What are your thoughts on buying things like phones over months on 0% APR?

15 comments

1. It’s fine, as long as you can actually afford it and this is a way to optimise cash flow a bit and not just kicking the can down the road. The benefit isn’t huge, though, for most people.

2. No issue if it works for you.

   I’ve avoided phones on finance/contract for years now. Phone’s have become so powerful that you can pickup a midrange phone for <£300, so buying outright has worked for me.

   I’d probably rethink if I was buying the latest high end phone for £1000+, but I you lose a lot of value at that price bracket

3. Add up the payments over the compulsory 12 or 24 months, compare to how much it would be for a SIM only deal, and decide whether the new model of phone is worth all that.

   They also rely on people sticking to the contract after they’ve paid off the phone, at which point they’re being ripped off. Also if the phone is lost or stolen you still have to pay!

   Compare to say a £150 Motorola phone – do you really care about the extra functions or pixels etc to pay an extra £25 a month for 2 years (aka £600)?

4. I buy my phones through 0% finance with Apple (although it’s Barclays providing the loan).

   Normally get a trade in value for my old phone so brings the price down. Package that with a SIM only contract from a network and it works out cheaper to do it this way than to get a phone + contract deal from a network provider.

   Still stuck with a 24 month deal but that works out fine for me, not obsessed with upgrading but like the improved features of the newer iPhones after the period.

   Obviously if I didn’t want to upgrade I’d own the phone after the 24 months and just pay the network for my SIM contract whereas before I was still paying the high price for the phone + data/calls/minutes

5. I need a decent and reliable phone for work, which has a very good camera.

   I’ve done the sums and it’s a lot better to buy the phone on 0%apr and then get a basic sim package for myself plus being able to use my work sim as well, with more data, than it is to get a phone plus sim together via one of the phone companies.

   The thing to watch out for when comparing prices is that most of the phone companies quoted prices will be for 36 months, whereas the manufacturers offering credit quote for 24.

6. Bear in mind that if you go one day over the 0% interest period, you will be copped for interest on the whole amount you borrowed. Therefore, if the interest rate is 29% APR after the interest free period, you will pay 29% interest on the whole amount.

   If you can’t easily pay off the loan within the interest free period, it’s not a good idea.

7. I’ve purchased bikes and laptops using 0%. I’ll prefer to pay in full where possible, but if I don’t have the full amount and it’s not putting myself into monthly hardship taking on the payments I don’t see it as an issue.

8. I bought a laptop on 0% APR it was over 12 months, I paid it off in 9 months, cost me no more than buying from the start if I paid in cash, actually its probably a bonus as it boosted my credit rating. Just dont let them run away, pay them off as soon as possible and they are brilliant, saying this I dont have any other loans or anything (except a mortgage) so it may work better for me.

9. I did it with a iphone after buying 2nd cheap androids for a good few years.

   Its nice to have a decent phone but I dont really like apples model, so be careful that you know what you’re getting, cos you’re stuck with it over the loan period.

   i.e you have to pay monthly for decent storage space and as someone who likes a lot of music on my phone its not great. its all generally a bit meh – the good / bad seems to be the opposite from andriod.

10. It bothers me to commit to something I may really end up resenting if I ended up losing my job, for instance.

    I never would for a phone because I don’t get much utility from them.

11. I’m doing it with the iPhone now. It worked out cheaper than a two year tarriff just had to switch to a rolling 30 day sim deal.

12. If you can afford it, one advantage is the boost to your credit score. Two, is that against the action of inflation, the cost is getting cheaper, provided your salary/income is growing.

13. Even on 0% APR, you can’t afford to buy *too many* big ticket items and have them running at the same time. So yes, 0% finance is big and clever, but it doesn’t mean you can afford *more* things, it just means you can afford them *now* rather than save for them.

14. I do it with my phones. It doesn’t cost me any more to borrow the money and means I can keep my own money in my investments.

15. We’ve done it.

    Cheaper than buying one through contract with the phone company and have the money in the bank to pay it off in one should I need to.

    But why not use their 0% deal!