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Consumer Reports: Prepaid Phone Plan Can Be Smart Way To Save

PITTSBURGH (KDKA) -- What's the best cell phone service?

Verizon and two smaller companies, Consumer Cellular and U.S. Cellular, just earned top ratings in Consumer Reports' latest survey.

But if you're trying to save money, Consumer Reports says a pre-paid service can be a better option.

It seems like just about everyone has a smart phone these days. And we're paying big bucks for all that connectivity.

"The average American household spent more than $1,500 this year on phones and services, and the biggest spenders easily spent twice that much," said Rosalind Tordesillas, of Consumer Reports.

Consumer Reports says a prepaid phone plan can be a smart way to save.

"Two-thirds of our subscribers who switched to prepaid service knocked $20 or more off their monthly costs," Tordesillas said.

Prepaid services are offered from companies like Tracfone, Straight Talk, and Metro PCS. Big cell phone providers - Verizon, T-Mobile, and AT&T - also offer prepaid plans.

"Prepaid plans are either pay-as-you-go or have a monthly allocation of minutes," says Tordesillas. "Some even have unlimited plans. You may pay more upfront for the phones, but you can save in the long run."

The phones offered with prepaid plans used to be just the basics, but some prepaid carriers now offer smart phones.

The Galaxy S III is even available from Metro PCS and the iPhone 5 from Cricket Wireless, another prepaid company.

But if you don't need the absolutely latest smartphone, Consumer Reports recommends Straight Talk's prepaid plans, available through Walmart.

"It's interesting that people in our survey were actually happier with Straight Talk than with contract service from any of the major carriers," added Tordesillas.

Straight Talk has several plans, including $45 a month for unlimited talk, text and data. That's half the price of Verizon's cheapest unlimited plan.

Consumer Reports has another money-saving tip. When you're coming off a contract, if you have a phone you like, ask if you can transfer the phone to a prepaid plan with your current carrier or a new carrier.

You often can get the same service you've been getting but pay a lot less.

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