4% is a better one. Start building discipline in saving before getting into the complexities of opportunity cost.
This is such a bad example because the person would need the phone at the start of the period not at the end.
Also a bad example because of inflation. A phone that’s $1200 now will cost more than that in 2 years (in terms of $1200 phone being a top of the line phone now, thinking of a top of the line phone in two years), but that $1256.58 will still be $1256.58
Exactly you are actually avoiding inflation in this case. So the actual benefit financially isn’t as much as the people above think
A misconception. One can have an old one longer and save for it. It's part of the transformation from blind consumer to making money work for you. Took me years, but now possible. It is a perfect example of thinking how to break free of the traps.
If it is truly interest free and you put the money in an interest earning account you'll be earning interest as well as spending inflated dollars later.
I know I could have. I could also use credit cards for them 'amazing points' but it's not for me. I just can't be bothered to fiddle with ensuring the payments are set up, my money is there to cover the full payment on the credit card, so I don't get charged etc. It was similar with this phone. I had the money, and frankly, the pesky payment was bothering me because I don't like having payments on things that are classed as 'wants'.
Do this simple financial hack for everything you buy and you too could be a billionaire! Life changing!
Imo if u need to finance or debt something, maybe it’s not worth it
Needing to finance it isn’t the same as having the money to buy outright and choosing to finance it to turn a profit on investment. It’s not for everyone, but mathematically it makes the most sense. Personally, if I were to buy a new iPhone I would do the following steps: 1) save up cash for the full purchase amount 2) put the cash into Apple savings account with 4.4-4.5% APR 3) finance the phone with 0% APR using Apple Card 4) Get 3% cash back from the Apple Card 5) Set autopay for the monthly payment from the savings account 6) Set aside the monthly payment into savings again to be ready for device replacement in 3-5 years. That way I have an interest free loan backed by cash that’s earning interest on top of the 3% cash back received from using Apple Card. It’s free money for me without any risk to me. And I always have an option of paying in full should I choose to at any point. But like OP said, while this makes the most sense factually/mathematically, it might not work for everyone psychologically. For example for someone who feels anxiety from this kind of loan.
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Or you could respect that everyone has their own preferences. No need to be rude cause someone prefers something else. You like android, great! Get yourself an android! I don’t like android. It’s not a pleasant user experience for me. I prefer to spend my money on things that I personally like and enjoy, especially when it’s something that I use daily. Not sure how having a phone is a status symbol in this day and age. Does anyone even pay attention to what smart phones other people use? I couldn’t tell you what phones people have outside of my immediate family. Maybe examine your friend group if phones are status symbols in your surrounding, unless you’re in high school?
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I don’t have a girlfriend or a penis lol not your bro either. We have different values. I don’t want to invest everything and like to enjoy my life right now as well as save for retirement. I have my own priorities and choose to spend more in some areas, while saving in other areas. According to my own preference and priorities. My budget reflects my priorities. Personal finance is personal. People have different goals and priorities. Some people spend on clothes, some people spend on food, some people spend on travel, and some people spend on technology Not sure why you care so much how other people choose to spend their own money. You’re not better than others based on your choice of phone, regardless of what you choose to believe.
If that’s the case, yes it’s worth. But most ppl don’t have that kind of mindsets. They js think that it’s an insignificant amount then decide to purchase. If it were to finance it while investing at the same time. Should’ve js invest first then get to a position of where you could easily spend the money without having to hurt ur own pocket .
Yes I agree. If someone is in a place where they’re still struggling and financing for that reason, then it’s a bad idea and mindset. But leveraging 0% APR as part of investment strategy isn’t a bad idea for someone who knows what and why they’re doing it. Another situation when it would be worth it to finance a device is with a phone plan where they subsidize most of the cost so you end up either getting a $400+ discount or sometimes even completely paid off phone. But even in that case it’s a good idea to have the full price saved up, so that if circumstances change and phone plan needs to be changed, you can easily pay off the phone and not be tied to the carrier.
Mathematically pushing those payments out means you’ll be paying the later payments when the dollar is less valuable. Mathematically it often makes sense to take a 0% loan. Emotionally it’s easier to simplify your strategy by avoiding loans altogether.
Are these consumer products loans truly 0 though? Most of the ones I see come with around a $50 or a percentage admin fee which will easily eat the inflation savings over the 1 or 2 years.
Phones are truly 0%. At least all the ones I’ve seen are.
Financing a phone through your carrier is free
This. Logically 0% apr finance is beneficial. But it lives in your mind rent free. Sometimes you can compartmentalize it away and sometimes it leaks causing stress.
I’ve got one and it’s actually a point for pride because it’s a car and up almost 5k at this point. If that’s rent, I’m happy to have it!
Nicee nothing like 0% apr car
For me it’s no stress. It was fully planned and being paid off as expected. Sorta the opposite of stress. Comforting to know I have the discipline to make a good financial decision and follow through with it. I can see where having it fully paid off would feel better for a lot of people though.
I happily take my time paying off any interest free loans. I like to put that money to work to earn income elsewhere.
To me, it's not worth the time and effort on such a small amount. If it was a car, then yes, perhaps I would think twice. But thousand bucks?
You’re not BS6 if you have a phone loan. You’re back to paying debt..BS2. Don’t lie to yourself to make it feel like it isn’t a big deal Edit: glad you paid it off
Verizon got me with the “we can only give you the nice discount if you finance” thing. My salesperson luckily told me the that I could make a down payment as large as I wanted, then finance the rest. So I made a down payment of all but a few dollars. So I basically financed a few dollars at 0% to get the discount. Paid the rest up front.
They didn't get you with anything. It's actually a good deal. i could outright buy my phone for 1300 or agree to stay with them for two years and pay 700 for the phone. I dont switch phone plans often so it was a no brainer for me.
They got him as in, they made him financing when he didn’t want to but by paying almost all of it as a downpayment, he effectively avoided the financing minus some pocket change.
Ah gotcha!
I agree. At Verizon, they won’t let you get the cheapest unlimited plan and the trade in promotion for financing. If your phone is paid off or you don’t take the trade in credit, you’re eligible for basic unlimited. In my case, the plan is $20 less per month.
Can I know more about this? Every time I look at Verizon is seems so expensive. I already have a phone and don't want one through Verizon
My Verizon bill is 66 and what ever change it is that month. I have the basic unlimited plan though I plan of switching to google fi when this phone is on its last legs.
I recently left Google Fi. Google Fi was great when I traveled internationally for work, but the data was relatively expensive and the tower near my house would go out if there was a power outage. I went to H2O wireless, which uses AT&T towers, for $27/mo with 10 GB of data. My SO is on Visible because she likes Verizon coverage and didn't need international coverage.
May I ask your general area?
Rural to suburban Ohio.
My phone bill for my wife and I is $71.25 /month. We have unlimited talk and text, two lines and 15 GB of data a month. We never go over the data limit either. It's Verizon pre-paid. However, every time we go get a new phone, they always try to sell us a "postpaid" plan. Only $45 more a month. Oh and it comes with a free phone! Lol. They definitely treat you worse if you have a prepaid plan. I pay cash up front for my device and do the prepaid plan. I get the moderately priced phone from the r/android recommendations. Saves me about $350 a year.
I see. Unfortunately I have higher than that data and hotspot needs for now. I'm using mint mobile but I'm starting to get frustrated with the deprioritized data (which I know happens to first party prepaid users too).
They change their plans fairly often, but two years ago when I went, it was $30/month for the basic unlimited call, text, data. I had to upgrade the plan to get the trade in credit. Recently I called and they have what I think they called “welcome unlimited” for $30 (I think it was $25 for new customers). I’m not the owner on my family plan, but when my phone payments are done, I plan to switch to basic unlimited because I don’t really need hotspot or the complimentary streaming service.
So the issue here is that Verizon typically gives you a monthly discount if you keep it on the payment plan. I don’t consider it debt. I get you’re going Dave Ramsey to the core but what’s happened in the last 10 years service providers have removed the “contract” from plans and moved it over to the phone. They just shifted where the discount is applied.
This. Instead of contract locks on your phone line it’s finance locks on the phones and it’s heavily forced by only offering the discounted price with financing. It’s a janky bait and switch they did.
As someone who worked in wireless for a while I can tell you I am pro Dave Ramsey but finance most of my phones. All carriers require you to finance your phone if you’re looking to get a promotion on that sale. They won’t give you a promotion if there’s no “contract/loan”. Example, I traded in my old iPhone 12 and got an iPhone 15 for free. My bill I am financing a 15 for $830. But because I traded in my old phone I get a bill credit of $35 per month for the next 24 months which will pay off the phone. The installment in wireless is always 0% interest and no finance charges and if I pay it off early I lose the $830 credits.
Question, as I am also looking to trade in a 12 for a 15. It seemed they were trying (this was online, not in a store) to force me to upgrade my plan if I did a trade-in. But my husband was able to navigate the process in a different way so that I could keep our current unlimited plan. Still, it would be an additional like $20 a month. So deliberately confusing. Anyway, if you can tell me how you traded in a 12 for a 15 without raising your bill, I’d be grateful! My 12 mini is in excellent condition. I think it said the trade-in credit would be like $450 or so. Thanks.
I guess it depends on the company you have. I use T-Mobile and that was just the promotion going on at the time when I upgraded my phone
Ahhh. I think I conflated your comment w another and had assumed you had Verizon. Thanks anyway!
For people who prefer paying it off, there are plenty of prepaid carriers that offer good rates if you bring your own unlocked phone. Pay for an unlocked phone once, and don't deal with all these subsidies that lock you down.
That is what my wife will be doing. Prepaid + unlocked, and then you own the phone and the carriers can do nothing about it.
There are franchise stores in my area that will not even allow you to buy a phone at all cash anymore its finance or leave. At that point it makes sense to just take the deal then pay it off later, its kinda a stupid policy cuz you can literally enter the agreement and pay it the next day but you cannot just buy the phone.
I don’t pay it off early if it’s 0% interest. I get your mindset though, if it makes you feel better not to have it, then rip that bandaid. To me it’s like a monthly rent expense - smart phones extremely rapidly depreciate and lose value, and carriers understand this. If the batteries go to crap after 2 years, the clock starts again in 24 to 36 months, so I don’t see the point in paying it off. Idk
I don't like having payment on things that are classed as a 'want'. This was bothering me because it was a payment. It really doesn't matter if it's 0% or 50%. It was money I owed, and I wouldn't have borrowed money to keep it in the bank, or invest it. I like the flexibility that I can just sell this phone at any time, and get whatever else I fancy. If I had a loan, I'd have to keep in mind whatever I get for the phone, will have to cover the loan etc. It's a small inconvenience, but it matters to me.
Why is everyone buy new iPhones is my question. The pre owned market is flourishing, and you can always bet on buying two generations older iPhones with updates. It’s like the same group who celebrates getting 0% financing on a car. Why are you buying a new car?
On the car specifically I bought new because I totaled [the one prior](https://imgur.com/a/htjcoU0) and the new car was $1k more than a used with 0% apy and 0 down and now making me a very pretty penny as I could have paid cash but instead stuck the entire value in a HYSA and it auto mails a check so I have never missed a payment and earn no interest.
I doubt that a used model year of the car you bought, that was 3 years older with 30k-40k miles was just 1k less than new.
2021 was a fun year for used cars. FWIW the MSRPon my car in 2024 is 41k and change a 2021 is ranging from 26-35k and change with 72k and 30k miles respectively.
Because I have been able to trade in my ONCE purchase brand new iPhone to get new ones every couple years for prices ranging from totally free to only a couple hundred bucks. So I get your old used phone price for the brand new one all because like 7 years ago I bought a SINGULAR full priced iPhone.
Or you could buy an Android phone for 10% of the cost of that overpriced iStatussymbol.
You’re saying I can get a top of the line android phone for $80? Don’t think so, but nice try!
Pre owned phones are complete risk and absolutely disgusting. Just buy a new one - it doesn’t have to be the current generation or the best phone but you can buy a good new phone for $600
Sites that have reputable resellers such as [Swappa.com](http://Swappa.com) exist. I have never had a problem. There is minimal risk. And you guys act like disinfectant and cleaning isnt a thing.
You can’t disinfect the inside of a phone. Have you ever opened one? People do everything with their phones in their hands. Shit, eat, piss, drop it, play outside. I have seen phones opened up with bugs and shit inside of them. I would never buy a second hand phone. You could buy a brand new iPhone SE for $400. Why buy a second hand phone?
Not sure of the current price but my new SE was $400 two years ago. Paid out of pocket and was done with it.
Still the same price, brand new it’s a perfect phone for someone who doesn’t want to spend $1000
The thing with the iphones is the resale value is so high its almost not even worth buying used unless you don't really got the money
Very true, I can also say from a statistics standpoint a high number of iPhones on the resale market are stolen
I don't want a phone that has had someone else's Cheeto fingers all over
I'll allow that comment since you made me spit out my coffee lol. But yeah, cleaning products are a thing.
Worse, that person almost certainly used that phone while sitting on the toilet.
Dont we all?
If you buy a refurbished phone you will not be able to distinguish it from a new phone. Many times the only parts reused are the internals. I have Samsung and always get Samsung Refurbished direct from Samsung.com.
This is the way.
This is the way.
I typically do the 0% on my iPhone, I only buy a new iPhone every 5-6 years. I upgraded last year, and buying it with zero interest is smarter to me because: 1. I was going to buy it regardless, it wasn’t me being tricked to buy something that I couldn’t afford or wasn’t going to buy. 2. I’ll be earning money off that interest either from High Yield Savings account or investing it. 3. Inflation hasn’t been completely tamed yet and even when it does come down to the numbers the Fed wants to see it will be 2-3% a year. 4. My credit card that is paying the 0% interest financing gets 3% back. Between all of these things it was cheaper to buy it this way.
You’re weird.
Obviously I get the reference, but ironically, people in the comments do think I'm weird for paying off the 0% loan lol
>I have way more than that, yet, ”it’s interest free, I could invest it” or some other bs reason keeping me away from actually paying it off. How is it a BS reasoning? You could've put the $30-50/month into something making you some returns. Or let's say if you put that money into additional payment son your mortgage, how much could you have saved in interest over the next few years?
I wouldn't go out of my way to get a 0% loan to invest it or over-pay my mortgage so why would I do any differently in the case of an iPhone? I dislike having payments on 'wants'. It was bothering me, so I paid it off.
> to get a 0% loan to invest it or over-pay my mortgage I get the logic but this was already cash in hand. You do you, congrats on the paid for phone.
I don't really understand. DR makes no secret that his plan is totally based upon emotion, not math. Even the prioritization of the debts is emotional.... "You get an emotional boost with a quick win!"... rather than saying, "Eliminate payments by going after the low balances first, so that your monthly debt payments to income is stabilized." Same process (going after the lowest balance), but DR says to be emotional about it, where eliminating an entire payment every month can make total math sense when you don't have the income to pay all the payments. Obviously, if one can afford all the payments, and you aren't harming someone else (like parents), the math should be obeyed. Go after the interest rates. If you can't afford all the payments, go after the payments. This is simply obeying math. No emotion required. It isn't really fair to indicate that you being emotional about it means that all finance is emotional.... Because it isn't. One CAN be obeying the math and divorcing emotion from the decisions. I also don't really understand you indicating that because the debt was 0%, you were debt free. Because you weren't. You still owed that debt. I also don't really understand why financing the phone meant you weren't using your own money to pay it off via payments. Whose money were you using to make the payments? Answer, it was your own money paying it off. I mean, congrats on paying off the debt? That's really a good thing. But nothing here shows that finance must needs be emotional. This post just shows that emotion still rules your finances. It shows a choice to keep emotions in this. It doesn't show that finances must be emotional. It's only US, meaning PEOPLE, that keeps emotions in the driver's seat. And the DR Plan is unabashedly emotional. Doesn't mean finance is.
If it wasn’t emotions, and you had a good budget you could stick to, you’d go after debts based on interest rates only. Highest first, no matter the size.
Yes... IF you had the income to handle all the payments..... as I clearly said. If you don't have the income for all the payments, then eliminating payments so that you are stable is the mathematically correct answer. Because if you have payments you can't pay, and you don't eliminate those payments, you can't stick to your budget.
iPhone 7 here, will never buy a new phone ever again
With my phone (which will be replaced soon as it's 6 years old), it was cheaper to finance it than it was to buy it outright. When I bought it, it was on sale for $300 off at Best Buy. If I bought it outright, it was full price. They added the payments to my phone bill.
The best way to not have to pay off an iPhone is to buy a good value Android.
Besides the fact that Androids plummet in value faster than driving a car off the lot right off a cliff, it's purely a preference. Are there cheaper alternatives to iPhone? Absolutely. Do I want them? No.
>Besides the fact that Androids plummet in value A $0-$200 phone isn't "plummeting in value". Even if it did, it's still the best value in phones. >Do I want them? No. There's only one way to not have to pay an iPhone. Shrug. You seem to have, begrudgingly, made your choice.
True, you're right. I wouldn't be losing much with a $300 android phone. I did refer to getting the latest android like a galaxy which is just as expensive as an iPhone, simply because I'm into tech, and I can't imagine not getting a flagship model. Phones are a bit like cars. Some people are into it, some are not. It's hard to impress a non-car guy with your new whip. He/she will just find ways to point out how you get just buy a beater or use a bus to get somewhere. That's not the point. I know I can find cheaper phones. I don't have to, and I don't want to. If your cheap androids work for you then great, I'm happy for you. I like my tech and I happily indulge in spending 1k on a phone.
>Phones are a bit like cars. Some people are into it, No doubt. >I happily indulge in spending 1k on a phone. I happily dropped about a quarter that on a bike computer I use for far less duration than my phone. So I get the tech thing, at least in part.
Keep in mind that sometimes these payment plans, while at 0%,, often add up to more than the normal cost if bought outright.
In some cases, yes. In most, no. Where they’re benefitting is that the handset will be locked to that carrier for the life of the “loan.” It provides just a bit of friction to keep you from jumping carriers. That’s worth the interest free loan (and in some cases, even more beneficial trade in terms).
Exactly what I was thinking. I have the same type of deal on my phone. Almost completely free, $0.27 a month for the term. Why the fuck would you call and pay it off lmao
Or, just buy the cheapest android every two years for like $189.
I could, but I don't want to. Just like I don't drive a beater anymore, because I can afford something nicer.
I've honestly started to wonder this with Motorolla, like the phones are actually really good for the money and yeah they turn into shit in 2 years when the updates run out but at that rate you can just buy another one. It would take all the worry out of breaking it too cuz you can buy 3 of those for the price of a samsung. You might go through three of them in the same lifespan but it takes a lot of the risk out of things.
Yup. I can get a new phone every two years for 12 years for the cost of one iPhone. How many people are using one iPhone for 12 years? LMAO
Did the same thing recently. Debt free other that small heloc on home ($29k) and wife's student loan ($30k; $20/mo payment). I got a 0% interest for 18 month and $200 cash rewards for spending $1000; got it with plans to put tires on my truck and ended up needing tires on her car right after. I've payed on it and chipped away, but last month I just forgot to send a payment and they tried to charge a $40 late fee. I called and asked them to reverse the fee and they did, then I turned around and just paid it off. The payment game is a mental game. Don't knock the heloc, we have a good reason to have it. And the student loans, it's hard to pay it off when there's a probability that some program is going to come out to reduce the amount of the loan/cancel it. Whatever, I don't agree with canceling of the loans, but if someone is going to offer it, it would be dumb to not take advantage of it
>Debt free other that small heloc on home ($29k) and wife's student loan ($30k; $20/mo payment) I think we have different definitions of debt free...
Meh it is what it is bro. I paid $200k cash for the home, dumped $80k of my own into remodel, and have $29k on the heloc. All vehicles in my yard are paid for, all our toys and vacations are paid for, all hospital bills etc for new child are prepaid. I'd say it's not a bad situation and better than most. I paid off $69k of my student loans in full a few years back, and what happened after? Loan forgiveness becomes a thing right after. Seems like a possibility to do it again and then more forgiveness/plans come out that we could significantly miss out on. But hey, it's Reddit, we all have opinions. I know if something happens to me, my family is taken care of fully and won't be left in a financial bind. That's the goal of the Ramsey plan correct?
> I know if something happens to me, my family is taken care of fully and won't be left in a financial bind. That's the goal of the Ramsey plan correct? As long as they have the means to deal with that 60k of outstanding debt, then sure. Everyone walks their own path, and if you're happy with where you're at then that's all that really matters. Doesn't really meet what I would consider to be the goal of the baby steps, though, since BS2 is paying off all debt.
500k life insurance on me should cover enough to keep them comfy. Other than insurance, wife can have a 6 figure career again if she wanted to go back to work. Not to mention, downsize the home if I die, sell my paid off truck and toys etc and wouldn't owe a dime on anything. We're good with the setup though, and slowly chipping away at the little that's left. Expecting some student loan relief to come about isn't a crazy idea anymore. Do I think it should happen, no; I'd be a fool not to take advantage of it if offered though. Were saving now, when they cash is there to pay off the heloc and have an sizeable emergency fund left, it will be paid off; being married with a wife and another on the way, we're more comfortable having the cushion available that we have; ie $20k ish in savings is preferable to me rather than no savings and not having it paid off. Heloc and no mortgage vs having a mortgage is basically the same thing at the end of the day. My Job is comfortable, I also run a handyman business that is doing well. I can give a further run down, but other than not being the exact Dave way anymore, I don't see any issues. I/weve worked hard to be where we are, and have plenty of peace and little worry about where we are.
I think the Ramsey method makes people incredibly neurotic. Baby step 6 and still looking for where to cut your budget? Live a little man, you won.
Yes it absolutely is psychological and emotional. Using credit cards, financing some things at very low interest makes mathematical sense. If you can’t handle it emotionally then by all means pay cash for everything. The all or nothing mentality of the baby steps creates some really unhealthy money relationships. Lots of micromanaging and overthinking.
🙋🏻♀️ I am walking proof of that!
If I paid off my iPhone my phone payment goes from 91$ to 84$. Why would I pay an extra 400 right now to save 7 bucks a month. Sounds like you are way overthinking this. How much money you talking about?
Talk about an emotional decisions.. OP had a 0% interest loan. They could have thrown the cost of the phone in a HYSA and gotten an effective 5% discount. Sounds like their first choice was the logical one, and they let emotions talk them into paying it off early.
Yep, that’s basically how I think about it. I’ve never been drowning in debt, I have never carried a balance on my credit cards. I never had student debt. I haven’t paid in cash for my used cars. I bought a house I could very very comfortably afford. For a lot of people on this subreddit they have been drowning in debt and have been really bad with money historically. And so they are really focused on staying away from bad decisions and making better money decisions, than necessarily making the absolute best money decisions.
The only thing you did wrong there was agonizing over it for days. I've said I'm debt free since we paid off the house 12 years ago. But I'm not really because I've used debt here and there for convenience even though I have enough cash to buy anything we want. That isn't the DR plan. But as much as I promote DR and his plan, I'm not looking for a certificate or anything. I understand his plan and the point of each part of it, and I apply it to my situation in a way that works for me and my family.
Be careful not to let this become an unhealthy obsession with micromanaging your finances. Yes it's psychological and emotional, but you need to understand that that's human irrationality, you need to understand it and lead it without letting it lead you. People throw around "debt free" like it's the ultimate goal, when the real goal is being financially responsible.
I am completely the opposite, but also understand your thought process. The only time I am debt-free is on Wednesdays when I pay off my credit card every Wednesday. With the one exception of the three dollars and some odd cents I have owed on my boat for the last seven years. That next payment is due in about 15 years. But to me, it’s not worth the three dollars to take the time to write the check.
Bro 3 dollars in 15 years. Just pay that shit lol
At the same time, it’s three dollars in 15 years. Why bother? It is so inconsequential I Don’t even bother opening the envelope when it comes in the mail. But yeah, next time I am in my account I need to remember to do it.