Prepaid vs Postpaid Cell Phone Plans: What Works Best for You?

The difference between prepaid and postpaid plans comes down to when you pay. With prepaid plans, you pay for your phone service up front, while with postpaid plans have you pay for your service at the end of a given billing cycle (and submit to a credit check).

But which one should you choose? We’ll break down prepaid and postpaid mobile plans in detail and explore their benefits so you can make a more informed decision. 

Want to compare the best phone plan deals among postpaid options? Our Plan Finder is free and unbiased. It can show you the best plans from top carriers based on your criteria.

What is a Prepaid Mobile Plan?

Prepaid cell phone plans are plans that let you pay for your service upfront and in full. Some prepaid phone carriers (like Mint Mobile) even let you pay several months to a year in advance, which is nice for anyone who wants to pay one lump sum and not have to think about it for a while. Prepaid plans also allow you to avoid a credit check.

Let's say you can choose a prepaidplan that comes with 5 GB of data and unlimited talk and text that costs a set amount per monthly bill. You pay that at the start of the billing period, and then get access to those benefits. If you stream too much Netflix on your phone the first week of your prepaid mobile plan and eat up all your data, the network will throttle your internet speed until the next billing cycle, or even cut off your data entirely. That can be frustrating, but most prepaid plans allow you to purchase additional one-time data packages if need be. 

Most prepaid plans are SIM-only, meaning that you don’t pay for the phone, just the coverage from the carrier. However, you may find some prepaid mobile plans that are packaged with phones, so you can pay for a new phone and immediately get cell service for a certain amount of time from a partner cell carrier. 

What Are the Benefits of Prepaid Mobile Plans?

The main benefits of prepaid mobile plans are flexibility and control over your spending. Simply put, it's easy to purchase a prepaid mobile plan for a given timeframe. Then, when you finalize the purchase, you know exactly how much you've spent on your cell phone bill for the short-term future.

That can make budgeting much more manageable, plus prevent you from overspending by accident. Furthermore, prepaid mobile plans make it easy to switch your mobile provider without much hassle. All you have to do is purchase a new SIM card and pay any accessory fees associated with switching to a new cell phone company. If you don’t have a good credit record, no worries: most prepaid plans don’t require one since you’re paying upfront. Also, as mentioned, prepaid carriers generally don't require a credit check when you sign up.

Is It Better To Go Prepaid or Postpaid?

Prepaid mobile plans are a great fit for anyone who wants predictable cell phone bills and wants to save a little money. If that’s you, you may find prepaid mobile plans more suitable and cost-effective than postpaid. However, postpaid plans tend to come packaged with extras that you won't find in prepaid ones—like streaming perks.

What is a Postpaid Wireless Plan?

With a postpaid plan, you receive a bill for a set monthly fee that you pay at the end of your billing cycle. The three biggest postpaid providers are T-Mobile, Verizon, and AT&T.

There are two types of postpaid plans, capped plans and unlimited plans. While unlimited plans are the norm among postpaid carriers, some wireless providers also offer capped plans (a.k.a. by-the-gig plans). With capped plans, there are data limits and fewer perks, but typically lower prices. With unlimited, you won’t get any surprise charges since it’s impossible to go “over” any limits (i.e., incur overages), you'll also enjoy more perks and better phone discounts. Of course, these advantages mean higher monthly fees.

Want help finding the right postpaid plan? Try our Plan Finder below to quickly compare cell phone plans based on your needs.

What Are the Benefits of Postpaid Wireless Plans?

The biggest benefits of postpaid mobile plans are the extra perks.

Most of the big cell carriers and companies also offer tons of perks and special features for signing up for postpaid mobile plans. These include streaming service subscriptions, special phone deals, and offers, in-flight Wi-Fi, faster streaming, hotspot data allowances, free upgrades after a certain number of months on your plan, and much more. You also have the option of adding devices such as smartwatches and tablets onto the plan, which you can’t do with prepaid plans. Families take note—it can also be more cost-effective to add several lines via a family plan, compared to prepaid plans.

Who Are Postpaid Mobile Plans Best For?

Postpaid mobile plans are ideal for folks looking who want to pay off a mobile phone over time. These plans can also help you save money on perks like streaming services. Since postpaid plans let you add multiple lines and often offer discounts on additional lines, they can be a good option for families.

Postpaid mobile plans can also be great for those who are very disciplined with data usage if you choose a limited data plan. 

How To Choose Between Prepaid vs. Postpaid Mobile Plans

If you use roughly the same amount of data each month, and if your cell usage is very consistent, a prepaid mobile plan could be right up your alley. 

On the other hand, if you’re looking for the best phone deals on the latest devices, you need multiple phone lines, or you want extra perks like streaming services, a postpaid mobile plan may be the better choice.

The Bottom Line

Both prepaid and postpaid mobile plans have benefits. To determine which you should pick, take a look at your budget, personal preferences, and how you use data and cell services. The long and short of it is that with prepaid plans, you pay for your phone service upfront, and with postpaid plans, you pay for your service at the end of a given billing cycle. 

Ultimately, only you can answer the question of which is best for you, but Navi can point you in the right direction. Our free, unbiased Plan Finder can help you find and compare cell phone plans based on your criteria in seconds.