Buying an iPhone 6S: Understanding Your Payment Options

Cell Phones, Utilities

The introduction of a new generation of iPhones has always been met with much anticipation and fanfare, with this year being no different. And if history continues to repeat itself — and it looks like it will based on preorder figures — this will be another record-breaking year for sales.

If you’re in the market for a new iPhone, you now have several options when it comes to purchasing one.

The options

Buy outright

Starting at $650 for the 16GB model, you can purchase the new iPhone 6S and own it outright. By doing this, you’re not beholden to a carrier, and when the next round of iPhones are introduced you’re free to sell it online and earn some of your money back.

Pay in installments

Most phone carriers, including Verizon, AT&T, Sprint and T-Mobile, have moved away from traditional two-year contracts and toward 24-month installment plans. For example, at AT&T and Verizon, if you opt for the installment plan, your monthly bill will include your data plan fee and the monthly cost of your phone. Once your phone has been paid in full, your bill will reflect only the cost of your phone service.

» COMPARE: Best cell phone plans

This year, Apple introduced its own version of an installment plan, called the Apple Upgrade Program. The monthly cost includes AppleCare+, which, when purchased outside of the program, is $129. AppleCare+ means that you get “two years of hardware repairs, software support and coverage for up to two incidents of accidental damage.” You still need to sign up with a carrier for service.

Stick to a two-year contract

Many carriers are moving away from the traditional two-year contract, which subsidizes the cost of the new phone. However, if you’re currently on a two-year contract, some carriers may grandfather you into a new deal.

Comparing the carriers

Below, we’ve laid out what each wireless provider is offering in terms of a monthly cost. Remember, these prices reflect only the price of the phone itself, not any additional fees for wireless services as decided by your carrier’s network.

We compared the cheapest plans for each network. The monthly price and time to upgrade can change, based on the configuration you choose and the version of the phone you’re interested in.

Carrier iPhone model Monthly cost
Apple iPhone 6S 16GB $32.41/month* for 24 months (option to trade your phone in for a new one after 12 consecutive payments)
Verizon iPhone 6S 16GB $27.08/month
AT&T iPhone 6S 16GB $21.67/month for 30 months (option to trade your phone in for a new one after 24 consecutive payments)
T-Mobile iPhone 6S 16GB $27.09/month for 18 months (option to trade your phone in for a new one up to three times per year)
Sprint iPhone 6S 16GB $26.39/month for 18 months (option to trade your phone in for a new one after 12 consecutive payments)

*includes AppleCare+

Which payment plan is right for you?

If you prefer keeping a phone for at least two years, it’s cheaper to buy it outright or continue with a subsidized two-year contract, if you can. However, if you like owning the latest and greatest in technology and want a new phone every year, you’re better off going with a payment plan and dropping your contract.

» MORE: 3 steps to finding a cheap cell phone plan

Apple’s Upgrade Program could be best from a cost perspective. While most of the carriers are advertising monthly plans lower than Apple’s, their plans don’t include insurance.

Under the Apple Upgrade Program, the phone will come unlocked so you’re free to pick your own carrier. The downside is you’ll have two bills for your phone: one from Apple and one from your wireless provider.

But going with the carrier offers another benefit: You don’t have to be locked into the Apple world. If a new phone catches your eye after a year, you’re free to switch to a different phone altogether.

This article was updated on June 2, 2016. It was originally published September 15, 2015.

Kirsten VerHaar is an editor at NerdWallet, a personal finance website. Email: kverhaar@nerdwallet.com. Twitter: @kirstvh.