Apple iPhone Upgrade Program: What is it and is it worth it?
What is the Apple iPhone Upgrade programme?
Apple's iPhone Upgrade program is a 20 month contract that allows you to upgrade to a new phone every 11 months. You pay a monthly fee for the phone (SIM-free) and get AppleCare+ insurance too.
How much does Apple Upgrade program cost?
The price depends on the model of phone. At the time of writing (June 2019) you pay £69 on the day of purchase and then a monthly fee over 20 months.
- iPhone XS 64GB costs £56.45 per month (Total: £1,198)
- iPhone XS Max 64GB costs £61.56 per month (Total: £1,298)
- iPhone XR 64GB costs £41.45 per month (Total: £898)
Is the contract for 11 months or 20 months?
The contract is for 20 months. But, after 11 months you have the option to upgrade to a new phone and start a new 20 month contract.
What is AppleCare+?
AppleCare is an insurance product that comes with the Apple iPhone Upgrade. If you damage your phone for example by breaking the screen, Apple will fix it. However, you will still have to pay some money:
With AppleCare+ included, you get up to two years of hardware repairs, software support, and coverage for up to two incidents of accidental damage, each subject to an excess fee of £25 for screen replacement or £79 for any other damage. AppleCare+ for iPhone XS is £199, for iPhone XS Max is £199 and for iPhone XR is £149, when sold separately.
The total prices for Apple iPhone Upgrade listed above includes this cost for AppleCare+. This is a significant contributor to the overall cost of the programme.
Is Apple Upgrade Programme Worth It?
The primary attraction towards Apple's iPhone Upgrade program is to have the latest phone every year. However, the compulsory addition of AppleCare+ makes it more expensive than buying the phone yourself, and there may be other financing options available (see below).
What other financing options are available for the Apple iPhone?
Apple has finance options available for any purchase including the iPhone. For example, at the time of writing it has a partnership with Barclays offering 0% interest on 12 month loans. Read more here. (Note - it used to do 20 month loans which may still be available: ask in-store).
This means you could get an iPhone XS from £999 (over 12 months) instead of a total of £1,198 (over 20 months). Of course, this depends on whether you can afford the increased monthly payments over the shorter time frame.
Plus, buying it via other financing options does not include AppleCare+ insurance. Yet, you can buy other mobile phone insurance for less. But excesses may differ (the amount you have to pay per claim).
What other cheaper options are there?
You could get a credit card with 0% interest over a longer period of time. For example, Barclaycard has a credit card allowing you 0% interest on purchases for 27 months. This is effectively the same thing as Apple's finance option, simply over a longer period of time. Of course, you do not get the ability to upgrade your phone after 11 months. (But you could sell your old one and buy the new one... Keep reading).
What if I trade-in my old iPhone?
If you have an old iPhone you can trade it in with Apple. How much will you get for it? See prices here.
If you trade-in your old iPhone (or Apple laptop, tablet, watch), credit will be applied to your account. This reduces your overall cost of the Apple iPhone Upgrade.
If you sign up to Apple iPhone Upgrade programme, after 20 months you will then own your new phone and should you wish to continue you could trade that in too and thus continue the discounted rate.
A general rule of thumb at the time of writing: Apple pays about £200 for a phone model of two years old, in very good condition.
Is it better to sell my Apple iPhone myself?
You can see how much you can sell your Apple iPhone on sites like eBay or Amazon Marketplace quickly with SellMyMobile.com. You may find that you can sell it for more.
If you compare trade-in quotes with selling it yourself, you'll see which is the better option for you.
How to create your own (cheaper) Apple iPhone Upgrade program:
- Get a long-term interest free credit card (e.g. Barclaycard)
- Buy the iPhone you want from Apple (see deals here)
- After 11 months, sell your iPhone via SellMyMobile.com (for approximately £450)
- Immediately use the money raised to pay off the remainder of your debt (or as much as possible)
- Buy the new Apple iPhone
- Either pay off all the new debt within the remaining time frame, or before it ends, shift the debt to a new 0% interest credit card.
Is it better to use my savings rather than debt?
Always.
When is the best time to start Apple Upgrade program?
Apple has a history of announcing new iPhones in September and releasing them in October. Therefore, if you want to get the new phones as fast as possible, you should start your Apple Upgrade program soon after the new iPhone is available.
The best time to sell your iPhone
If you are selling your iPhone yourself, the best time to do it is late August or early September. This is because you want to sell before the newer versions are announced and your phone drops in value. Historically, iPhones tend to depreciate in value significantly when newer versions are announced.
However, this also means this is when it's cheaper to buy an older model of the phone. So if you're willing to wait for that killer feature, hold on until after a big announcement. You'll save hundreds.
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