If you're on a budget, a brand new smartphone may not be the best choice. Even with a device payment plan, a new phone can add $30 to $50 a month to your cell phone bill. Nowadays, the latest smartphone may be priced higher than a 60-inch 4K television!
Fortunately, there are plenty of great options, even for the tightest of budgets. The used smartphone industry is growing exponentially. The International Data Corporation (IDC) estimates that the number of used smartphones in the refurbished phone market will increase from 81.3 million in 2015 to 222.6 million in 2020.
This high demand is due to multiple factors:
- The average smartphone cost is rising at a rate of 10% year-over-year and now sits at $363.
- Smartphone owners may recoup up to 50% of the original price when they sell their device, which is a good deal for both the buyer and the seller.
So how do you find a good condition used smartphone at an affordable price? Stay tuned, we'll answer that question in the following guide.
What exactly do we mean by "used phone"? There are two types of secondhand devices:
- Refurbished: This term refers to pre-owned devices that have been repaired and/or inspected and repackaged to be resold. These may be manufacturer refurbished phones or they may be serviced by a third party.
- Used: If a device is being sold simply as "used", that means the phone comes as-is. Even when this is the case, however, reputable websites test and verify the quality before selling the phone.
Terms used to indicate the condition of a used phone include:
- Excellent/Mint: The screen and body are in excellent condition. If there are blemishes, they are minimal.
- Good: The screen is very good. There may be small scuffs or nicks on the side or back.
- Fair: The screen is good. There are scuffs and nicks on the side and back. Blemishes are easily hidden with a cover.
The used smartphone market is nothing new. Apple and Samsung have been taking advantage of this demand for many years. In fact, the two hold close to 75 percent of market share in the refurbished phone industry.
Why Choose a Refurbished/Used Smartphone?
The advantages of buying a smartphone make it an obvious choice for the budget-conscious consumer:
- Third-party repair stores can fix cracked screens and other common issues for less than the cost of a new phone.
- Flagship price tags are driving consumers toward more affordable solutions.
- New smartphone models only offer minor upgrades compared to previous models. Waiting two or three years for a significant change to your favorite device makes much more sense - for you and your wallet.
Do You Really Need a New Smartphone?
That shiny brand new phone is tempting, I know. But consider this - why pay $200 for a bottom of the range Samsung when you can get a top of the range Samsung Galaxy from two years ago for the same price? You'll get better features like a bigger screen and better camera for about the same cost as that budget phone.
Has Your Carrier Offered You a "FREE" Upgrade?
It's time to recondition your thinking! Nothing in life is free and neither is the "FREE" phone your carrier is offering. The cost is simply bundled into your monthly price. Even worse, these payments lock you to a carrier even though major wireless companies aren't making customers sign contracts anymore.
Carriers should not dictate when you upgrade your phone, if it's one to two years old, there's probably no need to change it.
Key Considerations When Buying a Refurbished Smartphone Online
Even at a discount, a smartphone is a considerable investment. Take these factors into account when looking for used cell phones for sale:
- Warranty: Some sellers, like Gazelle, offer a 30-day warranty on their products. Others, like Swappa, don't offer this service.
- Returns: Most used phone marketplaces offer a 30-day no-fuss return policy for peace of mind. Some offer as long as 90 days to return your device.
- Shipping & Handling: This is typically included for free.
- Certification: Gazelle and Decluttr put their phones through rigorous tests before being sent out, similar to the way used car dealers inspect vehicles.
- Insurance: Third-party insurance companies like SquareTrade offer coverage on any phone, new or used. The cost is typically under $10 per month.
- Smartphone financing: Gazelle allows you to pay monthly if you choose, through a third-party financier called Affirm. This option is rarely a good deal as you'll typically pay high-interest rates. It's much better to simply pay in full.
Choosing your model
Once you've decided where you want to buy your phone, use the following tips to choose a model.
- Compatibility: There are two different technologies used in smartphones - GSM and CDMA (GSM - T-Mobile & AT&T, CDMA - Verizon & Sprint). While some phones can operate on both types of networks you'll have the best compatibility if you match the phone to the network's technology.
- Unlocking Your Smartphone: Most smartphones come locked to their carrier. The only exception is Verizon - most of their devices come already unlocked.
- If you do have a locked phone, however, it's not difficult to learn how to unlock it.
- Comparing Prices: You could jump around from site to site to find the best deal or you could just use our price comparison engine.
- Consider timing: People are eager to get rid of their old device so they can get their hands on the new one. So the best time to buy an iPhone 7 is when the iPhone 8 releases.
- Consider depreciation: Just like cars, some brands hold their value better than others. When buying a phone consider that Apple iPhones depreciate less than all other brands, followed by Samsung Galaxy.
- Pro Tip: There isn't much of a second-hand market for brands outside of Apple, Samsung, and Google. It's worth sticking with one of the big guns.
Pros and Cons of Used Smartphone Sellers
We've broken down the advantages and disadvantages of our favorite sites for selling your phone:
Compare Used Phones
We've done most of the work for you in finding the best deals on everything from Apple refurbished phones to Verizon used cell phones and Samsung refurbished phones. Compared used phones online quickly and easily.
Sell Your Current Phone
You can put cash in your pocket easily by selling your device while you're buying a new one. Find out everything you need to know about the best way to sell your old phone. Be sure to compare offers so you get the most money possible out of your device.
How To Save Even More Money
Now that you've saved a bundle on your next smartphone, why not save 50% or more on your cell phone service? Consider Switching To an MVNO:
Mobile Virtual Network Operators - or MVNOs - are smaller carriers that lease extra capacity from the major wireless carriers - AT&T, Verizon, T-Mobile, and Sprint - and sell it to consumers at a lower monthly cost. How are they doing this? They have lower overhead and spend much less on marketing. Most MVNOs don't have brick-and-mortar locations, which means you can sign up completely online without ever setting foot in a store.
Why choose an MVNO? You get:
- Lower rates
- The same 4G LTE mobile network you already enjoy
- No contracts or credit checks as most operate as prepaid carriers
- Customized plans so you only pay for what you actually need
- Simple online sign-up process, just swap SIM cards
- BYOP - bring your own phone (and keep your phone number)
Compare cell phone plans to find the best fit for you.
By simply changing your thinking about how to buy a smartphone and cell phone service you can save over half of what you're used to paying.