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Using a credit card to pay for recurring expenses like cell phone bills has its upsides. It’s convenient, plus you can earn valuable points if you pay with a rewards card. And if you carry a card that offers cell phone insurance, you can skip paying for that coverage monthly through your mobile provider.
However, it’s always a good idea to review your mobile provider’s terms and conditions, as their pricing may differ depending on how you choose to pay. This can get even more complicated if you have an account with multiple phone lines. Before you default to a certain payment method, consider the pros and cons of various payment options.
When to pay your cell phone bill with a credit card
You qualify for an autopay discount
If you sign up for autopay and pay through your bank account or the mobile provider’s branded credit card, some providers knock a few bucks off of your monthly bills. It’s a no-effort way to save (plus you don’t risk forgetting to pay on time).
- Verizon offers a $10 monthly discount for autopay when you pay through your bank account or use the Verizon Visa® Card and enroll in paperless billing.
- T-Mobile’s autopay discount is $5 per line, up to $40, when you pay with your debit card, bank account or with the T-Mobile Visa.
- AT&T offers a $10 monthly discount per line for enrolling in autopay and paperless billing, but you must pay through your bank account, or with a debit card or the AT&T Points Plus card.
You can earn credit card rewards
Rewards credit cards shave 1% or more off the cost of recurring bills like cell phone plans. If your mobile provider doesn’t tack on additional fees to pay with a credit card, this is an opportunity to earn cash back or travel rewards. Even better, opt for a card that earns 2% back on all purchases, or a card that offers a higher ongoing rewards rate for cell phone bills.
But consider whether you’d get a bigger discount if you paid with a bank transfer and enrolled in autopay. Let’s say a four-line plan would cost you $200 a month. Enrolling in autopay and paying through a bank transfer could save you $40 a month, while earning 2% cash back on the plan (with no other discounts) would grant you only $4 a month.
You get cell phone insurance through your card
Built-in cell phone protection is a money-saving credit card perk. Protection plans through mobile providers can add nearly $20 to nearly $70 a month to your bill, depending on how many devices you need covered. Some credit cards, including a few with no annual fees, offer cell phone protection if you pay your bill with that card.
Just note that there are typically limits to how much you can claim (around $600 to $800), you may be limited in how many claims you can submit per year, and you’ll be subject to a deductible.
Another limitation is that none of the three cell phone credit cards mentioned above — the Verizon Visa® Card, the T-Mobile Visa and the AT&T Points Plus card — offer cell phone protection as a benefit. If you pay with a bank transfer or the mobile provider’s credit card and get the monthly discount, the cost of adding protection to your plan may exceed the discount. But if you pay with a card offering cell phone protection, you lose out on the autopay discount.
The better option for you depends on how many lines you have in your plan, and how accident-prone you and other members of your household are.
When to pay another way
If you don’t carry a provider’s credit card and you can earn credit card rewards on other expenses, you might be better off paying this specific bill with your debit card or via withdrawal from a bank account to get the autopay discount.
You’d have to pay separately for cell phone insurance in this case, so do the math to see whether the autopay discount meaningfully lowers the cost of coverage.
Make sure to compare the insurance coverage your cell phone provider offers with the cost of a third-party protection plan. Also, you can obviously skip cell phone insurance entirely — if you're brave.
